Employers need employees, and employees need employers. If you have orders to fill, and noone to do the work, you're just as fscked, as if you have bills to pay, and no money to do it. Employers get an added benefit of being able to wait it out a bit, since they generally have more money than workers, and workers have unemployment benefits, which means that they can wait it out (until the benefits stop).
The problems will be more apparent when the benefits stop, poorer employers will close down in the meantime, and when people have to go back to work, there will be fewer workplaces for them available, bringing the wages down.
> Employers need employees, and employees need employers. If you have orders to fill, and noone to do the work, you're just as fscked, as if you have bills to pay, and no money to do it.
Na, not really. An employer can just raise their prices until incoming orders and delivery capacity align. That’s a sustainable situation for the employer. There may be some opportunity cost, but they’re doing okay.
An employee on the dole on the other hand is not in a sustainable situation. They have to find a job before they run out of benefits and savings, or the consequences will be dire…
Only in monopolistic situations or situations causing everyone to raise prices at the same time would the possibility of "just raise their prices" be workable.
If the price gets too high people will seek alternate suppliers or do without.
Example: We pay a private company to haul trash to the dump. There's many such companies, so if my company raises it's prices, I'll switch to another. We had one company raise its prices recently and everyone switched to another. I'm not sure this company is still around.
Example: Comcast kept raising my cable TV bill. I eventually just ditched it and went Internet only. $200/month for TV isn't worth it.
> If the price gets too high people will seek alternate suppliers or do without.
That’s exactly the desired effect. I didn’t say raise prices to make more money. I said raise prices until incoming orders and delivery capacity align. The purpose is to get less orders.
yes but depending on the state / size of your company, you can reallocate people in emergency mode, work more yourself (if you're the boss), ask for loans at the bank, you can absorb a lot more than a single individual can
The problems will be more apparent when the benefits stop, poorer employers will close down in the meantime, and when people have to go back to work, there will be fewer workplaces for them available, bringing the wages down.