Saturday, October 9, 2021

"Dark City" labor market

Imagine a world where buying consumer goods takes place only on Mon-Tue-Wed-Thur-Fri — and — cashing pay checks done only on Sat-Sun.  (I just viewed Dark City, so I am in the mood for such a model.)

Typical employers like Target and Walgreens average 12.5% labor costs — outliers WalMart and fast food have 7% and 25% labor costs.  Say, in one-single Mon-thru-Fri week, lower 40% pay employees double wages on average -- up 50% at fast food, up 2 1/2 X at Walmart.

Consumer prices for goods produced by lower income workers have to rise about 12.5% across the board — demand falls 12.5% for lower pay produced goods …

on that particular Mon-thru-Fri.

Sat comes; lower cost workers pick up their doubled pay — for producing possibly fewer goods — Mon-thru-Fri haven’t dawned yet.

Mon comes; lower pay workers take the extra money squeezed from consumers to market to purchase goods and services — probably proportionately more on goods produced by lower wage workers.  Demand for lower pay produced goods rises more than 12.5%.

Put this eight-grade, market math to work for everybody whose labor the consumer might agree is worth more:

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