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Bastiat's Bastions

What is seen and what is unseen.

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I won’t be in to work yesterday

Some questions for you:

  • If the employees don’t like the conditions under which they labor, aren’t they free to find another job?
  • And if they remain employed at this firm, doesn’t it mean that being employed at the firm beats alternative employment?
  • If you were running a firm, wouldn’t you want to be able to determine the wages and benefits you offered your workers?
  • What if you were a stockholder of this corporation?
  • If a firm offers a less competitive package than other firms, wouldn’t they have a difficult time finding and retaining employees?

I think these questions have reasonably clear answers – or do they? Perhaps they do until I mention that some people are implicitly asking these questions of the dreaded, gasp, WALMART! Run for the hills!!!

Read this article. People are complaining about some changes Walmart made in their labor policies.

One of the things economists know from studying labor economics is that each job offers a package of wages and working conditions. Other things equal, jobs associated with more desirable working conditions are associated with lower wages, while jobs with less desirable working conditions are associated with higher wages.

Washing windows on the sides of skyscrapers is dangerous, collecting trash is smelly, and working in a cubicle is not fun. Other things equal, these workers receive higher wages to compensate for these conditions. Being a lifeguard, a forest ranger, or a fishing tour guide are associated with desirable working conditions. Thus these occupations have lower wages as a result.

One aspect of some jobs is that they have flexible hours. Do you think that workers at these type jobs “pay” for the flexible hours in the form of lower wages? I bet they do.

Do you think college professors pay for their flexible hours and the ability to do research on their topics? I know they do.

So here’s the interesting question. Subject to the law, should firms have the right to set up their compensation packages to attract the types of worker they want to work at their firms?

Suppose some firm likes its workers to be there all the time. Suppose they are more stringent about arriving on time and unexcused absences than other firms. This will make this firm less desirable for people who required flexible schedules (say working mothers). Is that discrimination against people who require flexible schedules (working moms)?

But before you answer that one, say a firm really thinks working mothers make great employees. What if they lower wages just a bit and use the savings to offer company-sponsored day care? Clearly that would be good for working mothers, and would attract working mothers to that firm. But is that discrimination against workers without children? Don’t they get lower wages than they otherwise would and don’t enjoy the benefits of the child care?

Tricky, eh?

Could it be the case that workers will sort themselves into occupations and jobs based on what types of packages they prefer?

Is Walmart doing something wrong?

–CT

This entry was posted on Wednesday, November 1st, 2006 at 8:07 pm and is filed under General. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

2 Responses to “I won’t be in to work yesterday”

  1. Earl Davis Says:
    November 3rd, 2006 at 8:04 am

    Walmart is The Great Satan. Why do you obfuscate his nefarious intent?

  2. Brittany J. Williams Says:
    November 7th, 2006 at 8:44 am

    Recently while visiting a Wal-Mart store, I asked an employee why the store shelves are always half stocked, her reply was “We don’t have enough emplyees to keep them fully stocked”. If Wal-Mart is making such drastic changes in employee policies, now we know the reason why they can’t keep employees. Wal-Mart is supposedly known as a family store,however, if they don’t consider family emergencies and/or other unexpected situations when making policies changes, they will not keep valuable employees. Wal-Mart hires mostly low income individuals, college students and many single parent families whom they pay meager wages. Many of these individuals need their jobs, but they are in transition periods in their lives where situations are constantly occuring. Many of these individuals often drift from job to job and will quit a second job without a second thought, if they feel they are being mistreated. These individuals can often get another low-income service job, with less stress for the same wages Wal-Mart pays them. Wal-Mart may want to seriously think about some of the policies they are implementing, given the population of employees they have to choose from. Although, I believe employees have a right to change their company policies if they believe it would be in the best interest of the company. The company has to be willing to offer company benefits if they want their company to meet a certain criteria. If Wal-Mart is considering making such drastic employee changes, they may need to raise their wages and start a major recruitment campaign for a different class of employees who are willing to work under stressful conditions for a higher salary.

    Dr. Turner, Econ 211, 3m