Targeting Low-skilled Workers

by Don Boudreaux on December 9, 2009

in Competition, Complexity & Emergence, Prices, Reality Is Not Optional, Work

This evening while shopping at Target I noticed that, in a single trip out to the parking lot, one (teenage) employee manages to round up and return to the entry-way of the store a quantity of shopping carts that, when I was working such jobs 30-plus years ago, required the concerted efforts of at least two employees.

Today’s employee is assisted in his or her efforts by this nifty piece of capital equipment.

IMG_0369

This mechanical device — the name of which I do not know — pushes the shopping carts from behind as the employee effortlessly guides them into place within the store.

It’s especially important for those persons who support minimum-wage legislation to realize that employers can almost always, at the margin, substitute away from human labor and toward mechanized or electronic “labor” — that is, capital.  Mythical indeed is the notion that employers must hire a given, or minimum, number of low-skilled workers.  As the cost of hiring such workers rises, employers have greater incentives to substitute away from employing such workers.

This machine whose operation I witnessed today at Target testifies to the futility of minimum-wage legislation to improve the lot of most low-skilled workers.

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