Here’s a letter to USA Today.
Editor:
Paul Osterman claims that 35% of workers in America today are “disposable” – a status that renders them both underpaid and easily dismissed (“The job crisis is more than AI. Gig work makes you disposable,” October 6). Odd, that. Workers who produce for their employers value that’s far higher than these workers’ wages are workers that employers – greedy as they are for profit – should be especially keen to continue employing. Underpaid workers are practically nondisposable.
Let’s assume for the moment, however, that Mr. Osterman has his facts straight. If so, he personally can help to remedy this problem of underpayment and earn big bucks in the process. Underpaid workers are like hundred-dollar bills strewn on the sidewalk. Mr. Osterman can open businesses and bid these workers away from their current exploiters, offering them a package of pay and perks superior to what they now receive yet still leaving him a substantial profit on each worker. Mr. Osterman’s handsome profits will attract other entrepreneurs to follow in his footsteps. As Mr. Osterman and these other entrepreneurs bid for workers, the workers’ existing employers – again, motivated by their own self-interest – will raise these workers’ pay.
The fact that Mr. Osterman doesn’t put his money where his mouth is strongly suggests that he either doesn’t understand the labor market about which he writes, or that he’s really not confident about his empirical claims. Either way, policymakers should be very skeptical of his policy recommendations.
Sincerely,
Donald J. Boudreaux
Professor of Economics
and
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030
