I’d like to congratulate the economically challenged crowd for making me look smart, which is no small task, i might add.
A short while ago I went on a rant about the ludicrousness of setting mandated minimum wages and how it has negative impacts on the low skilled job seeker. Well, today I read an article about the very ills I spoke of.
Here is a quote from the article:
"We're going to eliminate boring, repetitive, dangerous jobs, and we're going to free up people to do things that are higher value," said co-founder Alex Garden, a former Microsoft manager and president of mobile game maker Zynga Studios.
Now the article itself is written to show how this is such a good thing and how it is going to free up people for higher value activities. The problem being, if you are the low skill individual who’s only value to the enterprise is to evenly place pepperonis over the surface of the pizza, you and your associated cost to the company, have just been replaced by a one time cost of purchasing a robot.
The company will not have to pay for the robot’s health insurance (other than a maintenance contract that I’m certain is less than an employee’s health insurance). Nor will it have to staff sufficiently to account for “no shows” or provide maternity leave, vacation, uniform allowance, etc., etc.
The high cost of purchasing a robot became much more of a reasonable cost benefit to the company when the $15 an hour minimum wage crowd started gaining traction. Which I believe I predicted in the August 19th rant about “The Minimum Wage Hoax”.
I wonder if Bernie and Hillary will jump up and take credit for this unintended, but easily predictable, consequence?
No, I’d bet they will spin the yarn to talk about greedy business owners who are choosing machines over people so they don’t have to pay them a “living wage”. This of course being the incentive for the development of the robot that takes the job in the first place.
The advent of the robot is merely the logical extension of increasing the cost of doing business through government regulation. For the businesses that can’t move their manufacturing to a country where costs are lower, the answer to unwarranted cost increases caused by government mandates is mechanization.
Replace the low skilled individual who’s on going cost of employment has doubled or tripled with the one time cost of a machine. And if the business has more than one shift, this machine can replace 2 or 3 employees per day. If the business is a 7 day a week business, then even more employees are replaced and the cost of ownership has gone down even further. I doesn’t take a genius to see the cost benefit in this equation goes to the machines and the minimally skilled job seeker faces an even bleaker future.
So, once again, thank you “living wage” advocates for making me seem prescient.
Or so it would seem to an old farm boy.
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