With advances in science and technology, it is possible for the goods and services needed by all the people to be produced with less hours of work and higher productivity.
If the required quantum of work is shared fairly among all those who are willing to work, it will be possible for each person to work lesser hours that they do now.
In a competitive environment, some people will work longer hours to ensure that their jobs are secure. This will cause other people to be unemployed.
The business owners can pay lower wages when there there is a limited supply of work and an over-supply of workers looking for work. With lower wages, they can make a larger profit.
This is a short sighted approach. If people have lower wages or are unemployed, they will have less money to spend on other things. This will further reduce the demand and contract the economy.
A better system is to have the work fairly distributed among the available workers, so that everyone will be employed and can enjoy a fair wage. They will have money to consume other services, such as leisure and entertainment. This will create demand for the production of other goods and services.
A healthy economy depends on the ability of people to get employment at fair wages. It requires legislation on the maximum working hours (so that the work is fairly distributed among the workers) and a minimum wage, so that all workers will earn enough to meet the cost of living and be able to have additional money for savings or to be spent on leisure.
Tan Kin Lian
If productivity keep rising, then there will be more people out of work.
ReplyDeleteIn certain sectors, each employee on average can produce more than 2 million dollars worth of good every month.