Gongol.com Archives: September 2022

Brian Gongol

September 5, 2022

Business and Finance Making a happier Labor Day

Labor Day remarks tend to be platitudinous. People and organizations that feel obligated to mark the day can usually go the safe route with some version of "Workers are the backbone of the American economy". Left-leaning politicians usually insert something celebrating organized labor unions. Right-leaning ones frequently offer some kind of praise for small business owners and other proprietors. ■ It would be more productive to take Labor Day as an annual trigger to have real debates about what would be broadly useful to the American workforce. The mere statistics of union membership don't tell much of a useful story. For instance: Are workers better off in occupations where they feel union membership is worth the dues, or is low membership a sign that employers are voluntarily satisfying worker expectations? Particularly in a time of 3.7% unemployment (low by most historical standards), a private-sector union membership rate of 6.1% might just be a symptom that many workers are getting what they want. ■ A more interesting debate would ask questions like "What policies or practices would ensure that more people in the labor force were able to convert their work into capital ownership?" Or "How can employers in the public and private sectors alike be rewarded for investing resources in long-term skill development?" These and others might be much more productive questions to discuss than merely lining up along tired old divisions. ■ Those divisions are tired because, now more than ever, workers can't be centered on a single employer or a single occupation for an entire career. The marketplace is dynamic, and there is no sheltering the American worker from technological and international competition. If research analysts, sales managers, and computer programmers are among the occupations most at risk of displacement by artificial intelligence, and management jobs are being eliminated by the auto industry's shift to electric vehicles, then we need a much more holistic approach to the question of "What's good for labor?" than a boring old dichotomy of "labor versus capital". ■ And that's even more the case because having a prudent retirement plan requires almost everyone to become a share-holding capitalist in the financial markets. Only a slim minority of workers are even engaged in defined-benefit pension plans, and even they should probably have some kind of backup plan that involves personal investments in the financial markets. It's not "labor versus capital", it's "labor and capital". ■ Not many people have the right incentives to fire up discussions about a subject like Labor Day that won't fall within predictable boundaries. But it shouldn't be that way. Labor Day shouldn't just be the last hurrah of summer, nor just a day full of platitudes (and some pandering). It ought to be a healthy annual reminder that economies are dynamic and people are often adaptable, and success on a civilizational scale comes in part from making sure that adaptability both enhances and takes advantage of that dynamism.

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