Forum Post: A high tech factory can still be profitable with a 16-hour worweek
Posted 13 years ago on Oct. 25, 2011, 9:15 p.m. EST by TechPromisse
(14)
This content is user submitted and not an official statement
Some analysts say that a high tech factory, with a high tech production line, and high productivity, can still be profitable even if all the employees work only 16 hours per week.
Of course the profits would be smaller than if the employees work 40 hours per week, but it would still be profitable.
A 16-hour workweek, with people working 4 hours a day, 4 days per week, is viable in most of the factories in the USA.
But the guys who want to maximize their profits, so they can "work" only two hours per week and spend the rest of the time enjoying the golf club, the golden plated jacuzzi, and the private yacht, won't allow it to happen.
So, the plebeians will keep working overtime, and providing overprofits to the aristocracy.
There's no need to people work like slaves, with no time for their families, for leisure and for culture.
This is certainly true. It's appalling that we complain about kid's shooting, or doping or even graffiting when their parents have been taken from them.
Stop treating schools like day care centers for the worker's kids. Pay a living wage so at least one parent can stay home to talk, tutor, drive, make meals and live.
Paying for day care because you have to work for food is a nightmare and far from the American Dream.
Why would you want to under utilize those manufacturing facilities? Maybe some individuals aren't willing to work 40 hours per week, fine they can arrange for part-time work (and expect accordingly lower compensation). But a manufacturing facility can be humming along full time all the same.
it's called a part time job...oh...may bad...u wanna work 20 hrs a week but get paid like you're working 40. So I guess the CEO can just stay home and not even work 2 hrs a week....guess you'll b protesting that before long too.....if he doesn't work but gets paid then why should we......your logic is awesome!
Your premises are flawed. For one the people working want to maximize their profits as well which means working more hours for more money.
I like how they think that these machines (which we don't have and aren't even close to creating) are somehow going to ease the lives of all. Yeah I believe that sometime back in the 70's or 80's that same theory was postulated, and look where we're at now. Didn't work then. Won't work now. If I can be profitable with 100 machines and 5 people working 20 hours a week, then I will be more profitable with 200 machines and 5 people working 40 hours a week, or even 300 machines and 5 people working 60 hours a week. It's all about finding the sweet spot where people can't work anymore.
While you are right as far as you go, the problem is that demand for more goods and services is not inifite. There is a law of diminishing returns, and then even negative returns, to having more stuff that owns you and having more services that get between you and your abilities. That is a major flaw in mainstream economics, to assume infinite demand. So, when all factory owners follow what you outline, then they all end up with lots of good and services but no markets for them. So prices fall, as do profits. For any one factory owner what you say makes sense, but taken as a whole, it doesn't work (even ignoring people could nto pay for the products even if they wanted to from low wages). Related theory from the 1960s: http://www.educationanddemocracy.org/FSCfiles/C_CC2a_TripleRevolution.htm
Ultimately, we need broad change to deal with this, like a basic income, a gift economy, improved local subsistence, and/or better participatory government planning on all levels of scale.
But discussion of economic alternatives has been systematically shut out of academia for decades; see: http://www.responsiblefinance.ch/appeal/
My point was more, not that there is a point of diminishing returns because there is, but that factories will choose to maximize profit. They will not settle for JUST being profitable. There is no such thing as "enough".
And that is a good thing.
Can you please clairify why you think no such thing as enough being a good thing? Do you want more or do you want to see the system fail?
Excess production may cause a lot of pollution and suffering, and a lot of watsed time in competition ad noxious everpresent advertising.
And the capitalist economy itself can go into boom/bust cycles or even a death spiral (which we may be seeing now) that may lead either to a new vision of economics or possibly just crazy global wars where everyone loses. It may be better if the global economy transitions smoothly to some other paradigm than if it just collapses or goes increasingly crazy.
No fool engages in wasteful production. But honestly right now we can't keep up with demand here, so yes employees are working 50+ hour weeks because it's cheaper to work them harder than to hire more people. And machines don't exist to do this work, and probably won't ever. There are problems with machines that sometimes makes humans the cheaper alternative.
Well, a lot of foolish things happen for ideological reasons. :-)
Robotics is improving by leaps and bounds.
Examples: http://roboticnation.blogspot.com/
More: http://econfuture.wordpress.com
The USA already has a lot of idle factory capacity. The last Great Depression had warehouses stuffed with consumer goods but no one with money to buy them as all the cash was hoarded by the 1%: http://www.businessinsider.com/do-low-tax-rates-on-rich-people-ruin-the-economy-2011-7
There are lots of goods in US stores. US GDP rose about 30% or so during the past decade with no net increase in the number of workers (through increased productivity). But none of the benefits went to the workers as wages were flat. Now we have so many unemployed people that wages continue to fall even as productivity continues to rise.
We could also produce much more with less people if companies were not so wastefully competitive, but that is how our system is set up.
Still, I'd agree that there are a lot of people who do not have enough materially. But that issue is not so much lack of productive capacity but instead that they have no money so the market does not "hear" their needs. A basic income could solve that.
Because minimum wage has solved so many problems already. (sarcasm)
If companies have wasted production, eventually they will go under if they keep it up. The business cycle does account for times when you have greater production capability than demand requires. But it never stays like that forever. And yes robotics may have come a long way, but labor in other countries is still cheaper than robots here.
With a basic income, there would be no need for a minimum wage to protect workers, because they would already be getting enough to live from with the basic income. http://en.wikipedia.org/wiki/Basic_income
If companies have a lot of capital, and if they have enough money to buy influence in Congress to give their company various preferences, then the sound logic you outline breaks down. We are seeing this with the insurance industry, for example. Who wants to buy an increasingly overpriced health insurance that gives you access to sick care providers who do little to keep you well? So now buying private insurance is being mandated.
Alternatives: http://www.drfuhrman.com/library/PCI_angioplasty_article.aspx "The sad thing is surgical interventions and medications are the foundation of modern cardiology and both are relatively ineffective compared to nutritional excellence. My patients routinely reverse their heart disease, and no longer have vulnerable plaque or high blood pressure, so they do not need medical care, hospitals or cardiologists anymore. The problem is that in the real world cardiac patients are not even informed that heart disease is predictably reversed with nutritional excellence. They are not given the opportunity to choose and just corralled into these surgical interventions. Trying to figure out how to pay for ineffective and expensive medicine by politicians will never be a real solution. People need to know they do not have to have heart disease to begin with, and if they get it, aggressive nutrition is the most life-saving intervention. And it is free."
For another health related issue with over production of factory farmed meats and processed grains, see: http://www.seriouseats.com/2007/11/the-subsidized-food-pyramid.html
Current schooling dumbs people down, but a huge teacher's union, and with schools themselves to drum the message of you need schooling into kids, we get a broken educational system. http://www.johntaylorgatto.com/chapters/17b.htm
http://www.johntaylorgatto.com/chapters/16a.htm
Big houses were subsidized via home mortgage deductions. Cars were subsidized by taxes for roads and such (instead of mass transit). Oil consumption has been subsidized by defense taxes. Coal burning has been subsidized by ignoring pollution costs to wildlife and human health. http://en.wikipedia.org/wiki/Externality
That is the (limited) truth to some conservative positions against big government -- that it can, and often is, co-opted by big business (of course, in Western Europe the story is quite a bit different, so alternatives are possible with better regulation).
So, while what you say makes a lot of common sense, the 1% often find a way around it through manipulating big government in their favor. This is not to be against big government, but we need the appropriate sort of government, and that's a challenge.
Yes, robotics has been more expensive than dirt poor labor in other countries, but that is changing, as other countries labor costs go up and as the cost of robotics goes down (and it become more capable). Look at this video of a robot tossing and catching a cell phone, for example: http://www.hizook.com/blog/2009/08/03/high-speed-robot-hand-demonstrates-dexterity-and-skillful-manipulation
Even China is starting to automate due to wage pressures: http://www.plasticsnews.com/china/english/headlines2.html?id=1278958338
Another wildcard is that "War is a Racket", so if you can get the government to pay you to make stuff that it blows up, there is a never ending market for it. http://www.lexrex.com/enlightened/articles/warisaracket.htm
Yes we already know that a high tech company can replace unskilled labor with machines. It is done all of the time to save money.
Learn some skills that are useful.
This is the logics of the corporations: replace workers by machines.
But there is another kind of logics: use technology to reduce the workweek, and hire a second group of workers. One group works on the morning, the second group works on the afternoon. And with the current technological level in the US, the factory would still be profitable.
Yes, but not as profitable if only having one worker work 40 hours. The less people you can hire the better. It is even, in general, more profitable to have current workers work more overtime than to hire new people.
Just being profitable isn't enough you know. It never is and never will be. Human nature dictates we must look to maximize our own gains.
This is bogus garbage! I repair equipment in factories with over 200 customers and automate processes for many of them. I can guarantee that your numbers are positively crap with no time studies to back them.
You are the misguided here. There are no formal studies yet, but the preliminary studies show exactly what is being claimed here.
I'm not misguided. I find myself in 10 to 15 different factories a week. I currently have over 200 customers and I can guarantee you that this is complete garbage. I don't know where some of the people on this forum get their ideas and claim them as fact but let me put this to rest for you right now. Your statement is unfounded and not viable.
Well... You repair equipment, but you are not an economist.
I got this info from a group of high level economists. They will publish the results soon. Maybe a Nobel Prize in Economics will be awarded.
I know what it takes to produce the products people use and the man hours necessary to do it. There are many processes that may require an entire day just to complete. There are machines that aren't even profitable until they have been running for at least 6 hours due to the high start up costs. There are steel companies that flat out never shut down their melting pots because of the high cost and the amount of time it takes to heat them back up. That's why they run seven days a week twenty four hours a day.
Neither you or your economist friends have any practical knowledge of how products are produced or profit margins.
My god we have some of the laziest people on the planet living in our country.
I can agree with you about how long some machines must run to be profitable under the current economic regime (how much of the cost often being interest though?), same as things like keeping steel or glass melting systems heated 24 hours may be needed. But, that does not mean the people at the plant need to be working 40 or 60 hour weeks and getting paid not that well or not treated that well with the profits being concentrated to the 1%.
But is almost does not matter because automation from robotics and AI is going to continue to spread. And then factories and equipment will be redesigned for automatic servicing (or at least, deskilled maintenance); see for one scenario: http://www.marshallbrain.com/manna1.htm
Also, even for the devices you repair, often a choice was made that it was cheaper to do repairs than to design the thing so it did not need repairs. Perhaps if someone like you had more say were in industrial system designs they would be more reliable? But our system is not set up to make that easy; you may have your role in our economic order and it is hard to get out of it. It is also not profitable to you if you repair machines to tell people how to avoid needing your services. The system is not set up in that sense to encourage true productive efficiency. The same is true for medicine -- there is lots of profit in putting in stents through angioplasty but almost no profits in telling people how to reverse heart disease with better nutrition so they don't need cardiologists or drugs anymore: http://www.drfuhrman.com/library/PCI_angioplasty_article.aspx
Industrial productivity has doubled or tripled over the last three or four decades, but real hourly wages for almost all people have remained flat or even declined about 25% for men aged 30-50 years old during that time period.
See on the issue of who gets the profits from improved productivity: http://www.capitalismhitsthefan.com/
And workplaces do not need to be designed in such a demeaning way to begin with: http://metanoia-films.org/humanresources.php
If necessity (and perspiration) is the Mother of invention, Laziness is its father. :-) So you don't have to bee too down on laziness. See also: http://idlenest.freehostia.com/mirror/www.whywork.org/rethinking/whywork/abolition.html "Liberals say we should end employment discrimination. I say we should end employment. Conservatives support right-to-work laws. Following Karl Marx's wayward son-in-law Paul Lafargue, I support the right to be lazy. Leftists favor full employment. Like the surrealists -- except that I'm not kidding -- I favor full unemployment. Trotskyists agitate for permanent revolution. I agitate for permanent revelry. But if all the ideologues (as they do) advocate work -- and not only because they plan to make other people do theirs -- they are strangely reluctant to say so. They will carry on endlessly about wages, hours, working conditions, exploitation, productivity, profitability. They'll gladly talk about anything but work itself. These experts who offer to do our thinking for us rarely share their conclusions about work, for all its saliency in the lives of all of us. Among themselves they quibble over the details. Unions and management agree that we ought to sell the time of our lives in exchange for survival, although they haggle over the price. Marxists think we should be bossed by bureaucrats. Libertarians think we should be bossed by businessmen. Feminists don't care which form bossing takes, so long as the bosses are women. Clearly these ideology-mongers have serious differences over how to divvy up the spoils of power. Just as clearly, none of them have any objection to power as such and all of them want to keep us working."
Agriculture went from 90% of the labor force in the USA 200 years ago, to 50% 100 years ago, to about 2% today (with maybe 2% more for industrial support?) while still producing more than back then. So too, we have been seeing industry drop from about 35% of the workforce 50 years ago to about 18% (or whatever) today while still producing more than in the 1950s. Likely manufatcuring will also be a few percent in the near future, same as agriculture. But, services are also being automated...
For a bigger change, like gardening is the biggest recreational activity outdoors, so too we are seeing the rise of DIY manufacturing and 3D printing as a hobby that may continue to increase and change the nature of how many things get made (especially as we get nanotech systems eventually). A lot of people just like to grown plants. A lot of people just like to make things. When our systems become so productive via automation and better design, more and more things can be done at home or run by volunteers (like Wikipedia or Debian GNU/Linux). On motivation without money, see: http://www.youtube.com/watch?v=u6XAPnuFjJc
I know these people are idiots. I like how they think that these machines (which we don't have and aren't even close to creating) are somehow going to ease the lives of all. Yeah I believe that sometime back in the 70's or 80's that same theory was postulated, and look where we're at now. Didn't work then. Won't work now. If I can be profitable with 100 machines and 5 people working 20 hours a week, then I will be more profitable with 200 machines and 5 people working 40 hours a week, or even 300 machines and 5 people working 60 hours a week. It's all about finding the sweet spot where people can't work anymore.
How are people lazy? There's nothing lazy about wanting to enjoy life to the fullest. Eventually, robotics with advanced AI will be self-sufficient enough to do most of the menial tasks we foist on people. How this will play out in the end isn't known - but the technology is advancing day-by-day.
This is the best kept secret in the corporate world.
Well, now it's no more...
Spread this hidden truth, please.
I prefer to work a lot.
This would never work...it would drive up the cost of components due to reduced production, and company returns would be so low that the investment would be pulled out leaving all the workers unemployed. Although I am sympathetic to the anger towards the greed and corruption (much of it in the government - lobbying), I believe many ideas on this movement have to be thought of more in depth.
I can assure you that the companies returns would NOT be so low.
The numbers say that, in the USA of the present days, in the most sophisticated industrial sectors, the returns would be more than enough.
thought so...
What you are saying doesn't even make sense. Give me quantitative figures or companies you speak of....and I will teach you exactly what I mean.