Originally Posted by
73qanda
From wiki;
Now I’m no economist but even wiki lets me know that an increase in people offering their labor decreases the equilibrium wage. ( personally I think the equilibrium wage will increase regardless for the next five years).
Inducing additional supply into the Australian market, with the externality absorbed by others is what is at play.
There is a structural shortage and additional supply would be sourced with a shift in 'the curve' raising 'wages'
As have been observed in most western economies, REAL wages (after inflation) are at best neutral. This means over time purchasing power declines.
The interesting thing for students of the economy is that nearly 100 years ago Henry Ford summed up precisely the predicament in modern western economies:
“The owner, the employees, and the buying public are all one and the same, and unless an industry can so manage itself as to keep wages high and prices low it destroys itself, for otherwise it limits the number of its customers. One’s own employees ought to be one’s own best customers.” -Henry Ford, Today and Tomorrow, published 1926.
The shortage, ironically, is demographic in nature, which has been coming since the end of the Second World War. Airline management gutted the industry, convinced oversupply would facilitate endless reductions in terms and conditions, thereby ignoring and ultimately creating and destroying itself.
In airline administration offices tomorrow, endless idiots search for the next way to extract more from their staff.With less on offer and pilot licences costly to acquire and indeed maintain, every cent extracted from staff creates additional feed backs which undermine their very business. On they rush, ensuring eventually their own demise.