I understand that there are shareholders and costs increase, but surely the cost increases should be at the rate of inflation?
I know a load of companies increase by like 3.9% + Inflation every year – so why is it that when employees get pay rises they’ll always be less than the rate of inflation?
Doesn’t that just mean employees get poorer every time? Where does the extra 3.9% money actually go? Where does the difference between employees payrises and rate of inflation go?
Are all companies just screwing their employees or is there some other reason I’m not realizing?
In: Economics
You are spot on – the companies are screwing their employees. But that’s nothing new (generally). We don’t expect a company to pay more than it has to for a new computer system or a new assembly line machine. Employees are not considered any differently – if you can get the labor you need for $10, you’re not spending $15 as an employer. Doesn’t matter what things cost, what’s going on with inflation, etc. (except to the extent those things make employees hold out for better wages).
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