Supply Chain Breakdown and Inflation

[Neto]

Every anabaptist business owner I have talked to (some quite conservative) has staffing issues. What 18 y/o want to slave away in a wood shop for $15/hour when they could get into the construction trade for $20+ out of the gate?

Around here (Holmes Co.), it's the dog industry that is creating at least some of the labor issues. Someone I know (from our congregation) who works in management at Keim Lumber said that some of the guys take off time to tend to a dog sale, so what used to be their primary job (and primary source of income) has taken second fiddle to the dog business. (Someone else, in talking about the problem of restaurants not being able to depend on the work force of young, unmarried Amish girls, said "Why would they be willing to work evenings & weekends if they can walk into the bank & make a deposit of 'hunt gelt" in the amount of $70,000.00?")

[Ken]

Every anabaptist business owner I have talked to (some quite conservative) has staffing issues. What 18 y/o want to slave away in a wood shop for $15/hour when they could get into the construction trade for $20+ out of the gate?

Around here (Holmes Co.), it's the dog industry that is creating at least some of the labor issues. Someone I know (from our congregation) who works in management at Keim Lumber said that some of the guys take off time to tend to a dog sale, so what used to be their primary job (and primary source of income) has taken second fiddle to the dog business. (Someone else, in talking about the problem of restaurants not being able to depend on the work force of young, unmarried Amish girls, said "Why would they be willing to work evenings & weekends if they can walk into the bank & make a deposit of 'hunt gelt" in the amount of $70,000.00?")

OK, this post raises all kinds of questions, not the least of which is: what is "hunt gelt" in an Amish context* and why are teenage Amish girls walking around with $70,000 worth of cash?

*I have heard the term used to describe the Jewish chocolate coins given to kids at Hanukkah but I'm not familiar with it in an Amish context.

[Josh]

10 $7,000 dogs = $70,000 cash

[Josh]

It’s interesting to see people who make lots of money in their business complaining about their employees wanting to make more than poverty wages.

Why would someone work $15/hr with overtime when they could go make more doing something else?

[Neto]

Every anabaptist business owner I have talked to (some quite conservative) has staffing issues. What 18 y/o want to slave away in a wood shop for $15/hour when they could get into the construction trade for $20+ out of the gate?

Around here (Holmes Co.), it's the dog industry that is creating at least some of the labor issues. Someone I know (from our congregation) who works in management at Keim Lumber said that some of the guys take off time to tend to a dog sale, so what used to be their primary job (and primary source of income) has taken second fiddle to the dog business. (Someone else, in talking about the problem of restaurants not being able to depend on the work force of young, unmarried Amish girls, said "Why would they be willing to work evenings & weekends if they can walk into the bank & make a deposit of 'hunt gelt" in the amount of $70,000.00?")

OK, this post raises all kinds of questions, not the least of which is: what is "hunt gelt" in an Amish context* and why are teenage Amish girls walking around with $70,000 worth of cash?

*I have heard the term used to describe the Jewish chocolate coins given to kids at Hanukkah but I'm not familiar with it in an Amish context.

hunt = dog
gelt = money

It's money gained from raising dogs. I put it in PA German because of what I heard from some Amish guys I worked with years ago, when raising dogs for sale was a pretty new thing around here. 'Hunt gelt" is the term used in the German Bible for money gained from male prostitution, which was "forbidden to be brought into the temple". There were some who thought that these people who were making money raising dogs should not use those funds to make up their tithe.

(The deposit was almost certainly in checks.)

[RZehr]

It’s interesting to see people who make lots of money in their business complaining about their employees wanting to make more than poverty wages.

Why would someone work $15/hr with overtime when they could go make more doing something else?

1. It is probably something to do with the inability to immediately raise prices to cover the increase in payroll cost. It’s not necessarily an inherent objection to raising employee wages. I tend to think of the problem as a temporary problem, which eventually the business will be able to increase prices to cover the increased payroll cost. But it could be that some businesses are unable, or barely able to hold on until the market is willing to pay higher prices. But that is always how it is, businesses unable or unwilling to adjust to market pressures will be replaced.

2. There is a cost of switching jobs, if one has been there for a while. Their coworkers, maybe benefits, schedule, etc.
When there are unemployed or underemployed people looking for work, they may weigh their job options from a pretty neutral standpoint. They will look at similar job offers they are interested in, and if one pays $15 and one pays $15.50, they very often will choose the $15.50. In this case the company was able to put compete his competitor by only increasing his cost by $0.50.
However, in a job market as it is today, the pool of available job applicants is scant. Therefore, if a company needs to hire, they may very likely have to attract a person who is already employed. In order to attract a person who is happily and fully employed, these people are not likely to change jobs for a mere $0.50 increase. Now, companies cannot “win” the bidding by only increasing by $0.50, they have to make their job offer high enough to overcome the friction/inertia of the employees current employee contentment. In order to do that, the company may have to offer someone $2 higher that they are getting. Now instead of paying $15.50, they are paying $17. And in a fast moving competitive labor market like we have today, this process can happen a couple times in one year. The company hires the new employee at $17, and six months later they have to increase to $18 just to retain him. And if the company has 50 people, the existing employees all may need a retention raise as well.

Its just pretty fast moving. Some businesses have prices that are in the form of multi year contracts. They can’t immediately raise prices.

I don’t think any of this is necessary a bad thing. If anything I think it is more good than bad.

[temporal1]

It’s interesting to see people who make lots of money in their business complaining about their employees wanting to make more than poverty wages.

Why would someone work $15/hr with overtime when they could go make more doing something else?

1. It is probably something to do with the inability to immediately raise prices to cover the increase in payroll cost. It’s not necessarily an inherent objection to raising employee wages. I tend to think of the problem as a temporary problem, which eventually the business will be able to increase prices to cover the increased payroll cost. But it could be that some businesses are unable, or barely able to hold on until the market is willing to pay higher prices. But that is always how it is, businesses unable or unwilling to adjust to market pressures will be replaced.

2. There is a cost of switching jobs, if one has been there for a while. Their coworkers, maybe benefits, schedule, etc.
When there are unemployed or underemployed people looking for work, they may weigh their job options from a pretty neutral standpoint. They will look at similar job offers they are interested in, and if one pays $15 and one pays $15.50, they very often will choose the $15.50. In this case the company was able to put compete his competitor by only increasing his cost by $0.50.
However, in a job market as it is today, the pool of available job applicants is scant. Therefore, if a company needs to hire, they may very likely have to attract a person who is already employed. In order to attract a person who is happily and fully employed, these people are not likely to change jobs for a mere $0.50 increase. Now, companies cannot “win” the bidding by only increasing by $0.50, they have to make their job offer high enough to overcome the friction/inertia of the employees current employee contentment. In order to do that, the company may have to offer someone $2 higher that they are getting. Now instead of paying $15.50, they are paying $17. And in a fast moving competitive labor market like we have today, this process can happen a couple times in one year. The company hires the new employee at $17, and six months later they have to increase to $18 just to retain him. And if the company has 50 people, the existing employees all may need a retention raise as well.

Its just pretty fast moving. Some businesses have prices that are in the form of multi year contracts. They can’t immediately raise prices.

I don’t think any of this is necessary a bad thing. If anything I think it is more good than bad.

The unknowns are, to my knowledge, there has never been such a huge increase in general low wages across the board as is happening via gov regulated Minimum Wages. Right or wrong, the ripple effect will be felt for years+years, probably never recovering. The mentality, “cause i’m worth it, honey” may not actually translate into a robust economy.

Add to that, Congress spending in the TRILLIONS.

They are out of their league. Everyone will pay - for life. These changes cannot be outlived.

As far as “today’s winners?” - i hope they enjoy it while they can.
As others are stating, prices of goods+services have already doubled, if they can be found.
This may be the quiet before the storm.

Compare:
2022 Soc Sec COLA is set to be 5.9%. (Without knowing Medicare increases, it’s impossible to guess the net increase.)
With 2021 gasoline and home fuel increases, alone, what is 5.9%? .. Food has increased. Typically, Soc Sec has tiny increases, or no increase, at all. But to rave about it - at this time - is not well considered.

Brace for it.
The numbers look like pandering for immediate votes with no thought of the long term. It looks like economic suicide, to me.
i’m sorry for young people who have no choice but to swim in it.

Congress: Trillions. Righhht. i’m sure ya’ll know just what you’re doing.


This video is 10 years old. ^^^ (Many numbers he uses are distant memories.)

[Josh]

Employers haven’t shown any loyalty to employees, and now employees aren’t showing any back.

[RZehr]

Employers haven’t shown any loyalty to employees, and now employees aren’t showing any back.

Some do. I’ve had multiple coworkers in the last few months volunteer to take pay cuts, and others voluntarily forgo raises because they’d rather see that money go to other employees. And others decide to stay, instead of taking other higher paying job offers. Another man from another competitor applied for an opening here, and after we made him a job offer, he ultimately decided to stay where he was. His loyalty caused him to remain where he was.
Now obviously these are rare, but I’m just saying loyalty isn’t quite completely extinct. Nor am I suggesting one should stay loyal at all cost.

[JimFoxvog]

Congress: Trillions. Righhht. i’m sure ya’ll know just what you’re doing.

I hope you're aware the trillions proposed for the infrastructure bill are much less than the trillions that go to the military. With any moral sense, the funds could just be transferred from where they are harmful to something helpful.