Gosh the TUC now coming out about low pay, if Labour were still in power all you’d get would be silence.

I know the questions about how having our economy open to the whole of eastern Europe has been answered many times before, but I always seem to forget what the answer was.
The argument is (I think) that a million workers from Poland etc grow the economy more than the jobs they actually take away from British people.
It’s an argument you have to keep making, because I’m sure it’s not just me who forgets.
I slip back into that idea that some of this flow of labour has actually harmed low paid Brits.

Sales and elementary service and admin jobs are responsible for 41 per cent of the claimant count rise since 2008, even though they represent less than 20 per cent of the workforce.

Having had more experience with Sales and Admin than I care to remember, I am not sure why I should be upset about this. Upset about people losing their jobs, yes. Upset that specifically these people are losing theirs? Not really. Better than Brain Surgeons or Engineers, isn’t it?

The two job categories have the lowest pay rates of all occupations at just £6.55 an hour.

I also always suspected that such people added little value (even if at great cost in time and irritation) to any business. It is nice to see I was right. Again, it is sad that anyone has lost their job, by why it is specifically sad these people have?

Elementary service and admin occupations – such as labourers, bar and catering staff and cleaners – have had the second sharpest rise in claimant count unemployment, almost doubling from 86,250 in April 2008 to reach 168,015 in August 2011.

I feel bad for the labourers and the cleaners. But bar staff? Cry me a river. Come on, I can’t be alone in this – you would prefer it was among, say, teachers? Nurses?

Err, yes, this is obvious.

Pay tracks, roughly at least, productivity. The amount that an employer can make from employing the worker.

Low paid workers are thus, pretty much by definition, those with the lowest productivity.

In hard times (for, as we all know, bosses and capitalists are indeed complete bastards interested only in profits) those with the lowest productivity are going to be those shown the door, aren’t they?

It may well not be nice or pretty but it is obvious.

Tim Worstall/4: Is it obvious? Even with the simplification that pay is related to productivity I’m not sure it necessarily holds.

So, one person A costing £30k to employ (salary+on costs) gives £X to the company. Another person B costing £60k to employ gives £Y to the company (Y>X)

In normal economic circumstances, X > 30, and Y > 60, or they wouldn’t have been hired in the first place. I’m not sure that in a bad economy, it automatically follows that X will fall below 30 before Y falls below 60. (That would generally require Y > 2*X, which would mean that the productivity curve was usually positive, but perfect information implies that it must be usually flat)

And this is all assuming that individual productivity is possible to measure accurately, and that A and B have independent productivity. (Quite obviously a pure manager does not have independent productivity, for instance, since their productivity is only the marginal increase in productivity of their subordinates as a result of their presence, which means at least some of them should be sacked even if they offer to work for free.)

“I’m not sure that in a bad economy, it automatically follows that X will fall below 30 before Y falls below 60.”

I certainly wouldn’t say “automatically”. “Tends to” perhaps.

@4 – “Low paid workers are thus, pretty much by definition, those with the lowest productivity.”

And thus worth the least to society so we should let them starve. Single-minded right winger logic again.