It's hard to divorce this seemingly good news from the reality that this is probably enabled by the fact the companies like BoA don't hire low-wage workers anymore [0].
This is a good point and a good article. If Bank of America like many other companies outsources a lot of its lower-paid positions, and these new standards won't apply to the outsourced jobs, then a higher minimum wage that mostly applies to people that were already being paid that much anyway won't do too much.
This move is basically meaningless if it doesn't extend to the temp agencies and businesses BoA buys labor from and contracts with to provide basic services (custodial, POS systems support, etc.). Sure the gesture is nice but it's hollow. Modern BigCos don't hire for low skill, low wage positions unless it's part of their core business. They contract all that out, either they get bodies from temp agencies or they get the entire service provided by a 3rd party.
Unless they are reducing employee counts in favor of hiring contractors, then trying to score political points about a hot-button issue like minimum wage.
These jobs aren't really high-quality work. We need less of them, and we need to provide those doing it a safety net or retraining for when they are displaced. Nobody should do factory jobs or other menial work just because we can't think far enough ahead to give them something new to do.
Many blue collar jobs are perfectly good well paying careers available without crushing student debt to people who (crazy, I know) don't want to sit by a desk all day.
I'm not saying these people have to take on desk jobs, I'm more of a basic income person myself. Instead of "hit X with hammer, place X in bin, repeat until retired" I suggest we find meaningful jobs for these people either in technical roles, small-businesses, liberal arts or whatever it is they want to pursue to create meaning in their lives. Robots will do the job better, they won't get tired, they won't get sick and they don't need meaning. These jobs aren't coming back, the sooner we face facts and work through it the better off we'll be in the economy of the future.
It's not 1919. Nobody is making their employees do the same repetitive labor in the same setting day in and day out. That's how you burn our workers. You can only get away with that in industries where they'd burn out regardless for some other reason. Modern factory jobs are no worse than the other jobs of about the same skill requirements and pay.
> Nobody is making their employees do the same repetitive labor in the same setting day in and day out.
Do you not know anyone that works in a factory? Spend some time in the South, or in the Midwest. You'll find people who do the same thing day-in and day-out. Those jobs still exist.
I've worked those kind of jobs. You rotate from station to station for each shift/time slot. It's really no worse than working in an institutional kitchen for the same length of time (and the pay is typically better).
I get that people in ivory towers will decry it all as horrible but the fact of the matter is that none of those jobs are any better or worse than the other once you account for people's variable preferences. I'd personally rather do outdoor labor of some sort but some people prefer the air conditioned factory floor.
That isn't my experience at all in a glass plant in the midwest. If you were a run of the mill laborer on the floor, you had a station and you worked your 8/12/16 hour shift right there the entire time. I stood at the end of a long cooling belt inspecting glass for QA defects, piece by miserable piece until I was able to clock out.
edit/ Also, throwing boxes for delivery companies or warehouses, you'll be standing at the end of your belt filling up trucks for the entire duration of your 8/12/16 hour shift.
About a decade ago, i worked in a factory that produced eggs for things like McMuffins. For 8 hours a night I would make stacks of 10 or so of these paddies coming down a conveyor belt and place them in a cardboard box. After several stacks the box would be full and you pushed it down a roller to go get sealed and shipped. This is ALL i did. I stacked paddies in a box and then pushed the box. I had some really elaborate day-dreaming scenarios that maintained my sanity. Lots of the people working there had 10+ years with the company doing similar mindless tasks - they are still around!
Sadly, I know a lot of college educated people who describe their white collar jobs as finding a related document, scanning it, and entering the data into the right place in a spreadsheet.
If that is indeed accurate, a lot of their jobs will be automated too. Few roles are truly 'safe' but the ones I'd write a script to solve are definitely less so.
Would you consider a job where you perform a repetitive physical task, potentially risky, with the same input and the same output better suited to a human or to a machine? Which do you think could do the job better?
If you had a job copy numbers from one spreadsheet into another spreadsheet, would you not write a script? Which do you think would do a better job?
It's not elitist, it's pragmatic. There are definitely jobs that require physical labor that provide meaningful value at the moment, though the days are numbered there too. Japan developed a fully-automated farm. [1] We shouldn't keep them around just because we don't have something better for the workers to do. It's our social obligation to find them something better to do.
It might surprise you, but some people actually prefer factory work, construction, and manual labor over sitting behind a desk.
But I definitely see more value in the jobs you demean than the "liberal arts".
If all jobs could be automated more cheaply than humans, don't you think they would have done it? There is nothing pragmatic about a liberal arts degree in Ancient Chinese Art History....
The good news is even if you see limited value in "liberal arts" the total value in the system will be higher, as automation retains or increases the existing value, and the displaced/retrained workers produce yet more value even if I accept the premise that it's limited.
>> If all jobs could be automated more cheaply than humans, don't you think they would have done it?
Not everything that's possible has become economical yet. This is kind of the definition of progress :) If all cancer could be cured, don't you think they would have done it by now?
The good news is even if you see limited value in "liberal arts" the total value in the system will be higher, as automation retains or increases the existing value, and the displaced/retrained workers produce yet more value even if I accept the premise that it's limited.
That was sound economic theory somewhat before the digital age and zero marginal cost.
Before, to make more of x you needed more people, input goods, etc. But, when it comes to digital goods the cost of producing more of $x is 0. The fixed cost to produce Windows for example is high but the marginal cost to license Windows to a manufacturer is 0. No matter how many copies of Windows MS sells, they don’t need to hire more people.
There has never been a point in history where 10 people could produce a $1 billion dollar product like Instagram.
This can't help but to lead to a wider gap between the haves and have nots.
Sorry, maybe there's some misunderstanding. I'm saying that the total value of all goods and services produced by humans today will remain at least as big once you replace the people with robots. This frees up the people to do whatever they want, creating additional marginal value. The sum total of value of (humans) is < (humans + robots). It's probably strictly speaking, double, although I was allowing some wiggle room because of your value system (not judging, just trying to meet you on your turf).
Narrowing the gap between the haves and the have nots is something I'm incredibly passionate about too. However, the way to do that IMO isn't by making the have-nots hit things with a hammer in a factory or root around in the ground for shiny rocks while longing for the good old days. It's going to take real social reform and hard work.
I'm saying that if it use to take 10 people to create 100 widgets that people want every time that you wanted to produce 100 more widgets you needed 10 more people.
With digital, 10 people can produce 100 virtual widgets, 1000, 10,000 or 10,000,000.
Those 10 people are going to get rich (i.e. FAANG software developers) while a lot of people are not going to have anything productive to do where they can make money.
History shows the more developed a society (specifically correlated to education and income) the lower its birth rate [1]. Japan is a great example, their population is shrinking (1.44 births per woman vs. a replacement rate of 2.1) although the correlation is universal. Automation leads to development which leads to declining population. IMO the answer is basic income until the population naturally right-sizes, followed by a balance of immigration with social policy either encouraging or discouraging raising children as appropriate.
I think it's more elitist to get people to toil away, spending their time doing something we could automate instead, because you think it's better for them to be kept busy than to set them free to do something more creative and meaningful.
Do you really think companies that don't automate are doing it for the good of humanity and to keep people busy? I would draw no "meaningfulness" from anything that you probably consider "liberal arts".
It's simply not economical to automate every job yet, although that time is fast approaching. Do you not see automation getting cheaper, more reliable and more accessible in the future? Would you put your own money on that prediction and invest in people-forward manufacturing companies instead of companies like ABB? Regardless of your feelings towards how I presented it or your value judgement or meaning, this change is coming, and we need to prepare. We can pretend it's not and get lapped again by countries that do, or we can lean into it and get there first, build a society around it where people can still create value and meaning even if menial and manual labor is automated.
Products produced by manual labor will be more expensive than ones that aren't. They largely already are. If the US wants to double-down we'll need to tax robots and apply tariffs to artificially raise the cost of goods produced through automation to even out the discrepancies in efficiency. Is that the path we want to go down? Or would you rather face facts and structure a society, take the yoke off the proletariat (haha) and allow all your fellow countrymen to benefit from the gift that is not having to do manual labor? Wanting your fellow man to toil away in a factory to support your lifestyle is the ultimate elitism.
It's like saying we should go back to the slide-rule because there's good jobs in making them, and you get that down home country feeling using one. I'm not going to be putting my money into slide-rules, I'll stick with Intel.
Will automation get cheaper than paying people basically nothing overseas like the garment manufacturing industry and to a lesser extent the electronics industry - like Foxconn?
I’m not arguing for not making progress, but the more we become a digital economy, the more you will have a few fortunate people who work in businesses with 0 marginal costs and make a lot of money and the rest doing the unglamorous poorly paid work.
>> Will automation get cheaper than paying people basically nothing overseas like the garment manufacturing industry and to a lesser extent the electronics industry - like Foxconn?
(a) Unequivocally, Yes. (b) The cost of manufacturing goods in China is within 5% of the cost to manufacture within the US, the difference is the US has cheaper power and China has cheaper labor. If we remove the labor it will be cheaper to manufacture in the US with machines than China with labor, for instance. I'll try and find the economist article where I got this information from.
In fact the promised Foxconn plant in the US was/is going to be almost entirely automated. And why wouldn't it be?
>> I’m not arguing for not making progress, but the more we become a digital economy, the more you will have a few fortunate people who work in businesses with 0 marginal costs and make a lot of money and the rest doing the unglamorous poorly paid work.
This is a social problem, as I mentioned, and the solution isn't to make the lower classes hammer things all day and root around for shiny rocks. That at best slows down the process, it does nothing to reverse it. The solution is to revisit social contract. It'll be a big change, and it will be worth it.
- technical roles. The discussion already veered in that direction in the other replies - discussions about 0 marginal costs and how a few people can scale a product to reach millions.
- small business. They don’t earn that much on average, have high capital investments and a lot of times they end up working so much just to keep expenses down their hourly rate is abysmal. Not even considering the number that fail.
Sure, but if a machine can do something cheaper and safer, we shouldn't have humans be doing that work. The people who were doing this dangerous work could be more-efficiently used somewhere that hasn't been automated yet.
I'm sure there's going to be some legitimate criticisms (they don't have many low paid workers; they're only doing this to win favor with the democrats; he still makes too much money; etc) but I don't really care.
It's a good thing to do. They didn't have to do it. They did it. I'll judge people on their actions first, intentions second.
The concerns you list don't stop this from being a good thing, I agree. My bigger concern is what BoAs rate of low-wage direct employees versus contractors looks like, and will look like in the future. The overall trend seems to be that contracted service work is paid somewhat worse than direct, but also faces no benefits, high firing rates, and far nastier working conditions. I don't have numbers on BoA, and I doubt they'll publicize them. But my concern is that moves like this (without a corresponding guarantee for contractors) create an incentive to offload ever more work into conditions that might be even worse than the current state of affairs.
I don't want to undersell this, though. I doubt bank tellers will become contract labor anytime soon, and this will actually represent a significant raise for them.
I wonder of 'trickle down economics' works when the money is injected more closely to where it's supposed to trickle from?
While I don't think Bank of America has a large percentage of skill workers compared to knowledge workers I think this sends a very forward thinking message.
The debt waters are rising for both consumer and corporate and I assume we'll see a correction soon that once again hits middle class and lower class folks _almost_ ready to make a mobility play.
$20/hr during the coming lean times could be just enough to keep some folks from losing too much ground.
I'm just guessing at the rationale but it does kind of make me want to switch banks in support. Next few years could get rough for +60% of the US population.
Personally I've had B of A for years, they offer a variety of products but I've found them nickel and diming me while offering practically zero interest on the savings I leave there, lest I incur 5 dollars monthly for not having 300 bucks in savings.
BoA basically wants you to open up an investment "savings" account with them, and allow them to use your money to play in the market.
It's why their interest rates are abysmal.
Beyond that, on the consumer end they charge rates for random things unless you keep a significant amount of money in your accounts.
If you do then they basically charge you no money and call you once a week begging to redistribute your savings into something with "greater returns" by which they mean stocks.
>>I wonder of 'trickle down economics' works when the money is injected more closely to where it's supposed to trickle from?
That's specifically not trickle-down economics. That's just a economics. If you give more money to people, you're just giving more money to people.
The whole point of a trickle-down is that if you give large sums of money to already rich and powerful individuals, typically in the form of tax breaks or subsidies, then they will invest that money in sectors that create jobs which allows the wealth to trickle-down to the people you're positing to help.
I'm not here trying to talk about the merits of either, just pointing out that this is an entirely different style of economics.
I'm not sure I follow. A very big company that benefits from many subsidies and government assurances used those profits gained to improve the lives of it's workers. It very literally _trickled down_ from benefits given to the top.
Is it though? I heard that when ATMs were introduced, and tellers are still around. There's no shortage of banks in my town, each surely stocked with tellers. What's threatening tellers now?
But how many tellers? And what other duties do they have besides performing customer transactions?
I was a teller back in the mid-nineties, and even then, depending on the branch, we almost never had a full teller line. There were maybe two full-timers, and the rest (3-4) were part-time and scheduled to cover peak hours.
My Chase branch in KTown in Los Angeles literally always has a wait. I have gone at least a dozen times during the week and there have always been at least 4 tellers solely manning the transactions. The line for the tellers is invariably over 10 people long.
Other bank employees handle new accounts and whatnot.
In my opinion, people don't have to go to the bank as much anymore. The only reason I would ever go to the bank was to deposit checks, but you can do that on your phone now.
except when the checks are very large or if you need to deposit a lot of them. I've never hit these limits, but it constantly tells me that I can only do up to $10k/day I think.
My bank Coastal Federal Credit Union (I think they’ve rebranded but I can’t keep their new name in my head) has started using video tellers for most things and then a few people in the back to handle everything else. It’s pretty convenient because it lets them have 7-7/7 hours instead of the shorter usual hours.
This kind of goes in direct contrast of another comment I made, but they seemed to like to have people self serve instead of come in to the bank. I don't know if this was based on expense or survey reviews or some combination of the two or maybe even something else entirely.
Same can be said with call centers now. The direction is to have callers stay in the IVR and not go to a rep. The rep's aren't exactly going away any time soon, but that's the dream.
What's threatening tellers? The fact that it's entirely possible to do all personal banking without ever speaking to a person? It's mostly old people and the tech illiterate keeping them around. In 30 years I doubt they will exist in regular consumer banking
I'm surprised bank branches even exist in the numbers they do, what an incredible expense. Don't think I've set foot in one for five years, besides heading to the ATM.
In more developed (read less politically captured) countries banking tasks are automated, ubiquitous, quick, and free. Take New Zealand for example. Sending 25 cents immediately to a friend to cover the cost of a cookie takes a few taps. Salary and rent is paid automatically directly to bank accounts every week. Bills, utilities, govt all on same system.
Here in CA one birthplace of the internet, I have to print a paper check for the landlord like it's the 70s.
You can send money easily with a few taps in the USA also.
I haven’t written a paper check to a landlord in over 15 years (but I had to do the money bags thing for a few years in China). Heck, even if they don’t have online payments setu, you can usually just auto send them the money as a payee (I do this with my daycare). It’s annoying when I do need to use a paper check once or twice a year, I just go to the bank for a temp check (which is the only time I visit a bank branch also).
My wife used Zelle to transfer money to my aunt when we went shopping at Costco a few weeks ago. It didn't seem hard at all, similar to how she would do it with WeChat back in China. Granted, this isn't something we have to do in the states very often, and maybe it falls down in general?
I'm still very surprised you have to write a paper check for rent. Your landlord doesn't have online banking? Even if you have to use your bank's online bill pay feature, they will issue and send the paper check for you if your landlord doesn't accept online transfers. For me, my rental management company has online payments, my daycare uses bill pay, everyone else is online or what not, except for some child development classes I'm taking at the local college, which still require paper checks for tuition.
Bill pay prints/mails the check. Still ridiculous when the internet is almost 40 years old. Numerous work arounds and excuses described here demonstrate a kind of stockhome syndrome regarding banking and taxes in the US.
I feel like that's situational. I live in very flyover rural US, and the only time I use a check is to pay for my electric and internet, even though the option is there for electronic payments. I only do that because the companies are awful and I'm trying to inconvenience them in a small way. And there are definitely ways to pay other people via electronics.
That sounds like more like your landlord is antiquated, not banks. Not only does Venmo exist as an all-inclusive payment option, every major bank (i.e. not a local one with <15 branches) I'm aware of supports or provides a similar service like Zelle which is used by Bank of America, TD Bank, and others. I'm able to live my life almost entirely independent of banking at a physical location with the rare exceptions being obtaining a cashier's check and withdrawing or depositing large sums of money. There are regulatory/legal hurdles surrounding daily maximum transfer, withdrawl, and deposit amounts as well as what kind of reporting is required for really large sums (like the check you get at closing when you sell your home for example) but this is also the case everywhere else in the 1st world AFAIK.
Just what I want, an unwarranted rent-seeking third-party in between my financial transactions. No thanks. Not after experiencing better. The taps mentioned are instructions for my bank to send money directly to another account now or tonight.
I've heard Zelle is supposed to be some consortium and may be better, but it is still twenty years late and hardly ubiquitous.
Another anecdote. I went to the bank to get a proof of funds statement to purchase a property. Rather than just having some automated thing I could either print by myself, or have the teller/banker print off, the banker proceeded to take an old version of the PDF (one with other people's names in all the fields) and one by one change the value of each field. In the end, one of the fields was wrong and he had to fix it and reprint it. This process took at least 15 minutes, when it should easily have taken 15 seconds.
There's also an opportunity in having people work with one another. For instance, we were always instructed to try and get the client seated with one of our office reps. Whether it's to look at their current loan situation or sign them up for a new credit card.
The invention of the atm paradoxically led to there being MORE branches, not less. There's a bunch of articles about it but basically ATMs reduced per branch labor costs, because a lot of the work was automated. Branches are like huge advertisements for the bank, and people want nearby branches. So we wound up with more branches and even more tellers.
If nothing else, it signals to the rest of corporate america, which might actually have more people that would benifit from this, that it's cool to make these kinds of moves. That's a good thing, or at least not a bad thing.
Probably a lot of female relatively low paid back tellers - could even bring cleaning and janitorial back in house (and hire mostly men) as that would make the pay disparities look better.
I'm curious what percentage of their workforce was below this rate to begin with? I'm assuming the jobs that would be most affected by this are contracted out and won't be affect after all.
Bank tellers start out at about the same as some retail/fast food workers.
In the past, to make $20/hr you had to be a 'personal banker' where you had to push products like checking accounts, loans, and retirement accounts on your customers.
Of all the service sector jobs, bank tellers being underpaid is the most ridiculous. If you are a bartender, I expect you to understand drinks. If you are a musician, I expect you to listen to music. If you work in a bank, I hope you have some financial stability!
Aren't bank teller wages determined by the market? I don't see how they are underpaid if their salaries are market driven.
Edit: Strange. Getting some down votes. Is it because bank teller wages are not market driven or is it pointing out that fact is discouraged on this site.
This will also attract more people to want to work for BoA, right now their average teller salary is $13/hr so this is probably an amazing improvement.
Now let's just make sure they don't replace employees with lower-paid contractors. I'm always suspicious when these minimum wage hikes don't talk about contractors.
> The move is also a sign of increasing wage inflation for thriving companies.
This phrasing doesn't sit well with me. If the company is thriving, as it is, then why would you term a wage increase as "inflation"? The wages aren't tied to "shareholder value" or other metrics the BoD discusses before setting executive compensation.
Also, the article should be retitled to "BoA raising minimum wage to $17", or "plans to raise wages to $20 by 2021". Makes it sound like fait accompli otherwise, which it certainly is not.
For employees who are paid by the piece (paid in proportion to how much they produce) inflation with consist of paying more per piece.
But these employees are paid by the hour. Regardless of how productive they are, they are getting paid to fix salary per hour of work. I think productivity does not factor in at all.
Inflation is an average across all products, weighted by how much the average person spends on them.
A single price increase is not inflation, any more than a single stock going up means that the market went up. It might be a sign of inflation, or it might be offset by decreases in other prices.
I think it has nothing to do with the company thriving. They have to do this now that more and more states are moving fast food order takers to $15/hour. There has to be some upside to work for BoA instead. Raising minimum wage will definitely force low end wages up but my worry is will it also raise prices by the same percentage (within some small timeframe) such that the employees buying power remains the same. The question is always "What can you buy with the money you have left?". I also worry that this devalues people who went to trade schools for low wage jobs, things like an EMT. They may only be making $22/hour and they invested a lot of time and money to do better than fast food. I don't know if there is enough money to give these people a percentage raise even to maintain their buying power. These economic systems are super complex and interesting (even though I barely understand them).
>Raising minimum wage will definitely force low end wages up but my worry is will it also raise prices by the same percentage (within some small timeframe) such that the employees buying power remains the same.
Fortunately the recent increases in minimum wages in several US locales means that there is quite a lot of data available for studies that assess the impact of minimum wage increases on prices.
For example, from "The Effects of Increasing the Minimum Wage on Prices: Analyzing the Incidence of Policy Design and Context (2016)" [0]
>By looking at changes in restaurant food pricing during the period of 1978–2015, MacDonald and Nilsson find that prices rose by just 0.36 percent for every 10 percent increase in the minimum wage, which is only about half the size reported in previous studies. They also observe that small minimum wage increases do not lead to higher prices and may actually reduce prices.
The interestingly-named page "$15 Minimum Wages Will Substantially Raise Prices" [1] from the Heritage Foundation cites multiple studies showing that a 10 increase in minimum wage will increase prices between 0.2% and 1.8% with most estimates around 1%. (Perhaps their definition of substantial is different from mine?)
>Sarah Lemos of the University of Leicester surveyed roughly 30 studies conducted before 2005 examining minimum-wage price effects. These studies found that minimum-wage increases have relatively small effects on the overall price level. They reported that a 10 percent minimum-wage increase raises overall prices by about 0.2 percent to 0.3 percent.
>Researchers at the Federal Reserve Bank of Chicago and the Department of Agriculture, published a study in 2008 examining how restaurants respond to minimum-wage increases.
They used Consumer Price Index (CPI) data and examined the 1996–1997 federal minimum-wage increase. They found that a 10 percent increase in the minimum wage raises overall restaurant prices approximately 0.7 percent. Unsurprisingly, they found larger effects in restaurants that employ more minimum-wage workers. Prices increased twice as much—by approximately 1.5 percent—at fast-food restaurants. In lower-wage regions, fast-food prices rose 1.8 percent.
>In 2010, Denis Fougère, Erwan Gautier, and Hervé Le Bihan, researchers at the Bank of France, criticized the econometric model that Aaronson and his co-authors used. [...] They concluded that a 10 percent minimum-wage increase raises restaurant prices by approximately 1 percent, although it takes one to three years for price increases to fully materialize
>This survey records the price of a McDonald’s quarter-pounder, a regular Pizza Hut cheese pizza, and Kentucky Fried Chicken fried drumsticks across America. They found that a 10 percent increase in required starting wages raises the price of burgers and pizza by about 1 percent. Curiously they found little effect on KFC chicken prices.
It also doesn't necessarily sit well with me. Yes, inflation can cause wages to rise, but the real issues are the disparities between the pay of the top employees and the lowest employees. If this lowers the (percentage) gap by a significant fraction then it is a net positive IMO.
This is nice, but it's important to realize this headline is not really about minimum wage. The debate about minimum wage, of course, is about how wages should be set by law, not about how much companies choose to pay their employees.
That debate is simple, though. They shouldn't be set by law, because it removes jobs from the market and disproportionately punishes businesses that rely on low-skill employment. Why is McDonalds morally responsible for rectifying the problem of poverty, but SpaceX and Microsoft are relatively unaffected? And we already know that minimum wage laws simply accelerate us towards the threshold where employees priced out versus automated alternatives. There are also entire industries that could become economically unviable despite the fact that the employer and employee had previously agreed to the terms of the employment arrangement.
UBI or infrastructure spending are much more sensible solutions to what is a much broader problem.
You mean like the state through pension funds invest in VC funds that subsidize money losing companies who can then pay high salaries to white collar workers?
If companies that can’t be profitable and pay a wage thst you think they deserve shouldn’t exist is kind of a dangerous thing to say on a site supported by a VC company....
Realy was thinking about the tax credits system in the UK ie benefits paid to low paid workers.
And to be blunt if I was a LP / Shareholder in a fund/company ran by PG I absolutely would expect hi to invest in companies that will be profitable and not rely on government subvention to be profitable.
I am a small shareholder in PE investment companies both UK, USA and elsewhere.
Bank of America made it to my permanent boycott list after they bought my MBNA credit card and my mortgage, and then proceeded to pull every possible shenanigan to try to squeeze more money out of me.
The next note I write will have a clause specifically saying that if it is ever sold to BoA, or serviced by them, the remainder of the debt owed on the note will be discharged immediately. And if that scuttles the financing, so be it. I never wanted to be their customer, and they forced me into it; that's the only way I can think of to keep their business practices out of my life.
I moved to ING which was absorbed by CapitalOne. I've had very few problems with CapitalOne. There are no branches near me so I occasionally have to ask friends to write me a check if I have some cash I need to deposit.
I half-heartedly looked for a credit union to join, but every one I found seemed to be for groups of employees I'm not a member of.
I work for Bank of America Merrill Lynch (BAML) in London; I've been here 18 months as a contractor, and I'm switching to perm. Why? Because BAML is hands down the most pleasant, civilized and supportive investment bank environment I've encountered in 22 years in trading systems development with Chase Manhattan, JP Morgan, Deutsche, CIBC and Barclays. Work life balance, and "bring your whole self to work" are not just slogans here.
I mean off the top of my head: More and more states are passing $15+ minimum wage laws and they'll need to compete, because saying you pay people more without context (like how many people will be laid off or converted to contractors) can be good PR, because you realized you were already paying all of these people approximately that rate so you can just streamline your hiring negotiations and save money.
To me as someone who is in no way expert on automation or an economist but someone who knows how profit oriented big business is, especially banks, I have a question: this looks to me like they expect so much automation happening in the future that they can afford the move? Isn't that case with McDonald's too, where they can have self-serving locations in near future, so no problem with raising minimum hourly rates?
The ATMs nowadays do so much on their own. I was taken by surprise when last time I had 5 of my checks scanned and deposited cash into my checkings by a <big bank name here> ATM recently. No human interaction what-so-ever. So I can withdraw money using ATM, I can add money using ATM, and I can cash/deposit checks using ATM. Isn't that like 99% of what their 90% customers do? Isn't that the case that in 5-10 years they will need one person on premises to handle the remaining cases? So then that person can be making 20usd/hr, why not? If they're replacing 4-5 other workers, this is savings anyway.
Of course this won't touch things like mortgages or auto-loans. For now that is...
Agreed. And ever more so, the mobile apps do a ton themselves. I absolutely love that that I can just deposit checks right from my banking mobile app, instead of having to go to the bank or an ATM.
The only thing that's really new in the last 10 years (or more) though is depositing through mobile apps. I've been doing that with ATMs for a very long time.
I maybe go into a bank branch once every couple of years for some reason or another. I'm always a bit floored by just how much prime retail real estate bank branches consume in a typical city. I guess it's a form of advertising. (Of course, the same thing is true of mobile phone stores.)
This thread is plagued by a rather insidious idea that has bubbled up in recent history: the idea of "human capital" in terms of the "greater good".
Sentiments like "people shouldn't be doing jobs that can be automated" or "machines should do the work instead, we need more useful jobs for those people" stink of the ideas that 1) people must serve some societal purpose, 2) that they are not fit to decide their own purpose, and 3) they are not fit to determine what has value to them.
These values are actually now embedded in U.S.A. policies and major non-profits, like "No Child Left Behind", and the Gates Foundation, or "School to Work". (A tangent: we aren't enabling people to learn and to think, we are teaching them to follow directions. Curiosity seems to be a waning capability of many kids and we seem to be slipping towards a Soviet style of teaching in public schools - which discourages self-generated thought and questions.)
I'm not bringing this up because I'm a Luddite. I rather like the idea of automating things, actually. I don't think our current, popular, justifications are healthy.
Rather, on an interpersonal level, I think some of the justifications in this thread are codependent, controlling, and uncaring.
As I’ve grown older and started focusing more on politics and the state of the nation, I started realizing that reconciliation is not abundant in the US politics and minds of people. Your comment is one of example.
There are comments about increasing automation and policies of that effect but no policy or recognition how job losses will be coped with. Apparently it’s ok to permanently remove jobs but universal basic income is non-negotiable.
Another example is cutting of taxes, but then increasing expenditures. Or not increasing taxes as expenditures go up. Somehow things just don’t reconcile. Maybe that’s just how politics is. But if there was reconciliation of things, we would be in a better place (or an even better place?)
> Apparently it’s ok to permanently remove jobs but universal basic income is non-negotiable.
Are you generalizing across all "young people"? Or are you assuming what I mean? I was not trying to argue that we as a society, and especially as individuals, shouldn't help the displaced. What I have a problem with is the essentially Communist rhetoric we are using to justify removal from and placement in jobs.
> Or not increasing taxes as expenditures go up. Somehow things just don’t reconcile. Maybe that’s just how politics is.
A frequent conversation between a close friend of mine and myself is one that highlights these inconsistencies. I think the core issue is a fundamental lack of understanding on the part of the politician/person. We call it "bumper sticker" politics. Everyone wants a drop-the-mic moment, the feel vindicated, to feel justified, to feel right.
It is a scary thing to be wrong, even about trivial things. If a person possesses functional introspective capabilities, being wrong about something can shake a person's sense of identity.
Generally, I think that fear is the cause of 1) lack of introspection, which leads to 2) "yelling" meaningless phrases in an attempt to articulate a political opinion they don't understand.
>Are you generalizing across all "young people"? Or are you assuming what I mean? I was not trying to argue that we as a society, and especially as individuals, shouldn't help the displaced. What I have a problem with is the essentially Communist rhetoric we are using to justify removal from and placement in jobs.
I think we are on the same page. I was just saying that if we are moving towards automation and the corporations are going to push for it, policies should be in place beforehand to help those displaced. Specifically from the profits of that automation. Not even the tax payers. Then as the whole industry shifts, the social services can be used to compensate whole populations. I am not writing policies and I am definitely not an expert. But the conversation of automation and job removal should include compensation for those displaced.
>I think the core issue is a fundamental lack of understanding on the part of the politician/person.
Yes, I agree. And the rush to prove the other side wrong. Which is usually accompanied by extreme examples and unfounded rhetoric.
> There are comments about increasing automation and policies of that effect but no policy or recognition how job losses will be coped with. Apparently it’s ok to permanently remove jobs but universal basic income is non-negotiable.
You're right! This is a huge, glaring, obvious contradiction.
I've always found it useful to extend the principle of charity in situations like the you so wisely point to. Perhaps people have some reason to expect that some other outcome could result from permanently removing jobs other than a permanent reduction in the number and type of jobs available? Do you think this is possible? Maybe these people might opine that our economy is not a fixed-size lump of labor.
Again, you very correctly point to a absolutely critical point. Might perhaps there be something else to consider here? If I'm wrong, and the world is indeed a fixed lump of labor, can you help me understand why these people are wrong?
>Might perhaps there be something else to consider here? If I'm wrong, and the world is indeed a fixed lump of labor, can you help me understand why these people are wrong?
I don’t think the world is a fixed lump of labor. Eventually there will be enough automation that people won’t have any work to do. Not everybody has the capacity to be a doctor or an engineer or a lawyer. We are just not wired that way, the brain simply works in unique ways. So how do we take away labor intensive work and still expect people to live happily while not providing them with means of living. I think there are two ways: (i) provide people with social services so they live above the standard of poverty. (ii) split automation so only so much work will be automated. This is a good compromise as we find out what automation does to our economy as years go on. For example(don’t shoot me, these are just examples), Mc Donald’s must have people working for the same amount of automatic kiosks in their restaurant. Or half of amazon warehouse must be people and half must be robots. Half of automatic Ubers must be driven by real people.
There are ways to do automation and still take care of people. I just don’t see that conversation and it’s bothersome because soon it will too late.
That's very intersting! Thank you very much for sharing.
You might think about pausing to consider that you have described what economists call the lump of labor. This is the idea that there's a finite amount of work to go around, and it can only be distributed among various people or machines. Some might opine that there could be something to be gained by investigating writings and studies on this exact subject from the past century or more. Wikipedia can be a great starting point - https://en.wikipedia.org/wiki/Lump_of_labour_fallacy
I have had a very different experience. I see the conversation you call for going on constantly. I see it among dozens of people I know personally, of many different ages and races and education levels and careers. This is enough to lead me to think that your idea is so good and so wise that it's already been adopted en masse!
I think one important alternative you missed was allowing people to create businesses easily.
Given the opportunity, many people find problems to solve and build businesses around that solution.
By simplifying the process of starting a business to "just do it" and simplifying the tax implications of hiring and firing people, I don't think we would see a need to "create" or "preserve" jobs.
Oh definitely! I missed that one. That could be a solution. See, this is what I want. Have the conversation and the policy changes that come with the industry shifts. It only helps everyone.
In this particular case, the conversation you want happened over a century ago when economists figured out that automation tends to create (and enable the creation of) more jobs than it permanently removes. Economists figured out that the idea of the lump of labor is possessed of bountiful opportunities to come into greater alignment with observed reality. The whole industrial revolution involved a lot of people who shared your fears - that their jobs would be permanently removed by automation!
And you know what? They were right! Their jobs were permanently removed by automation. It's just that the story didn't end there, and the jobs created and enabled by automation far outstripped the jobs removed.
It might be worth considering that government intervention might not always be the solution. Choosing not to act is always an option, and is always worth considering. The first question should not be "How can we solve this problem with policy?", but instead should be "Should we solve this problem with policy?".
So we are back to square one. If automation makes whole populations jobless, then we should be ready to take care of them. If it doesn’t, we are good as we were. Therefore, if automation makes unemployment go up, those unemployed should have a plan waiting for them that makes sure they live above the poverty line.
Are we back to square one? The plan so far is that history suggests pretty strongly that automation creates more jobs than it destroys. Actively choosing not to intervene is a plan, although it can easily be mistaken not having one.
There is a reality that no one wants to admit - for some sizable percentage of the population, a 'job easily replaced by automation' is the best they can hope for in life - they're either not smart enough, not driven enough, or have some other issue preventing them from being a rocket scientist - beyond that, there is a limited societal need for highly educated workers - but we have lots of jobs that need just need doing, and are every bit as important, both for societal cohesion and for the fact that they need done - we need to pay those people a fair and living wage.
It comes down to a question - are we as a society willing to pay people to not work - not just starvation - but pay them a fair and reasonable wage for doing nothing - or do we as a society expect to try to get as close to a fair and living wage as possible for everyone no matter how much value they add - provided they are doing some sort of reasonable amount of work - this is the real question posited by automation.
> but pay them a fair and reasonable wage for doing nothing
I subscribe to some limited belief that prices rise (where possible) to meet demand. See San Francisco housing prices, or Madison, WI housing prices as companies attract and pay their employees quite a lot. So, just paying people a "living wage" isn't enough. If that's a route we go in (and I sincerely hope we don't) we need to handle every aspect of living; housing, food, medicine, etc. Just dolling out dollars/euros isn't enough.
> or do we as a society expect to try to get as close to a fair and living wage as possible for everyone no matter how much value they add
Paying regardless of performance will destroy productivity. People tend to do a "gradient descent" algorithm in work, finding some local minima of effort for their pay. I understand not all people are like this. I'm only saying I think that enough people do, that paying some fixed minimum for all no-matter-the-value will destroy economic growth.
If you paid people a wage that didn't tie them to a place, or if they could get that 20 bucks an hour no matter where they lived, they'd likely relocate to someplace cheaper.
What do we do with all the people who's jobs are automated out of existence? Do we prevent the automation from happening, or do we just pay people for doing nothing? That's the question I'm positing.
We allow them to start businesses with little to no overhead. Let them solve problems as they see them and hire people to help.
Even with the explosion of software related businesses, the actual growth of new small businesses has been grinding to a halt [0]. I'd argue that this is specifically a regulation and paperwork issue from local all the way up to Federal levels.
If we want to "create jobs" for people who are displaced, we need to allow for new jobs to be created. The government can't "create" jobs, no matter how much money it has or taxes it levies. Unless everyone works for the government. Then we're on our way to some kind of bureaucratic totalitarianism.
I'll note - at no point I mentioned the government as a driver in this - this is a societal question - government might be the mechanism to do it - but government cannot initiate it - we as a society must form a consensus on what to do with the displaced first.
Broadly I'd also agree with you, the regulatory environment makes running any sort of business needlessly complex and difficult, and tends to increases the capital requirements greatly - though I'd argue that state and local regulations are the primary burdens at this point.
It certainly helps to make it easier to start businesses. I think it's a great idea, but even in the most optimistic scenario though it is a fractional (but worthwhile!) solution. Reducing bureaucratic burden and improving access to capital can make a real difference though.
You're referring to a type of supply curve that rises sharply to the right as demand increases and where that supply curve has limited ability to react in a new equilibrium. Small increases in demand result in large increases in price but extra supply cannot be brought to the market to push pricing down.
This is mostly true in cases with artificially limited supply. You mention real estate, which is a good example in cities where (1) large employers are moving in, (2) zoning is constrained, and optionally (3) extra land is difficult to get, either because of geography or sprawl.
Most goods are not like this. Food, for example, does not typically have permanently higher prices after an increase in demand, because the supply curve will also change (additional supply is provided).
Same with televisions, cars, refrigerators, computers, household consumables, etc.
Therefore, I don't think it makes sense to throw out the baby with the bathwater: yes, real estate is not a normal market for a variety of reasons, but that doesn't mean that spreading dollars around doesn't work for everything else.
Real estate may need some special solutions, such as relaxing zoning laws, housing subsidies, evaluating code impact on construction costs, mass transit investment to increase travel efficiency, property tax on vacant properties, etc.
> are we as a society willing to pay people to not work - not just starvation - but pay them a fair and reasonable wage for doing nothing
This will be exceedingly difficult in the U.S. where there is this deeply ingrained cultural belief that a living is something that must be “earned”. Basic Income and other safety nets that let people survive without working for it would be politically difficult. We are more likely to have government pay 1/2 the people to dig holes and the other 1/2 to fill them in, than have something like Basic Income here.
Consider an alternative angle - Companies, as rational actors, will eliminate automatable positions. Unless you're suggesting some sort of deliberate intervention to save these jobs, they're gone.
The next question is how do we assist those displaced by automation. There are multiple proposals including UBI and its ilk, but the most palatable bipartisan idea is to find them new jobs.
The idea of finding 'better' jobs with more agency, etc. is not immensely new - it draws from organization research on employee fulfillment and productivity.
Overall, no one is saying that any specifically displaced individual needs to take up <new job> in some sort of imagined totalitarian state - they're perfectly free to choose a new job from the market. The only question is one of skills and motivation.
I'd suggest people learn how to do plumbing and electrical work. It's not work that can be easily automated, and plumbers are often charging more than lawyers.
The fact is, there is a LOT of room for people to work and grow. The typical factory job is significantly waning, and will continue to do so. Local service oriented jobs are far less likely to be outsourced at all. "Dirty jobs" in particular tend to pay well, and are pretty damned safe from outsourcing.
The bigger issues are more societal and likely to worsen with roughly 2/3 of those in higher education being women, and over 70% of women unwilling to date/marry those of a lower social/education status, even with matching income.
The highest satisfactions in life, generally speaking, come from earned work:income and family engagement.
> I'd suggest people learn how to do plumbing and electrical work. It's not work that can be easily automated, and plumbers are often charging more than lawyers.
It mostly just that people don't understand what automation is, and especially not many of the self-proclaimed experts. You automate things like electrical work like you "automate" Uber, by making it unskilled. You put all the logic in the terminal, if not the cables, so almost anyone can do it. In a longer time span you might just change the whole wiring to something else, like lower powered dc.
That said there is no need to go crazy. We are undergoing a second industrial revolution with information instead of energy, but overall the same rules apply. If we just make things better for people we will be alright.
> I'd suggest people learn how to do plumbing and electrical work
This might be a solution for some people, but it's not a long term solution for everyone. As people age, their bodies deteriorate. An injury might put someone out of work temporarily, or forever. Manual labor becomes more difficult, or outright impossible, for people entering their 40s, 50s and 60s.
>The bigger issues are more societal and likely to worsen with roughly 2/3 of those in higher education being women, and over 70% of women unwilling to date/marry those of a lower social/education status, even with matching income.
Depends on your perspective. As a single man with his life together in his early 30's I'm finding life good. Is this societies problem or a problem for these women?
As society is dependent on a growing youth to support senior care, it depends on your POV.
Because you specifically are doing well, doesn't mean society is. Directly, the women in particular are not harmed, but statistically less happy. Changing perspectives on a broader level would help a lot in any case.
Growth cannot continue forever. At some stage we will need to stabilise or reduce the population. I'm expecting that I'll be working until close to 70 and I think others should prepare for the same. If you're hoping for 35 years of retirement then you should have a lot of money put aside.
As for women, this is their own choosing. If you want to "have fun"
with the most attractive men (looks, status, wealth) you can from 18 to 28 before you look for a partner then you shouldn't be surprised when the men who will settle down with you don't live up to the standards you're used to. There is only so many of these men and they're happy to oblige fun but commitment isn't so easy. There was a post yesterday showing how many young men are completely missing out on sexual interaction.
Electrical/plumbing is a great idea. The ultimate job I think is robot repairman, because by the time that is automated we're all screwed anyway.
But consider exercise. Society automated a lot of manual labor and people still need to exercise, even though it's a blatantly wasteful use of energy. It's even more inefficient than digging holes and filling them again, because it's not even good for the soil. But it's important for people to do it.
To me it's not the matter that "people shouldn't be doing jobs that can be automated" or "machines should do the work instead," it's that in a capitalist system, these changes are inevitable. As soon as these jobs start to be automated out of perfectly sound capitalist motivations, the dollar value of a human performing that task is going to fall precipitously, to near-zero.
Clearly we need to figure out how to keep those people compensated enough to survive, possibly through changing to work that our economy values sufficiently, through subsidizing them from those same gains in efficiency through automation, or via some means not yet discussed.
Everyone I've known out of a Soviet era education seems to feel it was quite a bit better than US education. Early bucketing by ability, allowing those who can to succeed and those slower learners to work with others at a more comfortable pace. As long as people are able to move in/out of grouping based on skill and effort, I'm not sure it sounds so bad.
I'm not sure the U.S. changes in education since the 80's especially in K-12 have been productive, both administratively and structure. I was talking about letting those that can learn more math, or better language/communication skills being able to do so at a younger age, and not holding them back to keep everyone the same (lowest common standard) on a larger scale, not just for the wealthy.
You say "codependent" like it's a bad thing. What's so great about individualist thinking? When finding meaningful work, why shouldn't we consider what other people want? And why should people have to figure it all out on their own?
I think you are confusing "societal value" with "things people are willing to pay for". Like a coffee shop. Another coffee shop doesn't hurt society, nor does it benefit society at large. Even on the scale of a small town, a coffee shop adds nothing of intrinsic societal value.
But people still want their caffeinated milk shakes and misnamed espresso sugar drinks, and they will pay a premium for their fix.
They've probably outsourced most of their cleaning and cafeteria services, so not sure if that is inclusive. Otherwise it's not really surprising to see salaries in that range.
"On June 3, Nyerges, two sheriff's deputies and a moving truck showed up at the local BofA branch. The deputies informed the manager that he could either pay the Nyerges' legal fees— $2,500—or the movers would start taking away the bank's furniture and cash"
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[ 2.2 ms ] story [ 158 ms ] thread[0]: https://www.nytimes.com/2017/09/03/upshot/to-understand-risi...
I wonder if they're going to do something like my employer, and mandate minimum wage and benefits for all of their contractors as well? https://www.forbes.com/sites/rakeenmabud/2019/04/09/googles-...
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This move is basically meaningless if it doesn't extend to the temp agencies and businesses BoA buys labor from and contracts with to provide basic services (custodial, POS systems support, etc.). Sure the gesture is nice but it's hollow. Modern BigCos don't hire for low skill, low wage positions unless it's part of their core business. They contract all that out, either they get bodies from temp agencies or they get the entire service provided by a 3rd party.
The point here is calling out empty PR, but I’m not going to misrepresent an article without proof. I just have suspicions.
This is a terrible attitude.
Many blue collar jobs are perfectly good well paying careers available without crushing student debt to people who (crazy, I know) don't want to sit by a desk all day.
Do you not know anyone that works in a factory? Spend some time in the South, or in the Midwest. You'll find people who do the same thing day-in and day-out. Those jobs still exist.
I get that people in ivory towers will decry it all as horrible but the fact of the matter is that none of those jobs are any better or worse than the other once you account for people's variable preferences. I'd personally rather do outdoor labor of some sort but some people prefer the air conditioned factory floor.
edit/ Also, throwing boxes for delivery companies or warehouses, you'll be standing at the end of your belt filling up trucks for the entire duration of your 8/12/16 hour shift.
That's just not true.
Come to flyover country. There are many, many jobs that are 'stick metal piece in here remove stamped metal piece there' sorts of work.
And that's saying a lot...
If you had a job copy numbers from one spreadsheet into another spreadsheet, would you not write a script? Which do you think would do a better job?
It's not elitist, it's pragmatic. There are definitely jobs that require physical labor that provide meaningful value at the moment, though the days are numbered there too. Japan developed a fully-automated farm. [1] We shouldn't keep them around just because we don't have something better for the workers to do. It's our social obligation to find them something better to do.
[1] https://www.theguardian.com/environment/2016/feb/01/japanese...
But I definitely see more value in the jobs you demean than the "liberal arts".
If all jobs could be automated more cheaply than humans, don't you think they would have done it? There is nothing pragmatic about a liberal arts degree in Ancient Chinese Art History....
>> If all jobs could be automated more cheaply than humans, don't you think they would have done it?
Not everything that's possible has become economical yet. This is kind of the definition of progress :) If all cancer could be cured, don't you think they would have done it by now?
That was sound economic theory somewhat before the digital age and zero marginal cost.
Before, to make more of x you needed more people, input goods, etc. But, when it comes to digital goods the cost of producing more of $x is 0. The fixed cost to produce Windows for example is high but the marginal cost to license Windows to a manufacturer is 0. No matter how many copies of Windows MS sells, they don’t need to hire more people.
There has never been a point in history where 10 people could produce a $1 billion dollar product like Instagram.
This can't help but to lead to a wider gap between the haves and have nots.
Narrowing the gap between the haves and the have nots is something I'm incredibly passionate about too. However, the way to do that IMO isn't by making the have-nots hit things with a hammer in a factory or root around in the ground for shiny rocks while longing for the good old days. It's going to take real social reform and hard work.
With digital, 10 people can produce 100 virtual widgets, 1000, 10,000 or 10,000,000.
Those 10 people are going to get rich (i.e. FAANG software developers) while a lot of people are not going to have anything productive to do where they can make money.
You could say the same about manufacturing.
But what do you propose when there are more structural issues where there just aren’t enough jobs to go around?
[1] https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4255510/
Products produced by manual labor will be more expensive than ones that aren't. They largely already are. If the US wants to double-down we'll need to tax robots and apply tariffs to artificially raise the cost of goods produced through automation to even out the discrepancies in efficiency. Is that the path we want to go down? Or would you rather face facts and structure a society, take the yoke off the proletariat (haha) and allow all your fellow countrymen to benefit from the gift that is not having to do manual labor? Wanting your fellow man to toil away in a factory to support your lifestyle is the ultimate elitism.
It's like saying we should go back to the slide-rule because there's good jobs in making them, and you get that down home country feeling using one. I'm not going to be putting my money into slide-rules, I'll stick with Intel.
I’m not arguing for not making progress, but the more we become a digital economy, the more you will have a few fortunate people who work in businesses with 0 marginal costs and make a lot of money and the rest doing the unglamorous poorly paid work.
(a) Unequivocally, Yes. (b) The cost of manufacturing goods in China is within 5% of the cost to manufacture within the US, the difference is the US has cheaper power and China has cheaper labor. If we remove the labor it will be cheaper to manufacture in the US with machines than China with labor, for instance. I'll try and find the economist article where I got this information from.
In fact the promised Foxconn plant in the US was/is going to be almost entirely automated. And why wouldn't it be?
>> I’m not arguing for not making progress, but the more we become a digital economy, the more you will have a few fortunate people who work in businesses with 0 marginal costs and make a lot of money and the rest doing the unglamorous poorly paid work.
This is a social problem, as I mentioned, and the solution isn't to make the lower classes hammer things all day and root around for shiny rocks. That at best slows down the process, it does nothing to reverse it. The solution is to revisit social contract. It'll be a big change, and it will be worth it.
The Foxconn plant is turning out to be a complete fraud....
https://www.theverge.com/2018/10/29/18027032/foxconn-wiscons...
— technical roles
— small-businesses
— liberal arts
— or whatever it is they want
Misrepresenting what they said is in incredibly bad-faith, please don’t do this, it’s very disrupting to dialogue.
The other ideas aren’t much better.
- technical roles. The discussion already veered in that direction in the other replies - discussions about 0 marginal costs and how a few people can scale a product to reach millions.
- small business. They don’t earn that much on average, have high capital investments and a lot of times they end up working so much just to keep expenses down their hourly rate is abysmal. Not even considering the number that fail.
https://smallbiztrends.com/2018/07/how-much-do-small-busines...
It's a good thing to do. They didn't have to do it. They did it. I'll judge people on their actions first, intentions second.
I don't want to undersell this, though. I doubt bank tellers will become contract labor anytime soon, and this will actually represent a significant raise for them.
While I don't think Bank of America has a large percentage of skill workers compared to knowledge workers I think this sends a very forward thinking message.
The debt waters are rising for both consumer and corporate and I assume we'll see a correction soon that once again hits middle class and lower class folks _almost_ ready to make a mobility play.
$20/hr during the coming lean times could be just enough to keep some folks from losing too much ground.
I'm just guessing at the rationale but it does kind of make me want to switch banks in support. Next few years could get rough for +60% of the US population.
It's why their interest rates are abysmal.
Beyond that, on the consumer end they charge rates for random things unless you keep a significant amount of money in your accounts.
If you do then they basically charge you no money and call you once a week begging to redistribute your savings into something with "greater returns" by which they mean stocks.
That's specifically not trickle-down economics. That's just a economics. If you give more money to people, you're just giving more money to people.
The whole point of a trickle-down is that if you give large sums of money to already rich and powerful individuals, typically in the form of tax breaks or subsidies, then they will invest that money in sectors that create jobs which allows the wealth to trickle-down to the people you're positing to help.
I'm not here trying to talk about the merits of either, just pointing out that this is an entirely different style of economics.
That said - the teller is an endangered position.
I was a teller back in the mid-nineties, and even then, depending on the branch, we almost never had a full teller line. There were maybe two full-timers, and the rest (3-4) were part-time and scheduled to cover peak hours.
Other bank employees handle new accounts and whatnot.
Anecdata: My local branch nearly always has a line 2-3 people deep with 3-4 tellers when I need to nip in.
Same can be said with call centers now. The direction is to have callers stay in the IVR and not go to a rep. The rep's aren't exactly going away any time soon, but that's the dream.
Here in CA one birthplace of the internet, I have to print a paper check for the landlord like it's the 70s.
I haven’t written a paper check to a landlord in over 15 years (but I had to do the money bags thing for a few years in China). Heck, even if they don’t have online payments setu, you can usually just auto send them the money as a payee (I do this with my daycare). It’s annoying when I do need to use a paper check once or twice a year, I just go to the bank for a temp check (which is the only time I visit a bank branch also).
I'm still very surprised you have to write a paper check for rent. Your landlord doesn't have online banking? Even if you have to use your bank's online bill pay feature, they will issue and send the paper check for you if your landlord doesn't accept online transfers. For me, my rental management company has online payments, my daycare uses bill pay, everyone else is online or what not, except for some child development classes I'm taking at the local college, which still require paper checks for tuition.
I've heard Zelle is supposed to be some consortium and may be better, but it is still twenty years late and hardly ubiquitous.
Here's one of the articles about this.
https://www.recode.net/2017/5/8/15584268/eric-schmidt-alphab...
In the past, to make $20/hr you had to be a 'personal banker' where you had to push products like checking accounts, loans, and retirement accounts on your customers.
Edit: Strange. Getting some down votes. Is it because bank teller wages are not market driven or is it pointing out that fact is discouraged on this site.
Great press for BoA perfectly timed where automation will completely remove the need for these low level jobs within 5-10 years.
https://www.glassdoor.ca/Salaries/new-york-city-teller-salar...
Now let's just make sure they don't replace employees with lower-paid contractors. I'm always suspicious when these minimum wage hikes don't talk about contractors.
This phrasing doesn't sit well with me. If the company is thriving, as it is, then why would you term a wage increase as "inflation"? The wages aren't tied to "shareholder value" or other metrics the BoD discusses before setting executive compensation.
Also, the article should be retitled to "BoA raising minimum wage to $17", or "plans to raise wages to $20 by 2021". Makes it sound like fait accompli otherwise, which it certainly is not.
Prices rising for the same product (the same labour) is 'inflation'. That's just the definition of the word.
But these employees are paid by the hour. Regardless of how productive they are, they are getting paid to fix salary per hour of work. I think productivity does not factor in at all.
A single price increase is not inflation, any more than a single stock going up means that the market went up. It might be a sign of inflation, or it might be offset by decreases in other prices.
Fortunately the recent increases in minimum wages in several US locales means that there is quite a lot of data available for studies that assess the impact of minimum wage increases on prices.
For example, from "The Effects of Increasing the Minimum Wage on Prices: Analyzing the Incidence of Policy Design and Context (2016)" [0]
>By looking at changes in restaurant food pricing during the period of 1978–2015, MacDonald and Nilsson find that prices rose by just 0.36 percent for every 10 percent increase in the minimum wage, which is only about half the size reported in previous studies. They also observe that small minimum wage increases do not lead to higher prices and may actually reduce prices.
The interestingly-named page "$15 Minimum Wages Will Substantially Raise Prices" [1] from the Heritage Foundation cites multiple studies showing that a 10 increase in minimum wage will increase prices between 0.2% and 1.8% with most estimates around 1%. (Perhaps their definition of substantial is different from mine?)
>Sarah Lemos of the University of Leicester surveyed roughly 30 studies conducted before 2005 examining minimum-wage price effects. These studies found that minimum-wage increases have relatively small effects on the overall price level. They reported that a 10 percent minimum-wage increase raises overall prices by about 0.2 percent to 0.3 percent.
>Researchers at the Federal Reserve Bank of Chicago and the Department of Agriculture, published a study in 2008 examining how restaurants respond to minimum-wage increases. They used Consumer Price Index (CPI) data and examined the 1996–1997 federal minimum-wage increase. They found that a 10 percent increase in the minimum wage raises overall restaurant prices approximately 0.7 percent. Unsurprisingly, they found larger effects in restaurants that employ more minimum-wage workers. Prices increased twice as much—by approximately 1.5 percent—at fast-food restaurants. In lower-wage regions, fast-food prices rose 1.8 percent.
>In 2010, Denis Fougère, Erwan Gautier, and Hervé Le Bihan, researchers at the Bank of France, criticized the econometric model that Aaronson and his co-authors used. [...] They concluded that a 10 percent minimum-wage increase raises restaurant prices by approximately 1 percent, although it takes one to three years for price increases to fully materialize
>This survey records the price of a McDonald’s quarter-pounder, a regular Pizza Hut cheese pizza, and Kentucky Fried Chicken fried drumsticks across America. They found that a 10 percent increase in required starting wages raises the price of burgers and pizza by about 1 percent. Curiously they found little effect on KFC chicken prices.
[0] https://www.upjohn.org/research-highlights/does-increasing-m...
[1] https://www.heritage.org/jobs-and-labor/report/15-minimum-wa...
UBI or infrastructure spending are much more sensible solutions to what is a much broader problem.
Nurses Doctors etc there is an obvious moral incentive.
If companies that can’t be profitable and pay a wage thst you think they deserve shouldn’t exist is kind of a dangerous thing to say on a site supported by a VC company....
And to be blunt if I was a LP / Shareholder in a fund/company ran by PG I absolutely would expect hi to invest in companies that will be profitable and not rely on government subvention to be profitable.
I am a small shareholder in PE investment companies both UK, USA and elsewhere.
Also I quit using Bank of America years ago because they were more interested in making money off of me via fees than providing any sort of service.
The next note I write will have a clause specifically saying that if it is ever sold to BoA, or serviced by them, the remainder of the debt owed on the note will be discharged immediately. And if that scuttles the financing, so be it. I never wanted to be their customer, and they forced me into it; that's the only way I can think of to keep their business practices out of my life.
I half-heartedly looked for a credit union to join, but every one I found seemed to be for groups of employees I'm not a member of.
There's plenty of reasonable possibilities here.
The ATMs nowadays do so much on their own. I was taken by surprise when last time I had 5 of my checks scanned and deposited cash into my checkings by a <big bank name here> ATM recently. No human interaction what-so-ever. So I can withdraw money using ATM, I can add money using ATM, and I can cash/deposit checks using ATM. Isn't that like 99% of what their 90% customers do? Isn't that the case that in 5-10 years they will need one person on premises to handle the remaining cases? So then that person can be making 20usd/hr, why not? If they're replacing 4-5 other workers, this is savings anyway.
Of course this won't touch things like mortgages or auto-loans. For now that is...
right?
Agreed. And ever more so, the mobile apps do a ton themselves. I absolutely love that that I can just deposit checks right from my banking mobile app, instead of having to go to the bank or an ATM.
I maybe go into a bank branch once every couple of years for some reason or another. I'm always a bit floored by just how much prime retail real estate bank branches consume in a typical city. I guess it's a form of advertising. (Of course, the same thing is true of mobile phone stores.)
Sentiments like "people shouldn't be doing jobs that can be automated" or "machines should do the work instead, we need more useful jobs for those people" stink of the ideas that 1) people must serve some societal purpose, 2) that they are not fit to decide their own purpose, and 3) they are not fit to determine what has value to them.
These values are actually now embedded in U.S.A. policies and major non-profits, like "No Child Left Behind", and the Gates Foundation, or "School to Work". (A tangent: we aren't enabling people to learn and to think, we are teaching them to follow directions. Curiosity seems to be a waning capability of many kids and we seem to be slipping towards a Soviet style of teaching in public schools - which discourages self-generated thought and questions.)
I'm not bringing this up because I'm a Luddite. I rather like the idea of automating things, actually. I don't think our current, popular, justifications are healthy.
Rather, on an interpersonal level, I think some of the justifications in this thread are codependent, controlling, and uncaring.
There are comments about increasing automation and policies of that effect but no policy or recognition how job losses will be coped with. Apparently it’s ok to permanently remove jobs but universal basic income is non-negotiable.
Another example is cutting of taxes, but then increasing expenditures. Or not increasing taxes as expenditures go up. Somehow things just don’t reconcile. Maybe that’s just how politics is. But if there was reconciliation of things, we would be in a better place (or an even better place?)
Edit: spelling loses to losses.
Are you generalizing across all "young people"? Or are you assuming what I mean? I was not trying to argue that we as a society, and especially as individuals, shouldn't help the displaced. What I have a problem with is the essentially Communist rhetoric we are using to justify removal from and placement in jobs.
> Or not increasing taxes as expenditures go up. Somehow things just don’t reconcile. Maybe that’s just how politics is.
A frequent conversation between a close friend of mine and myself is one that highlights these inconsistencies. I think the core issue is a fundamental lack of understanding on the part of the politician/person. We call it "bumper sticker" politics. Everyone wants a drop-the-mic moment, the feel vindicated, to feel justified, to feel right.
It is a scary thing to be wrong, even about trivial things. If a person possesses functional introspective capabilities, being wrong about something can shake a person's sense of identity.
Generally, I think that fear is the cause of 1) lack of introspection, which leads to 2) "yelling" meaningless phrases in an attempt to articulate a political opinion they don't understand.
I think we are on the same page. I was just saying that if we are moving towards automation and the corporations are going to push for it, policies should be in place beforehand to help those displaced. Specifically from the profits of that automation. Not even the tax payers. Then as the whole industry shifts, the social services can be used to compensate whole populations. I am not writing policies and I am definitely not an expert. But the conversation of automation and job removal should include compensation for those displaced.
>I think the core issue is a fundamental lack of understanding on the part of the politician/person.
Yes, I agree. And the rush to prove the other side wrong. Which is usually accompanied by extreme examples and unfounded rhetoric.
You're right! This is a huge, glaring, obvious contradiction.
I've always found it useful to extend the principle of charity in situations like the you so wisely point to. Perhaps people have some reason to expect that some other outcome could result from permanently removing jobs other than a permanent reduction in the number and type of jobs available? Do you think this is possible? Maybe these people might opine that our economy is not a fixed-size lump of labor.
Again, you very correctly point to a absolutely critical point. Might perhaps there be something else to consider here? If I'm wrong, and the world is indeed a fixed lump of labor, can you help me understand why these people are wrong?
I don’t think the world is a fixed lump of labor. Eventually there will be enough automation that people won’t have any work to do. Not everybody has the capacity to be a doctor or an engineer or a lawyer. We are just not wired that way, the brain simply works in unique ways. So how do we take away labor intensive work and still expect people to live happily while not providing them with means of living. I think there are two ways: (i) provide people with social services so they live above the standard of poverty. (ii) split automation so only so much work will be automated. This is a good compromise as we find out what automation does to our economy as years go on. For example(don’t shoot me, these are just examples), Mc Donald’s must have people working for the same amount of automatic kiosks in their restaurant. Or half of amazon warehouse must be people and half must be robots. Half of automatic Ubers must be driven by real people.
There are ways to do automation and still take care of people. I just don’t see that conversation and it’s bothersome because soon it will too late.
You might think about pausing to consider that you have described what economists call the lump of labor. This is the idea that there's a finite amount of work to go around, and it can only be distributed among various people or machines. Some might opine that there could be something to be gained by investigating writings and studies on this exact subject from the past century or more. Wikipedia can be a great starting point - https://en.wikipedia.org/wiki/Lump_of_labour_fallacy
I have had a very different experience. I see the conversation you call for going on constantly. I see it among dozens of people I know personally, of many different ages and races and education levels and careers. This is enough to lead me to think that your idea is so good and so wise that it's already been adopted en masse!
Given the opportunity, many people find problems to solve and build businesses around that solution.
By simplifying the process of starting a business to "just do it" and simplifying the tax implications of hiring and firing people, I don't think we would see a need to "create" or "preserve" jobs.
And you know what? They were right! Their jobs were permanently removed by automation. It's just that the story didn't end there, and the jobs created and enabled by automation far outstripped the jobs removed.
It might be worth considering that government intervention might not always be the solution. Choosing not to act is always an option, and is always worth considering. The first question should not be "How can we solve this problem with policy?", but instead should be "Should we solve this problem with policy?".
There is a reality that no one wants to admit - for some sizable percentage of the population, a 'job easily replaced by automation' is the best they can hope for in life - they're either not smart enough, not driven enough, or have some other issue preventing them from being a rocket scientist - beyond that, there is a limited societal need for highly educated workers - but we have lots of jobs that need just need doing, and are every bit as important, both for societal cohesion and for the fact that they need done - we need to pay those people a fair and living wage.
It comes down to a question - are we as a society willing to pay people to not work - not just starvation - but pay them a fair and reasonable wage for doing nothing - or do we as a society expect to try to get as close to a fair and living wage as possible for everyone no matter how much value they add - provided they are doing some sort of reasonable amount of work - this is the real question posited by automation.
I subscribe to some limited belief that prices rise (where possible) to meet demand. See San Francisco housing prices, or Madison, WI housing prices as companies attract and pay their employees quite a lot. So, just paying people a "living wage" isn't enough. If that's a route we go in (and I sincerely hope we don't) we need to handle every aspect of living; housing, food, medicine, etc. Just dolling out dollars/euros isn't enough.
> or do we as a society expect to try to get as close to a fair and living wage as possible for everyone no matter how much value they add
Paying regardless of performance will destroy productivity. People tend to do a "gradient descent" algorithm in work, finding some local minima of effort for their pay. I understand not all people are like this. I'm only saying I think that enough people do, that paying some fixed minimum for all no-matter-the-value will destroy economic growth.
What do we do with all the people who's jobs are automated out of existence? Do we prevent the automation from happening, or do we just pay people for doing nothing? That's the question I'm positing.
Even with the explosion of software related businesses, the actual growth of new small businesses has been grinding to a halt [0]. I'd argue that this is specifically a regulation and paperwork issue from local all the way up to Federal levels.
If we want to "create jobs" for people who are displaced, we need to allow for new jobs to be created. The government can't "create" jobs, no matter how much money it has or taxes it levies. Unless everyone works for the government. Then we're on our way to some kind of bureaucratic totalitarianism.
[0] "Firm Size" - https://www.bls.gov/bdm/entrepreneurship/entrepreneurship.ht...
Broadly I'd also agree with you, the regulatory environment makes running any sort of business needlessly complex and difficult, and tends to increases the capital requirements greatly - though I'd argue that state and local regulations are the primary burdens at this point.
This is mostly true in cases with artificially limited supply. You mention real estate, which is a good example in cities where (1) large employers are moving in, (2) zoning is constrained, and optionally (3) extra land is difficult to get, either because of geography or sprawl.
Most goods are not like this. Food, for example, does not typically have permanently higher prices after an increase in demand, because the supply curve will also change (additional supply is provided).
Same with televisions, cars, refrigerators, computers, household consumables, etc.
Therefore, I don't think it makes sense to throw out the baby with the bathwater: yes, real estate is not a normal market for a variety of reasons, but that doesn't mean that spreading dollars around doesn't work for everything else.
Real estate may need some special solutions, such as relaxing zoning laws, housing subsidies, evaluating code impact on construction costs, mass transit investment to increase travel efficiency, property tax on vacant properties, etc.
This will be exceedingly difficult in the U.S. where there is this deeply ingrained cultural belief that a living is something that must be “earned”. Basic Income and other safety nets that let people survive without working for it would be politically difficult. We are more likely to have government pay 1/2 the people to dig holes and the other 1/2 to fill them in, than have something like Basic Income here.
The next question is how do we assist those displaced by automation. There are multiple proposals including UBI and its ilk, but the most palatable bipartisan idea is to find them new jobs.
The idea of finding 'better' jobs with more agency, etc. is not immensely new - it draws from organization research on employee fulfillment and productivity.
Overall, no one is saying that any specifically displaced individual needs to take up <new job> in some sort of imagined totalitarian state - they're perfectly free to choose a new job from the market. The only question is one of skills and motivation.
The fact is, there is a LOT of room for people to work and grow. The typical factory job is significantly waning, and will continue to do so. Local service oriented jobs are far less likely to be outsourced at all. "Dirty jobs" in particular tend to pay well, and are pretty damned safe from outsourcing.
The bigger issues are more societal and likely to worsen with roughly 2/3 of those in higher education being women, and over 70% of women unwilling to date/marry those of a lower social/education status, even with matching income.
The highest satisfactions in life, generally speaking, come from earned work:income and family engagement.
It mostly just that people don't understand what automation is, and especially not many of the self-proclaimed experts. You automate things like electrical work like you "automate" Uber, by making it unskilled. You put all the logic in the terminal, if not the cables, so almost anyone can do it. In a longer time span you might just change the whole wiring to something else, like lower powered dc.
That said there is no need to go crazy. We are undergoing a second industrial revolution with information instead of energy, but overall the same rules apply. If we just make things better for people we will be alright.
Modern hypergamy (Tinder) will create more childless single women in their 40s+ than human civilization has ever seen.
This might be a solution for some people, but it's not a long term solution for everyone. As people age, their bodies deteriorate. An injury might put someone out of work temporarily, or forever. Manual labor becomes more difficult, or outright impossible, for people entering their 40s, 50s and 60s.
Depends on your perspective. As a single man with his life together in his early 30's I'm finding life good. Is this societies problem or a problem for these women?
Because you specifically are doing well, doesn't mean society is. Directly, the women in particular are not harmed, but statistically less happy. Changing perspectives on a broader level would help a lot in any case.
As for women, this is their own choosing. If you want to "have fun" with the most attractive men (looks, status, wealth) you can from 18 to 28 before you look for a partner then you shouldn't be surprised when the men who will settle down with you don't live up to the standards you're used to. There is only so many of these men and they're happy to oblige fun but commitment isn't so easy. There was a post yesterday showing how many young men are completely missing out on sexual interaction.
But consider exercise. Society automated a lot of manual labor and people still need to exercise, even though it's a blatantly wasteful use of energy. It's even more inefficient than digging holes and filling them again, because it's not even good for the soil. But it's important for people to do it.
Clearly we need to figure out how to keep those people compensated enough to survive, possibly through changing to work that our economy values sufficiently, through subsidizing them from those same gains in efficiency through automation, or via some means not yet discussed.
You speak primarily about administrative organization. I'm speaking about content and focus of material.
But people still want their caffeinated milk shakes and misnamed espresso sugar drinks, and they will pay a premium for their fix.
"On June 3, Nyerges, two sheriff's deputies and a moving truck showed up at the local BofA branch. The deputies informed the manager that he could either pay the Nyerges' legal fees— $2,500—or the movers would start taking away the bank's furniture and cash"
Priceless justice!
I would never ever do business with Bank of America because of the criminal home seizures during the great recession.
Second thought: Wages are rising, jobs are plentiful. But what happens when the roaring economy changes? Will BofA stay the course?