No need for government: Small-Business Owners can Fix the Economy

**Misaki** · 03-20-2012

This applies to all sizes of businesses but small businesses traditionally have a much higher rate of job loss and gain, despite having a relatively small share of the total number of employees in the US. Half of employees in the US are at firms larger than 500 workers, the same corporations that have been making record profits since the start of the recovery with very little of that money going to salary increases or new jobs.

What business owners can do to help the economy is simple, and in line with management practices to improve product quality and production efficiency since the "scientific management" of Taylor and Ford and the human relations movement that followed, but instead of just money as the incentive there is the bonus of being able to choose to spend less time working.

While this might sound completely counterintuitive — we work to make money, after all — in a 2010 poll 76% of percent of employees said they were willing to take a pay cut, and a convincingly made animated presentation talks about how poor of a motivator money is once you have enough of it.

This is true for employees at both ends of the income curve, but due to supply and demand only low-paid workers can easily be found to fill a job position. Business owners can take advantage of this by treating these positions as flexitime with an additional small hourly component for time spent working beyond the minimum amount. Anyone who chose to work beyond what the business required would be paid at less than their average rate.

Just to be clear, this would mean that a full-time worker would make less than they do now. Time up to the weekly minimum would be paid at the normal rate, but the rate would decrease after that point. Flexitime workers use the normal overtime rules in the US, but by having a flexitime minimum that's smaller than 40 hours per week with a lower compensation rate past that point a business could hire enough workers that no one would ever need to work more than 40 hours per week.

If one business did this, they could expect...
- Higher efficiency at work
- Lower wage costs
- More flexibility in schedules due to larger number of employees
- Lower income for employees, but more free time

If many businesses did this, they could expect...
- Lower unemployment
- Fewer available workers and higher wage costs for the industry, which could be passed directly to customers such as the super rich

The value of time should be clearly acknowledged. Even a couple with a modest income of $450,000 per year complained about having to spend $60,000 of that on private school and child care, which would have been unnecessary if they had the time to take care of their children themselves.

Further reading:

**PeterUK75** · 03-20-2012

Where do you live that $450,000 is considered modest?
I just had a look and it seems that $90,000 is about average in the US for a family with two working parents.
I do agree that US workers seem to see long hours as some kind of badge of honour and look down on European style working time regulations. I think many jobs could be created if you had stricter limits on work time and more access to vacation (the US worker has shockingly few days off per year compared to Europeans) and I think you will also find productivity is maintained as people are more motivated while they are at work.

**Wlessard** · 03-20-2012

So what is being said if I work for less I work harder?

I never signed up for a job in the past with the thoughts of getting a pay cut. I would take jobs at a lower pay than I wanted in the anticipation of showing how hard I could work and getting a better raise.

I think something is skewed about saying 76% would basically work harder for less money than they are making now.

**PeterUK75** · 03-20-2012

I think the idea of a pay cut is a nonstarter but as I said capping working time to reasonable levels and giving people more time off is not going to cripple the economy and will lead to more content staff who are able to see family and friends without worrying about taking valuable vacation days. I think a lot of Americans confuse having a good work ethic with working as much as possible. Most French people are just as hard working as Americans and they have very strict work hour directives and productivity in France is still high but they value the time away from work as a chance to recharge so they are fresh when they do work.

It's mostly a cultural difference between the US and Europe and I prefer the European way which is perhaps not surprising.

**Evil_inKarlate** · 03-20-2012

Originally Posted by Wlessard

So what is being said if I work for less I work harder? ... I think something is skewed about saying 76% would basically work harder for less money than they are making now.

Work harder and work longer are not the same thing. Once one makes enough money (with the individual defining 'enough'), time off become more valuable, but most jobs, and many labor regulations, fail to take that into account. I put in about 10% OT for the entirety of last year (not a lot for a workaholic, but grinding for most people, especially since it was unpaid) because it was needed. Right now, work is slow and I'd gladly work 30 hrs for commensurate pay, which would be a good deal for the company, since there's really only 30 hrs of work to be done in the 40-hr week they're paying me for.

Originally Posted by PeterUK75

I think a lot of Americans confuse having a good work ethic with working as much as possible.

Exactly.

**thanatos144** · 03-20-2012

Nothing is free........Once you get that through your head you will be better off. You want something? Work for it.

**USCitizen** · 03-20-2012

Work hard? I work smart. Even at my current job I am at least 3 months ahead of schedule.

**PeterUK75** · 03-20-2012

Originally Posted by thanatos144

Nothing is free........Once you get that through your head you will be better off. You want something? Work for it.

I never said I wanted anything for free but asking for better work/life balance considerations from employers is hardly asking for the moon on a stick. As I said if you look at France companies are still able to function with much greater holiday and other benefits than in the US but you seem to have a problem with workers wanting better conditions.

**tsquare** · 03-20-2012

Originally Posted by USCitizen

Work hard? I work smart. Even at my current job I am at least 3 months ahead of schedule.

Since when are you working? "Nobody" in the Tri-state area can find a job above min. wage.

And I have that on the good authority of an expert...

**ArmyCowboy** · 03-20-2012

Originally Posted by USCitizen

Work hard? I work smart. Even at my current job I am at least 3 months ahead of schedule.

^ This

I never understood the folks who "brag" about how hard they work.

I'm the guy bragging about how smart I've worked and how I've accomplished more in fewer hours than those out there busting their asses.

**USCitizen** · 03-20-2012

Originally Posted by tsquare

Since when are you working? "Nobody" in the Tri-state area can find a job above min. wage.

And I have that on the good authority of an expert...

I believe I've been pretty honest about it.
I was very nice to someone for 16 years and he returned the favor when I was in need.

**Misaki** · 03-20-2012

Originally Posted by PeterUK75

I think the idea of a pay cut is a nonstarter

If it's phrased in the sense of "giving more people jobs" I think it may very well work.

But this depends on there being other people who are able to do the job, which is why it doesn't work for more educated positions. It's basically 'work share' but without a government subsidy.

I'm targeting business owners (and suggesting a wage cut) because employees and the unemployed have not shown any significant interest in this method of reducing unemployment. The unemployed even vote less than normal, there is no motivation to ask for a higher wage rate at all.

Originally Posted by PeterUK75

I think a lot of Americans confuse having a good work ethic with working as much as possible.

An explanation for why people try so hard to make money comes from an unlikely source:
The Big Lies People Tell In Online Dating « OkTrends

People exaggerate a lot about their income, precisely because it's so effective in a social environment. And those kinds of assumptions aren't just found on dating sites of course.

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