Today I learned that some coal mine workers went on strike demanding higher pay. They say that a few other coal mines are paying better salaries than their mine and they have had it enough, so they started a strike. The miner’s public relations team issued a statement basically saying that they have 14,000 workers and only 400 of them are on strike, but since those 400 worker are blocking others from accessing their workplaces they do not work as well.
I think organized labour is a really bad idea. It doesn’t matter what type of labour it is. You can have some sympathy to coal miners, after all, the job is not very pleasant and quite dangerous. I have such sympathy as well, but… Strike is a wrong way achieving fairness in anything, including higher wages.
There are few problems with strikes. The main one is that it simply doesn’t lead to a good solution. Let’s examine why workers are ‘underpaid’:
I don’t believe any employer is underpaying workers just because this employer is greedy. Why? Because everyone is greedy to some extent. Greed is not the only emotion in this situation. Greed is balanced out by fear. A fear that ‘underpaid’ employees will quit and join some other employer leaving their current employer holding the bag. Remember, the employer is likely to be in debt. All big enterprises are in debt. They always need financing. What happens if people just walk away and the employer is no longer able to hire anyone for the poor salary it offers? Well, the production will halt, cash inflow with dry out and banks will be on the phone demanding their money back exactly at the time when you don’t have any. Finally the firm goes bust, assets are auctioned off and acquired by other entrepreneurs, and the money is paid to bankers leaving current owner with nothing. This is a natural deterrent to greed. A fear to go bust.
2. Too many redundant workers
This is quite unnatural for businessmen to keep big amount of non-utilized labour resources. Remember, that they are greedy? So, why they would pay to people that don’t do anything? It is quite likely that employer will decide to pay more to employees by laying off some significant number of employees to save money. Save money on non essential things like… safety. Or something else. So the work conditions will not improve very much or the rest of employees will have to work more.
3. Workers are poorly equipped with tools
Well, this might be a consequence of a large number of redundant workers, then see above. It also might be because of lack of investments on a part of the owner. It can’t be greed however, because it is unnatural for owner not to invest in a profitable enterprise because of greed. Usually people invest precisely because they want a better return (they are greedy, they want to make more money). So underinvestment could only happen when the enterprise is doing so poorly, so it doesn’t have any resources to invest. How the strike can change that? It can’t.
4. Workers don’t have any skills to leave the company in persue of a better pay
Well, that’s where greed kicks in. Ha-ha, I’m a businessman! I know those suckers will not leave because they are not employable. So screw them! I don’t think strike will help here long term. If the business is based on dumb employees who don’t know a thing, this business will either fail or will eventually significantly cut back on labour force (after significant capital investment). Strike can only speed these outcomes up, and if you’re an employee with no marketable skills… This is not a good news for you.
So, the strike is not a solution. What is a solution? The solution is to quit. Not to strike, but to quit. If you can find a better pay — go and find one. If you can’t — educate yourself and try again. People quitting a company send the right market signal to the business owner. He or she will have to react sooner or later to do something about it. And if employer can’t or will not do anything, why do you want to continue working there? I think you really don’t. No violence, no conflict. You quit and you improve the economy and your personal financial situation by engaging yourself in a more productive activity.