Amongst credible economists and political leaders (so, not including Malcolm Turnbull and Scott Morrison), it is universally accepted that Australia, like most other developed economies, has a wealth and income inequality problem. There are books and essays being written and read every minute about why this problem exists, but let me simplify in the words of a writer, not an economist: the people who own the capital (the business owners, shareholders and executives) are keeping profit from their investments for themselves, rather than dividing it amongst the people whose labour contributed to the return. This behaviour explains why company profits were up 40% to March this year, yet wages were only up 0.9%.
Before I go on, just a quick word about the behaviour that led to this outcome. You will often hear company executives and business journalists using passive language when talking about company profits and the way they are distributed amongst shareholders, executives and workers. Investments apparently ‘flow’, like water from a tap, as if nature intended shareholders to get a better deal than the workers who created the wealth. Anat Shenker-Osario makes the excellent point that this language erases responsibility for the actual decisions that led to these outcomes. Business owners and executives don’t stand in the hallway of their office and watch money flow to various stakeholders in imbalanced proportion, coincidentally, much of it into their bank accounts. They choose to make this happen.
If we, workers, are concerned about this situation of growing wealth inequality, we need to do something about the culture of what is accepted behaviour amongst business owners. We need to reassess our own language and culture around the relationship between what we do for a living, and with those in control of how much we get paid.
Another caveat here. The business owners should also be concerned with flat-lining wages and the resulting growth in inequality. Who is going to buy their products if no one has any money left after necessities? As this article points out, 60% of Australia’s economic growth is consumer based. Those consumers are, for the most part, the very same people who work for a living – who sell their labour and who haven’t had a meaningful pay rise in four years. Business owners and leaders don’t seem to fully understand this fact; no doubt they hope everyone else gives their workers a pay rise, but they’re safe not to do the same. In the long term, this selfishness is clearly to everyone’s detriment.
So what is a worker? It’s time we talked about this question, because I fear there are far too many of us who don’t fully comprehend what it means to sell our labour. I know a union secretary who has been told by members of his union that they don’t want a pay rise as they’ll be priced out of the market. These are workers who are qualified and experienced trades people. Yet, they have drunk the neoliberal-kool-aid that their bosses have been serving up forever which makes them fear that more pay will make them a bigger liability for their boss and they might be got rid of.
Let’s just get something straight right now. The boss doesn’t hire someone to do work for them out of the goodness of their charitable heart, and they don’t keep them employed because they’re nice people. I’m not saying aren’t good person, and are purposely trying to screw over their workers. But what I am saying is that people who are paid to do a job need to understand that without them doing that job, their boss couldn’t run their business, couldn’t produce profit, and would have no return to show for their investment of time and money. The boss needs the worker just as much as the worker needs the boss. The resulting compact between a worker and a business owner goes something like this: the business owner invests in setting up a business, contributing capital such as an innovative idea, market knowledge, physical resources and money. If they can’t create profit with their own two hands, they need people to do work for them to co-create profit from this investment. It really is as simple as that in pretty much every boss/worker relationship. Yet, somehow workers have become so brow-beaten by economic and job-insecurity, and so convinced by the neoliberal trickle-down promise, that they have been made to feel like they should feel lucky to provide their labour to a business owner, and that they do anything to displease the giver of luck, such as expecting to be fairly compensated for the labour they provide that contributes to the profits of the business owner, their luck might be taken away.
Workers need to stop believing their boss when they say tell them they can’t afford a pay rise. Workers also need to start demanding more from their boss, such as requiring that they be told how much profit a company has made. If the boss wants to deny a pay rise year in and year out, they need to look the worker in the eye and tell them how much the business owner, executives and shareholders have received for their input into the business (investment), so that workers can compare this to how much they have got for their input; their labour. Workers need to understand what we are and what our role is in profit creation. You saw it coming and here it is: to do any of this effectively, takes collective effort. Workers need to unite together in their demands to have their labour input respectfully remunerated. And the best way to do this is to join together IN A UNION. IN SOLIDARITY.