Why Would You Hire Someone?

Why Would You Hire Someone?
Jobs are a relationship, not a commodity.
by John Hayward 09/01/2011

Jobs are not a commodity that can be manufactured by the government, to be showered upon a deserving populace as gifts. The Obama Administration always speaks of them in such terms, discussing “job creation” as if the government need only add a bit more water and fertilizer to make the American garden bloom with lush and vital employment.

In truth, a job is a transaction. The employee sells his labor to the employer.

Why would you hire someone? The short answer is “because you need them,” but to be more precise, you would hire someone for the same reason you would engage in any other voluntary transaction: because you value the employee’s labor more highly than the money you pay for it. Conversely, the employee values his paycheck more than the time he sells you. Many variables affect this equation, but it always comes down to a mutually beneficial exchange, in which both parties come away with increased value.

The government has considerable power to distort this transaction. It can greatly increase the price of labor, for example. Over the course of many years, it has contrived to hide most of these increased costs from employees. Some of them appear as line items on paycheck stubs that most workers pay scant attention to, while others are buried even deeper in the employment transaction. This results in a working public bitterly complaining about $10 hourly wages, when it actually costs $20 or $30 per hour to employ them.

Among the most insidious hidden labor costs imposed by government are future liabilities. Employment is a long-term relationship, not a one-time purchase. This is why short-term “stimulus” programs, such as tax credits to encourage new hires, are so much less effective than statist central planners envision. A modest discount at the beginning of a relationship that will hopefully last for years does little to outweigh the liabilities Big Government has planted in the future of every private-sector job.

ObamaCare is the paramount current example. Literally no one, least of all the people who wrote and voted upon this bill, knows what it will do to employment costs in the future, but it has already increased costs enough to wipe out thousands of jobs. Many of the assumptions presented at the time of ObamaCare’s passage have proven false, such as the laughably low estimate of employers who will drop health-care benefits altogether and pay the associated fines, rather than subject themselves to the President’s nightmarish program. The actual number of employees pushed into the “public exchanges” by the collapse of private-sector health plans will be at least five to fifteen times higher than original estimates.

Every employee is also a deliciously baited lure for a swarm of regulatory piranha, from the Equal Employment Opportunity Commission to the National Labor Relations Board . For instance, a freight company was recently sued by the EEOC because it refused to let an admitted alcoholic drive eighteen-wheel trucks. Every driver they hire could suddenly become such a massive liability, forcing the company to either pay for the consequences of letting them drive… or face huge fines from intrusive government agencies if they refuse to do so.

Meanwhile, aircraft manufacturer Boeing discovered that its large union workforce in Washington State had become a deadly liability, as they were able to use their collective political influence to unleash the National Labor Relations Board on the company, and punish it for daring to open a new production line in right-to-work South Carolina. Lesson to employers: hiring union labor is dangerous. Once they reach a certain critical mass, you may suddenly find Uncle Sam sitting at the head of the board room table, dictating expensive new employment policies. This is especially worrisome when the government is also actively helping unions to recruit new members.

Our current economic malaise, including anemic GDP growth and declining consumer confidence, reduces the value of new labor to businesses, while aggressive government agencies drive up cost. Meanwhile, endless unemployment benefits dissolve the competitive impulse of the growing long-term unemployed population. Why bust your hump trying to win a job that only pays a little more than your unemployment benefits? Especially when incessant Democrat class warfare has persuaded you that everyone who might employ you is a disgusting fat cat who only wants to exploit you, so he can rake in excessive profits… while those unemployment checks come from a benevolent government that loves you, and would do even more for you, if those greedy capitalists would only give it the money it needs.

The war against the Evil Rich is a war against employers, and its success leads to further corruption of the employment transaction. It is imperative for Americans to abandon childish socialism and grow up enough to understand that employers and employees naturally want to make the job transaction. Businesses generally wish to expand and hire people. Most people want to have productive jobs. Both parties want the employment relationship to continue for a long time, because when it’s successful, it grows more valuable to both. Companies want to profit from hiring and training investments, by securing solid employees whose growing experience makes them more valuable. Employees want to earn raises and benefits through seniority.

Why would you hire someone? Perhaps the more pertinent question is, why wouldn’t you hire someone? The answer is that politicians have made a naturally simple and attractive transaction become confusing, opaque, and unappealing. If you want a job, you should push for the overhead cost imposed on your labor to be reduced, so your value will become more evident to employers who have a good reason to hire you.
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To read another article by John Hayward, click here.