Minimum Wage Underemployments

One of Marx’s key predictions about capitalism is that the surplus population would grow in a sense that there would be more unemployment and/or underemployment. Another one of his key predictions about capitalism is that poverty would grow. The prediction that the surplus population would grow fits in with the contemporary world because even though it is argued that there is increased wage inequality due to accelerating technological change, it still produced a more negative outcome, especially in Europe, where there was a substantial increase in unemployment (Mosher 255). The prediction that poverty would grow fits into the contemporary world because income distribution has stretched between nations and the rich have become even richer and the poor have become even poorer (Clark 565).

A general overview of Marx’s theory that there will become more unemployment and underemployments is that with technology constantly evolving and changing, there will be the opportunity to maximize work efficiency through technology rather than hiring more people, and this creates even more of a wage inequality between the employed and the unemployed. Having less jobs available shows that there will be a large pool of people available who need jobs and are willing to work for low wages with long hours because there are many other people willing to do so, so if one does not want to cooperate with these terms than one is more likely to remain unemployed. The process is because the pool is very competitive amongst those looking for jobs. Thus, with technology evolving, less skilled workers with minimum efficiency are no longer needed.

If the effects of accelerating technological change are indeed unprecedented and unavoidable, then at least industrialized societies are left with the unattractive choice of allowing for higher levels of inequality or maintaining a very large population of the socially excluded (Mosher 255). This literally shows that technological advancements are going to lead to a larger population of joblessness because industrialized societies only need to hire workers with high school to maximize proficiency and profit. This is because the less skilled are no longer going to be needed to be hired since machinery is taking over the work industry. A specific prediction about capitalism that Marx has is that there were unequal wages. It can be seen as true in a sense that those with a higher education level were paid more than those with a lower education background. They can go for higher paying jobs that are looking to hire more often rather than the minimum wage paying jobs that have a large pool of applicants waiting. It can be very competitive to get the lower paying jobs because more people are willing to fight for those jobs since the rate of underemployment and unemployment is so high.

Some key terms are inequality, technological change, and skill bias. Inequality can be defined as the wage gap between the working class and the non-working class, which directly contributes to poverty. By not providing enough jobs, there are more people who are becoming unemployed and laid off due to technological change and advancements since they are no longer needed. Technological change can be defined as the acceleration of new technology being integrated. This means that new machinery can be integrated to do the job of what a human can do but even faster. This then maximizes proficiency and efficiency in order to get the most profits. Skill bias can be defined as those having a high level of bias at a certain skill. This creates for unequal job opportunity, which means that one who lacks skill bias may not have the same work opportunities as one with skill bias. The worker with skill bias is most likely going to demonstrate mastery in a certain skill. If in need of fast factory workers, the skill bias of working fast and efficient will come in handy because a slow worker will not get hired since they cannot do as much work in the same amount of time.

A general overview of Marx’s theory that poverty will grow is because of the distinguished gap between the employed and the unemployed. There is an income inequality in a sense that there is a wage gap inequality. Having a large wage gap means that those with high paying jobs can continue to get paid more and more while those with lower paid jobs can continue to be paid minimally and struggle when it comes to money. Among all the income groups in the world, the wealthiest percentiles (76 to 100) in East Asia experienced the greatest upward mobility, while Eastern Europe experienced the largest negative industrial growth (-.031) (Clark 584). It is evident that there is major contrast between the two groups. Thus, on the negative end of the spectrum, poverty is going to continue to grow because it is going to be so difficult to recover once the numbers hit the negative range.

In Clark’s article, he compares the level of inequality to Cosmoros, the third most unequal country in the world, in which the top 10 percent receives 47.5 percent of all the income and the bottom half receives 9.2 percent of all the income (Clark 588). The clear gap is clearly showing that while the top and fortunate percentile of people are thriving and gaining more money, the bottom half of people are extremely struggling and are getting even poorer, which causes a large portion of poverty. Only the top 10 percent of people are earning an abundant amount of money while the bottom half is so many more people dealing with the struggles of poverty and possibly having to live out on the streets. A specific prediction about capitalism Marx has is that there is going to be a notion of making money and turning that into more money. This means that literally the rich will continue to become rich and grow in terms of commodities and material possessions, but there is the opposite end of the spectrum where the poor will continue to get poorer and may eventually become homeless. This is a direct tie in to how poverty is going to continue to grow. Some key terms are economic growth, poverty, and world income inequality. Economic growth means that the economy is continuing to grow and this effects those in the top earning percentiles.

Unfortunately, this has a negative consequence to the bottom paid earners. Poverty is described as being poor and struggling with daily needs such as having to pay bills or having a roof over your head. World income inequality means that there is a gap between the top earning people and the bottom earning people and that the wage gap is huge.

Marx’s prediction that poverty will continue to grow is right to a certain extent because there is a clear inequality gap. This is especially prevalent through income inequality in today’s China. It can be argued that China’s current high income inequality is driven by factors attributed to the political system (Xie and Zhou 6928). The difference between the two levels of earnings is so preposterous in a sense that the top earners are literally making a fortune when it comes to money and the bottom earners are so poor they are struggling day by day. When people think of China, most people think of the rich international student stereotypes that make up only a small population of China, but people forget that there are people living in the opposite end of the spectrum.

Since China has such a large population, there are many rich people; however, there are so many more poverty stricken people and this is evident in their wage gaps. One cannot argue that Marx’s prediction is completely correct though because the gap is not as evident in other countries. In countries like the USA, there are a larger number of people who qualify as middle class. Thus, Marx’s prediction can be seen as partially true, especially when we look to China’s modern society.

Marx’s prediction that the surplus population would grow in a sense that there would be more unemployment and/or underemployment is also right to a certain extent because there is an evident decline in union power. Since the union controls many jobs, if there is a decline in power for them, that means less jobs are available. Capitalists definitely want to maximize profits while hiring the least amount of workers who can do the most amount of work. This gets rid of the need to have less skilled workers because the power of technological forces is against them (Mosher 255). If a machine can do more work, then the capitalist mindset is that they will not need the human labor power.

America is becoming more of a capitalist nation but Marx’s prediction cannot be entirely true because there are still many minimum wage jobs that are being offered. Fast food jobs, dishwashing jobs, and many other industries are still looking to hire. If Marx’s theory were to be entirely true, then high school and college students would have tougher times finding jobs because companies may not have viewed them as skilled enough or educated enough without certain degrees. So, Marx’s predictions are definitely at least partially true in a sense that machinery is taking over human labor jobs, but wrong in a sense that there are still many other lower paying jobs available.

Ultimately, Marx was arguing that the surplus population would grow in a sense that there would be more unemployment and/or underemployment, and that poverty would continue to grow. Both have valid points when it comes to capitalism because there is more unemployment when it comes to technological advances and machines getting rid of the need to hire human labor power. Also, poverty is a very pressing issue especially in countries like China where the wage gap between the rich and the poor is pretty significant. Especially with the contemporary world conforming to more of a capitalist nation, these ideas can all be seen as at least partially true. It is evident that the rich are continuing to grow in their riches and that the poor are continuing to get even poorer. Also, there are a pool of underemployed people ready to fight for those competitive jobs. Marx did have very negative views on capitalism, but his ideas were not all entirely false since there was some truth and validity to his arguments just by looking at the contemporary world.

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