Saturday, September 4, 2010

Justified Injustice

Industrialists set up industries and employ labourers. In many cases with meagre salaries and with poor working conditions, particularly in some economies. This is especially true for the unorganised sector, where often, even the basic subsistence requirements of the workers are not met. Even for labourers in the organised sector, the incomes levels keep them just above the bare subsistence level.

This is not due to a lack of market value for the goods produced, or due to a lack of profits, because the industrialists themselves earn a lump sum. And they earn this without doing half as much work as their employees.
Some known arguments raised against this statements are:

Argument:
The industrialists have invested a lot of money, thus they deserve a higher return.
Counter-argument: The fact that they have enough money to invest is just a matter of accident of birth, and not because of any personal merit. Even if they were not rich by birth, and worked towards it, their incomes are still disproportionate to their effort.

Argument: The industrialists are taking a huge risk of losing the business and therefore are entitled for higher returns. Whereas an employee takes far lower risk and stress because of the predictability of their income.
Counter-argument: Let us look deeper into this risk vs. return argument:
If the employer (industrialist) loses profits, he/she still has the basic necessities of life, and the drop in lifestyle is not much. However, in such a situation, the employee loses even the basic necessities. Thus the employee is taking a much greater 'risk' for hardly any returns.

Argument: It can be argued that in some cases the profits go back into the business for expansion. This benefits the employees.
Counter-argument: The expansion of the business will result in infrastructural development and more employees being hired. The increase in the pay, if at all it is there, will not be in proportion to the amount of work already done by the employee, and cannot equal the money he/she has been deprived of.

Conclusion:
Thus we can see that the core objective of any industry is to increase the share holder's value. The results obtained due to the efforts of the employees do not go to them.

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