Capitalism is good at concentrating wealth, folks who start a business expect to be rewarded for their risk and effort. Small scale business needs skilled employees and rewards them with a living wage. Large scale business automates and de skills the work to make a higher margin, which works as long as the economy is humming and those long production runs can all be sold at full price. As the economy slumps, post 2008 style, manufacturing looks to lower unit costs, moves to lower wage countries, automates even more, looks for tax savings. This keeps the cost of production down, and buys a reprieve from the slump. It also drives down the de skilled wage, in todayâs dollars. I googled inflation adjusted minimum wages in Canada and got the following: in 2015 dollars, the most recent they had, Minimum wage in 1970 was $7.20. In 2015, it was $10.50 (on PEI). Something that cost $100 in 1970, goods or services, costed $532 in 2015. So, wages went up 1.4 times, but costs went up 5.3 times. At a certain point, Mom went out to work, just till the economy improvedâŚit didnât, not for the unskilled workers. Now you have to add child care to the bills, 'cause Mom is working too, and at a certain point, the family canât afford to pay for more child care, so limits the size of their family. Here, that has meant school closures and an aging population. Some folks at the low end of wages lose hope, and stop trying. It is lack of opportunity and lack of hope that defeats them. Thankfully, we have land, and farmed while younger. Hubby had a skilled trade, and I had pigs, and a baby, grin.
As long as you have hope, you look for opportunityâŚlack of hope stagnates the economy.