Implications of the Employment Market

Question: Do you agree with the characterization of a wealthy state as one with full employment, and a wealthy citizen as one who is employed?

While a state that achieves full employment in a capitalist setting should be commended, it does not necessarily follow that the state is “wealthy”. John Ruggie’s description is based on his prior definition of individual wealth as a person who is employed. It follows, by his logic, that if every citizen is employed, and thus “wealthy”, then the state as a whole is “wealthy”. First off, I would have to agree with the viewpoint stated by several of my classmates, including Seamus and Tori, that the simple state of being employed does not constitute a state of wealth, this being primarily because many jobs do not reward the employed with subsistence-level returns. In a perfect capitalist system, those with a job with less-than-adequate pay would be able to find an appropriate job, until labor market equilibrium is reached. However, when there is a shortage of available jobs, it forces workers to go below their needs, to accommodate for the lesser of two evils. In this instance, subsistence is not reached, so by any other definition of the word, this does not constitute a “wealthy” person.

Concurrently, I find the use of the term “wealthy” to attempt to define certain economic trends and standards rather irrelevant. “Wealthy” is a relative term; it varies between regions, times, and personal values, and has not solid definition in the first place. When debating and measuring economic employment standards, there are two levels that matter: whether or not the employed worker reaches subsistence, and whether or not the employed worker has disposable income. Either of these levels are more realistic definitions of wealth than the one proposed by Ruggie, yet we wouldn’t nominally use the term to describe everyone in those two categories. It is most often used to describe a person with unusually high material and/or monetary assets, though the level of which is not specified. The term “wealthy”, therefore, has no practical meaning and cannot be used in official policy, so its use in a debate setting is entirely colloquial.

The possibility of full employment is a lofty one, but it would almost certainly be beneficial to the nation as a whole if it were obtained freely. However, if the problem of excess workers for a limited number of jobs were solved, then there is equal likelihood that there would be excess jobs for a limited number of workers. I’ll be honest, I’m uncertain of what the implications of that would be; I imagine it would entail a heightening of work-related immigration and higher pay for native workers, but a possible scarcity of services, most notably in blue-collar government jobs (i.e. the fire department). For all I know, this is a relatively common occurrence, and if it is, I invite someone to give me an example or two. Full employment, however, is a very precise target to hit in the free market, and while it may not define wealth, it would certainly prove the vigor of the economy in question.