The brighter side of high unemployment

Look at it from the employer's side: There's a vast pool of highly qualified workers begging to be exploited. Yay!

Published September 29, 2009 9:34PM (EDT)

I'm not exactly sure why BusinessWeek contributor Gene Marks decided to e-mail me a link to his latest column, in which the self-described "entrepreneur" gloats about how high unemployment is good for his business. I guess any publicity is good publicity, or he's just spamming all the vaguely biz-related bloggers he can find. But he didn't pick a good day. Having already been irritated enough by David Brooks, I can't say I was exactly in the mood for an explanation of why high unemployment is great for small businesses because now there are so many "good, bright, educated people" who are "willing -- no, let's admit -- grateful to work for less money and longer hours."

Even better, the bad economy provides cover for getting rid of that "dead weight" that you were feeling too guilty to throw overboard.

Every company has a few people who aren't doing as good a job as others. Some companies, such as NBC, give these people a daily prime time comedy show. But the rest of us make some changes and shed unproductive dead weight. Then we blame the bad economy and point to others who are also laying off people and say we're only doing what we must to survive. It's a great excuse. And we couldn't have used it a few years ago. Should I feel guilty about that?

And the capper:

Because let's face it: The upside to the high unemployment rate is that it has helped us control our payroll costs. No one's asking for raises. No one's demanding more benefits. ...It's now easier and more politically correct to hire part-timers, subcontractors, and other outsourced help to fill the gaps. That's because when people are out of work, they'll do whatever they've got to do to bring in cash.

I understand that Gene Marks is not targeting his commentary at me. He is a small business owner (he sells customer relationship management tools), who is attempting to speak to other small business owners, all of whom, presumably, are also delighted that the potential hiring pool is so chock full of talent desperate to be exploited right now.

But one wonders who exactly is supposed to purchase all those products and services from the small businesses of the world, if unemployment creeps up to the 10 percent mark or higher? High unemployment means low consumer demand. Which usually means small businesses end up going out of business, or at the very least, laying off more employees, who push the unemployment rate even higher. And so on. Low employment might mean it would be harder to find qualified employees, but it also means more customers with money burning a hole in their pockets. Which scenario, do you think, is better for society in general?

I have no problem with contrarian arguments. But a look back at the oeuvre of Gene Marks suggests that in his efforts to be routinely contrarian, he ends up coming off as, well, how can I be polite? What's the opposite of insightful?

By Andrew Leonard

Andrew Leonard is a staff writer at Salon. On Twitter, @koxinga21.

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Related Topics ------------------------------------------

How The World Works Unemployment U.s. Economy