Unemployment VS Increased Prices due to shortage

[Skypainter]

@konputa

I think it would be foolish to assume there won’t be long term changes to our economies at a local and international level. I believe there is a good chance this event will hasten the demise of globalism which seems to want to encourage dependence and to depress labor. Labor and “localness” may well gain more bargaining power from here on out.

i pretty much agree. And I want to be optimistic that eventually the consequences will be far more positive than negative.

But in the context of gear, in the short term, the cost of components from China will go up, increasing production costs for pretty much all manufacturers; I reckon the big players, Akai, Roland, Korg, and especially Behringer whose (AFAIK) business models depend most heavily on Chinese labour and long supply chains will be hardest hit.

The Japanese gov is offering Japanese corps large grants and incentives to relocate manufacturing to Japan. This may well lead to more expensive and fewer new devices, but better quality, more durable products from the Roland and Korg.

In the case of Elektron, or Modal in the UK, modular manufacturers in Europe and the US, the added costs of producing locally (higher wages and taxes) are already priced into their products.

As far as music retailers small and large, I get the impression that there are already far fewer in Europe than the US; online is where practically all the sales are at. i…e How many people have walked into Thomann, Juno, Gear4Music and tried a synth before buying? Anybody?

[Cepheid]

This may he a nail in the coffin for some too that have already been struggling through the years. Guitar Center comes to mind.

[Jukka]

@Cepheid

a nail in the coffin for some too that have already been struggling through the years.

There are some music equipment manufacturers who have also been struggling of recent – Gibson certainly, but also ROLI and Modal have been financially extended. If i think a while i may recall others.

As Warren Buffet said, “It’s only when the tide goes out that you learn who has been swimming naked.”

[Cepheid]

It seems the house of cards is just “one blow from caving in” to quote a Katy Perry song. For individuals and businesses alike. Just shows how hard it is to stay afloat these days.

[konputa]

@Lieder

I’m one of the few who has a good job that is deemed necessary.

And I’m guessing nobody has offered you hazard pay, right?

[konputa]

@Jukka

There are some music equipment manufacturers who have also been struggling of recent – Gibson certainly, but also ROLI and Modal have been financially extended. If i think a while i may recall others.

I would think that a Guitar Center liquidation would harm a lot of large manufacturers greatly. Private equity ran them into the ground, not the market. That said, GC is known to act like Walmart so they share responsibility for running so many locals out of business.

[Jukka]

@konputa

Private equity ran them into the ground, not the market.

Over-leveraging – but they may have survived without the current depression. (I’m not mincing words.)

ADDED: They may still survive, they’ve not been buried yet. It’s a long shot though.

[Lieder]

Nope, hazard healthcare would’ve been even better

[Patrick]

Observing the UK and US, the whole crisis is a political disaster. How long will politics fail the majority of society?

[Jukka]

Agreed. We’ll see how it plays out politically in Russia. <= Off-topic.

[Rusty]

@Jukka

There are some music equipment manufacturers who have also been struggling of recent – Gibson certainly, but also ROLI and Modal have been financially extended. If i think a while i may recall others.

Roli just recently sold Juce to Pace.

[Jukka]

@Rusty

Roli just recently sold Juce to Pace.

… but kept Jules Storer who is working on SOUL !

[sabana]

Its a bad time to be a seller. But a good time to be a buyer for sure. Just give people your best offer. But the people who look for more money i feel are doomed to have no sales.

[mynewcolour]

Talking generally. The problem is you have to compete in a sector to a price that sector sets. Sooner or later it becomes unworkable to pay considerably more than the competition.

Perhaps if pay and conditions in that job aren’t acceptable to anyone but (for example) illegal or desperate migrant workers then that sector’s conditions are just under regulated? Or the sector needs a player that has to act in the public interest?

If you have one player in each sector that is public-owned they can lead the way on aspects such as pay & conditions (good for the worker) or price (good for the consumer). This is good for the majority and helps consumer confidence, it just displeases myopic shareholders in the industry (and political campaign funding disappears).

I appreciate this might sound like ‘communism’ or something to some but a pragmatist ignores these to their own detriment.

[sndrsklr]

@mynewcolour

Perhaps if pay and conditions in that job aren’t acceptable to anyone but (for example) illegal or desperate migrant workers then that sector’s conditions are just under regulated? Or the sector needs a player that has to act in the public interest?

This just popped up (again) in the „meat industry“ (talking big slaughterhouses and their attached big players) here in Germany. Even though this has been going on for decades it just shed new light on it because the underpaid workers from eastern Europe are living in small shared apartments with other workers and Covid-19 is spreading pretty fast under these circumstances. And still there are some politicians trying to blame the workers (partially) for it instead of the shady practices with sub/sub/sub/sub companies to avoid any decent pay and responsibility.
Same with seasonal workers on the strawberry and asparagus fields but for the majority it’s still business as usaul.

[mynewcolour]

It takes vigilance and good governance to make it work.

The incentive for shady practices (exploiting loopholes, politicians turning a blind-eye to casual and black market labour) actually tracks employment standards.

Standards go up, the spoils of corruption goes up.

[mynewcolour]

There have been interesting conversations in the UK about farm labour. Much of this usually comes in seasonally from Eastern Europe.

Mostly we have realised that working hard for a low/medium wage here is extremely unattractive if it’s nowhere near enough to establish a home here. English people would prefer a less insecure, less consuming, less gruelling and less physical job if they are paid a wage that means they have to stay renting anyway.

[konputa]

I was just reading that there are at least $1 billion in late mortgage payments due just on New York city hotels alone.

Add to that all commercial and residential property nationwide and what we are facing is probably an as of yet unacknowledged greater depression. The stock market is entirely disconnected from economic reality, IMHO.

[spacetravelmadeeasy]

Already seeing listings on eBay with the reason for selling being due to unemployment because of Covid.

If the market starts to get flooded then it’ll bring the 2nd hand prices down of items.

[nilsec]

I’m with you on this. The notion of the market isn’t going anywhere. Markets have existed before notions of capitalism or socialism.

When I hear sob stories though of businesses that can’t woo back their labor because their furloughed employees are making more money on unemployment. This should be a stark reminder to business owners that there can not be be Capital without labor, and those businesses should pay their workers more.

And when those businesses say they can’t compete with labour costs in China or Vietnam, then as a society who cares about workers’ rights we should ask our selves, why do we trade with those other societies that actively undermine our workers here?

At the end of the day, It’s called paying a living wage. And societies that respect their workers should not trade with those societies that don’t.

Businesses that can’t woo labor should fail.