News Story

Moss Message: What(s) a Job!

(The following is an edited version of the "Moss Message," commentary from state Rep. Chuck Moss, R-Birmingham. The "Moss Message" a semi-regular email column that he writes and sends out. Moss is the minority vice-chair on the Michigan House Appropriations committee - the highest ranking Republican member of the committee that approves the state budget each year. These are his observations regarding employment.)

By Chuck Moss

Everybody says we need jobs. I agree. It's not just about the poverty of joblessness. A job is an anchor in a person's life, and today in Michigan, we have far too few of them. With our unemployment still in the teens, everyone agrees we need "jobs." But does anybody know what a job really is?

What does the word "job" mean? There are lots of common definitions, but the key one is perhaps the oldest. A job is a unit of measurement. It's like an inch or a mile or a gallon, only it measures work. That's why, years ago, people used to speak of "a job of work." They were talking about a defined piece of activity.

The job was how you broke down a large amount of work to be done. Say you have to clean out the garage. That's a big bunch of work. You break it down into smaller tasks. First you empty the garage. Second you sweep and hose it out. Third you repair the broken stuff. Fourth, you put everything back in. Those smaller tasks are called "jobs."

Now what if you have a really big garage, or own a trucking company? You probably wouldn't want to do all those jobs yourself. So you'd go hire someone to do one or more of them for you. Now that person — call him Tom — has a defined bit of work to do, and you're paying him a defined bit of money to do it. He says he has a "job." Congratulations! Tom is now employed, and you're now a job provider!

Notice how you need three things to create a job. One, you need to have work to be done. Two, you need to be making enough money to afford to hire someone else to do it — otherwise you'll do that job yourself. Third, in a business, you have to be able to do something else with your time that makes more money than that job costs, for it to be worthwhile to hire Tom to do it.

Let's say you do such great work cleaning your garage that your neighbor wants you to clean his. Now you have more work to do, so you hire Dick and Harry. That's two more jobs created! Congratulations again! But remember why you hired Tom, Dick and Harry: You had work for them to do, and you had to be making enough money for it to make sense to pay them to do those jobs.

Now let's take another look. What if Tom, Dick and Harry decided they needed to be paid more money? Well, you'd look at your balance sheet and see if the business was making enough profit to afford raises, and also if their work was worth it. Were they producing more than they were before? Had they become so good at their jobs that they couldn't be replaced easily?

Now what if the government came along and said, "We want you to give them certain benefits"? Well, the government has just raised the cost, or overhead, on those employees. It just made them more expensive. Same thing if the government adds new rules and regulations that make employing someone more costly. Same thing if you raise wages by government fiat. Same thing if the employees organize a union that raises pay regardless of productivity or the employer's situation.

When it gets more expensive to hire someone for a job, the first thing that happens is that the employer won't hire someone new. Tom, Dick, and Harry got hired, "but Bob, no, better not. We can get by with what we have." No new job gets created. It's too expensive. There's no way to measure the jobs that don't get created, but the loss is real. Tom, Dick and Harry get de facto — and maybe actual — raises, at the expense of Bob and Bill and other folks who get left out. This is the situation in Europe, where workers have fat compensation and vacation contracts, but unemployment is high.

If the government or union adds too many more costs, sooner or later it makes no sense to keep people on. Attrition thins out the workforce. Tom moves on and isn't replaced. We find a computer can do the job of Dick. And if the economy goes bad — well, remember what I said about the job formula? You need to be making enough money and have enough work to hire someone. Business is bad, so Harry gets laid off. Now you've destroyed three jobs. Congratulations again.

So if you want to have jobs — and we need them — understand where they come from. Someone has to have extra work. Someone has to be making money. Hiring a worker can't cost more than it's worth to the employer. Remember those three things and you'll have all the jobs you want. Forget them, and you'll have Michigan.