"Price’s Law says that 50% of work at a company is done by a small number of people. Specifically, it says that 50% of work is done by the square root of the number of employees.
"There’s no need to break out the middle school math book to understand this. If a company has ten employees, three of them will do 50% of the work and the other seven will do the rest.
"If there are 100 employees, only 10 will account for 50% of the work. And if there are 10,000, only 100 will do half. That leaves 9,900 people doing the rest..."
*****
Thanks so much to Bob for the link to this excellent article.
Prices Law is something I lived by as a grocer. And when the $15 an hour minimum wage was on the table, I drafted a plan to cut 80% of the staff, which gave us some fat to pad the schedule if we were willing to increase margin and reduce volume.
This brings us to the more ancient rule of thumb in Plantation America—and don't you worry ladies, we will get to "the rule of thumb" as a concept soon enough. Common wisdom ran that a free man did as much work as four slaves. Yet, business owners would rent slaves at 20% more than they would pay for free wage laborers. This was specifically the case in workhouses in South Carolina in the 1850s, as documented by Hinton Rowan Helper. This author also documented in exacting detail that the South could not feed its own horses, was merely a resource extraction zone plagues by dysfunctional economics, economic contraction and civil unrest.
Does that sound familiar?
The fact that the leading men of South Carolina were willing to rent a slave from another leading man, who would do 25% of the work that would be done by a free hired man, who would work for 20% less, essentially achieving Prices Law if he were hired, is a clear demonstration that class solidarity was the number one priority among South Carolina gentry, outstripping economic incentives and race solidarity.
Although this was supposedly an age of "white supremacy," there was no sight of racial solidarity in the labor equation. For, by Helper's time, virtually all the rented slaves were African American, while virtually all the free laborers [about 90%] were European American. It appears that African American slaves in South Carolina work houses were primarily used to deny employment to free, poor European Americans. This was evidenced in Helper's exhaustive study by the falling European American population in the Southland as poor European Americans migrated in large numbers to "free spoil" territories and states to the west.
As actor Glen Ford indicated, when playing Abraham Lincoln in Young Mister Lincoln in that 1939 movie, "a white man," could not make a living even if he owned land once the slaveholders brought in their slaves to drive him into poverty. Additionally, Prices Law gives us a clue as to the necessary economy of scale implicit in unfree labor markets and why most slaves were owned by a tiny majority of slave holders. This is within the context that Slave holders themselves numbered less than 15% of the free population, indicating that it required great gangs of job-slacking slaves to drive a handful of free men from their land by casting them into poverty and denying work opportunities for their sons. The ultimate goal in this system seems to have been acquisition of the freeholder's land, as grossly evidence by the mere 10 years it took to turn Georgia into a slave state once Oglethorpe was driven out by Carolina slave holders hungry for land. Once that was achieved, slavery would no longer be necessary and would have been abolished internally by 1900 at the latest—unless some outside force found an excuse for grabbing the land before it became free soil. Freedom is the natural state of man on the land, a state to which it always reverts when slave systems ebb, just like tilled fields and grassy lawns will become forests in a few years if left unattended.
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"In the United States people abolish slavery for the sake not of the Negroes but of the white men...When a century had passed since the foundation of the colonies, an extraordinary fact began to strike the attention of everybody. The population of those provinces that had practically no slaves increased in numbers, wealth and well-being more rapidly than those that had slaves...On the left bank of the Ohio (Kentucky) work is connected with the idea of slavery, but on the right (Ohio) with well- being and progress; on the one side it is degrading, but on the other side it is honorable; on the left bank no white laborers are to be found, for they would be afraid of being like the slaves; for work people must rely on Negroes; but one will never see a man of leisure on the right bank; the white man's intelligent activity is used for work of every sort. Hence those whose task it is in Kentucky to exploit the natural wealth of the soil are neither eager nor instructed, for anyone who might possess those qualities either does nothing or crosses over into Ohio so that he can profit by his industry and do so without shame." - Alexis De Tocqueville, "Democracy in America", VOL. I, Part II, Chapter Ten, "The Three Races that inhabit the United States”, 1838.
“Freedom in capitalist society always remains about the same as it was in ancient Greek republics: Freedom for slave owners.”
-Vladimir Ilyich Lenin (1870 - 1924), First Leader of the Soviet Union
Interesting. The Georgia example tends to support what the Communists always alleged, that matters like race, ethnicity and religion ‘mystify’ the people and distract them from recognizing who their real enemy is: their ‘class’ enemy the ‘bourgeoisie’, that is to say the rich. Marxist doctrine teaches that workers have more in common with workers in other countries than they do with the rich in their own country. Likewise the rich have more common interests with the rich in other countries than they do with the working class in their country, and therefore will often act in concert with foreign rich to the detriment of the workers both at home and abroad. Here in the “free soil states” of the American Midwest people are famous for being ‘nice’. But at the same time they are tight with their money and very mistrustful in money matters. They are always on the lookout for people who would take advantage of them and defraud them of their money. They are especially mistrustful of rich people. And not without cause. Consequently states in the upper Midwest instituted many laws intended to protect small businesses from being put out of business by big money interests. ‘Combinations of masters’ as it were.
Of course the Communists, the original Globalists, promise paradise but ultimately just offer to replace one group of oppressive elites with an even more oppressive (and frequently incompetent) elitist clique. Mussolini, originally a Communist, came to the conclusion that Italian workers had no feeling of solidarity with workers in foreign lands and vice versa. He wanted to unite his country, worker and business owner alike. So Mussolini’s Fascism featured a state controlled economy, but at the same time did not abolish all private property, like the Communists did in Russia. Mussolini’s “third way” socialism was adopted by the German National Socialists as well. Ultimately though ‘national socialism’ doesn’t work any better at producing and distributing goods and resources than ‘international socialism’ (Communism), or slave labor societies, as experience has shown us. The writings of the economists of the ‘Austrian School’ of economics went on to explain to us in detail why this was always so.
The commies must be the most nefarious liars in the entire power structure, as they layout the bones of the machine they will use to enact tomorrow what they decry today.
“We rarely hear, it has been said, of the combinations of masters, though frequently of those of the workman. But whoever imagines, upon this account, that masters rarely combine, is as ignorant of the world as of the subject.
-Adam Smith, “On the Wealth of Nations”, Book I, Chapter VIII, pg.80 (1776)
FYI. Besides Price’s Law there is also very similar “Pareto Principle”. “The Pareto principle (also known as the 80/20 rule, the law of the vital few, or the principle of factor sparsity) states that, for many events, roughly 80% of the effects come from 20% of the causes.” According to this principle then 20% of all work produces 80% of the results. 80% of sales come from 20% of customers. 20% of hazards produce 80% of injuries. In sports 20% of training produces 80% of the impact in competition. British physicist Price looked at value creation from the viewpoint of the work that people did whereas Italian economist Pareto looked at it from the standpoint of the results produced. But they both came to the same conclusion that an astonishingly small number of people and events are involved in actual ‘value creation’. That is to say producing the satisfactory end results for which any enterprise or activity is created.In military terms, 20% of your troops/weapon systems do 80% of the killing in war. For example artillery and machine guns inflict the major share of casualties. It has also been recognized that about 20% of fighter pilots and tank crews accomplish 80% of kills. Likewise 20% of your troops suffer 80% of casualties.
Interestingly enough, both U.S. business and military leaders (whether intentionally or not) tend to use many of the management methods of Taylorism, from US industrial engineer Frederick Winslow Taylor (1856-1915). In his book “Principles of Scientific Management” (1911) Taylor laid down the fundamental principles assembly line manufacture. Every task was broken down into precisely measure segments so wasted effort could be eliminated. Taylor also assumed that the line workers were unmotivated and would only work as hard as they need to escape punishment. “Soldiering on” Taylor called this. For that reason Taylor believed the workers had to be constantly watched and supervised.
So ironically enough (or perhaps not so) one notices that American Army commanders during WWII tended to over-supervise their subordinate leaders much more often than German Army commanders. The difference was that German Army leaders from squad leader to regimental generally knew their jobs better than their American and allied counterparts. German commanders generally trusted their subordinate leaders to know their jobs well and be able to solve tactical problems on their own without close supervision (they were trained to be that way). COL Trevor Dupuy in his Tactical Numerical Deterministic Model study of leadership impact in WWII he found that 100 German Infantry soldiers were generally as effective as 120 American or British infantry and 250 Russian soldiers. As the war progressed and the U.S. Army grew in experience and the German Army suffered severe losses the U.S. Army became more effective and the German Army became less so.
Nevertheless while over-supervision didn’t work on the battlefield, it did the trick on the Homefront. “Taylorism was a critical factor in the unprecedented scale of US factory output that led to Allied victory in Second World War, and the subsequent US dominance of the industrial world” (businessdictionary.com/definition/Taylorism.html)
I guess what this all tells us is that most people suck at what they do and aren’t particularly motivated to do it. For good or ill small groups of motivated people are what make important things happen.
Underestimating the common man is never a poor bet.
thanks for this information, Jeremy!
Call me a lazy no good shirker if you like, but the 20% who do most of the work can go fuck 'emselves. This applies to low wage and working class jobs. Going above and beyond expectations, working your hardest, doing other people's tasks, never works out to the benefit of the hard worker. Injuries and fatigue will occur, and while you may get a slap on the shoulder or an "atta boy" from the boss, real financial rewards for hard work are rare, you're basically just giving the boss a good deal, the labor of two for the price of one.
There's the right way to do a job, a smart way to do a job, and then finally there is the way the boss wants it done, which is never one of the first two.
All that hard work and dedication to your employer, or perhaps just that old school protestant work ethic, will often times result in the loss of your employment due to something going wrong in your race to complete a task that you were not following company procedures on.
Unless you work for a small or medium sized company that appreciates and treats its employees well (rare), this dedication to an employer is extremely misplaced. I've seen it countless times where the dedicated employees who are the hardest workers end up getting fired for deviating from protocol, or fired for the sole reason that management is running out of things to do and need to justify their own existence. Even in a union setting, the bosses have figured out that the hard worker is easy to fire, he's not the guy to fight and try to get his job back, he's the guy that just goes down the road and gets another job somewhere else.
In 21st century america, where so many employers are merely subsidiaries of multinational behemoths, there is really no incentive to do any more than the bare minimum on the job. Doing otherwise is at your own detriment.
Just remember, if these corporations could find a way to compel you to work for free, they would.