In his description of capitalism, Karl Marx identified capital and wealth accumulation as the only goal and objective in the capitalist’s mind. Capitalists take care of their infrastructure, machinery and equipment regardless of the state of the economy; however, these capitalists are always ready to lay off employees and increase the working force when they deem it right. The theory of relative surplus population is defined as Marx’s greatest theory is explaining the characteristics of capitalism in a capitalist economy. According to Karl Marx the presence of excess population is the variable that determines the levels of demand and supply of labor in the community (Fred Magdoff, 2004). In his work Marx argues that the reserve army of labor is unemployed in the society. However one would go further to identify the unemployed as people looking for a job, or people unable to work in the community.
According to Karl Marx maintaining a larger reserve army of labor is necessary for capital accumulation. He argues that a large relative surplus population provides employment defined with little wages, a large reserve army of labor provides work when needed for the low amount of fees. As economists, Marx goes further to argue that, a moderate amount of salaries provides for a low cost of production thus elevating profits for capitalists. This section will discuss the relevance of the reserve army of labor in contemporary labor markets. By analyzing the trends to current labor markets, the article will provide a clear description of Marx’s Reserve Army of Labor and its significance in the community today.
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Discussion
The oversupply of labor is a characteristic of capitalism in the modern day community. Large volumes of people enter and leave the workforce in regards to the needs and preferences of capital. During the modern day, workers are facing difficult times due to the constraints emerging from large corporations and the government (Samir, 2013). The presence of the reserve army of labor in the community provides a surplus supply of energy. As a modern job reality, companies have utilized globalization as a means of accessing untapped energy which is cheap and flexible. Cheap labor means low wages which lead to a reduced cost of production. The process of globalization opened the doors to access international investment opportunities, example after the Second World War, companies from the U.S were able to invest abroad where the labor is cheap due to its large volumes supply. Multinational corporations such as Microsoft and Apple have invested and established investments abroad where there are reduced job and social security policies.
Research has argued that the reserve army of labor is always present. Defined with brief and unusual exceptions unemployed workers are ever ready regarding employment. Capitalists can lay-off and employ workers based on the beneficial terms of the company (Foster, 2012). Example during the period of recession, a company is likely to lay off workers so that production costs can reduce. During the boom phase of the business, capitalists may desire to increase the workforce so as to increase production over a low cost of production. In such a community the labor market depends on the state of the business, and the availability of quality labor. A reserve army of labor does not necessarily insinuate unskilled unemployment; rather the unemployed may include highly skilled workers who have no employment at that particular time. Example during World War 2, the economy of America is defined to have experienced rapid growth and development due to the reserve surplus population that existed. Women and young people are often included in the reserve army of labor as they remain in households away from the workforce. However, during the Second World War eleven million individuals left the workforce to engage in war activities. This left the labor market with a high level of demand for energy at the different corporations and organizations of America. Women as the reserve army of labor provided a supply of energy resulting in a steady economic boom that saw the development of America during this period.
The objective drives the modern day business world to capital retention and accumulation. Companies have resulted in establishing investments that yield positive profits and at the same time consume little amounts of money (Nardinelli, 2008). However, in the process of pushing to double the profitability of these investments, capitalists have left the community with decreased job security and social benefits. Employees are experiencing reduced amounts of job assurance and protection. Under the notion of flexibility and privatization capitalists have developed policies that affect the effectiveness of Labor unions in the community. Example established policies support privatization in Europe; as a result, a once mighty British Labor Movement has been pinned down and lessened in regards to its practical nature of protecting the rights of workers. Capitalists can replace and lay off workers according to their will; this explains the reduced amounts of freedom and heightened levels of job insecurity in the labor market today.
The Second World War emphasized the importance of labor and its significance in the growth of the community and social wellbeing. However, research has stated that due to the restricting of the labor market by certain capitalists, labor rights have been weakened and overlooked. It has become easier to discharge an employee due to the excess amount of labor supply that the labor market provides. This has influenced a reduction of social benefits and harsh working conditions for workers in the community (Nardinelli, 2008). Example capitalists have deployed radical reforms that have supported harsh living and working conditions for workers in China. Workers in China currently reside in small and overcrowded dormitories. These workers have to work long hours for a little amount of wage; similarly, their rights if any are unobserved, unprotected and contradicted worker’s unions have been destroyed leaving the worker unprotected. According to research workers in this state face multiple danger, their grievances for a union is at times answered by death penalties. Example workers organizers in Coca-Cola bottling plants have been reported dead after a confrontation in the name of their right to a union.
Different schemes and laws have been passed exposing and exploiting workers to harsh conditions in the objective to capital accumulation. To Karl Marx, this is the standard characteristic of capitalism in the society. Despite a defined number of workers experiencing better-working conditions, the state of labor remains wrong and continues to grow worse. In third world countries, the workforce is seen to move towards the urban areas. In the search for higher wages, workers are moving to cities in search of employment. However, this has only influenced an increase in the volume of the reserve army of labor in the society. Scholars have gone further to argue that the migration of workers from rural to urban areas is only injecting more population in the foreign reserve army and fueling the fundamental characteristic of capitalism.
Conclusion
Focused on the end goal of profitability, capitalists in the society are ready to utilize and enforce the massive amounts of labor present in the community. Over the years investors have focused on elevating profitability through the process of increasing the flexibility of labor management in the company (Fred Magdoff, 2004). Capitalists can hire and fire workers at will, access low-cost production means (cheap labor), enhance profits and invest abroad. As Karl Marx describes it, the reserve army of labor is a primary entity that supports capitalism in the society. The presence of large volumes of workers living and working in harsh conditions is nothing new to Karl Marx; rather it is a pivot that supports an efficient market system and a tool for controlling employees.
References
Foster, J. B. (2012). The Endless Crisis. New York: Monthly Review Press.
Fred Magdoff, H. M. (2004). Disposable Workers: Today's Reserve Army of Labor. Global: Monthly Review.
Nardinelli, C. (2008). Industrial Revolution and the Standrad of Living. U.S.A: Library of Economics and Liberty U.S.
Samir, A. (2013). Three Essays on Marx's Value Theory. New York: Monthly Review Press.
