University Unions on strike AGAIN

Ok. Apparantly some of the University Unions are on strike today (again, since they shut the Library down just a few weeks ago).  So, here we go.

I'm not a fan of Unions, big surprise, and I'll explain why. But first we have to begin with what an employment is. An employment occurs when someone (employer) values the services someone else could provide (employee) higher than the cost for that service (wage + social costs). Likewise, an employee voluntary sells such service when the value of the wage exceeds the cost affiliated with that service (time, unpleasantness, opportinuty cost etc). If some of these conditions are unfullfilled, there's no employment. Essentially, employment is a voluntary exchange of goods and services just like anything else (additionally, there's a bunch of regulations and government restrictions for that when employment occurs, but that's beside the point). It is also influenced by the demand of such services relative to the accessability to it, that is supply.

Only this far, striking would make little sense. If you, as an employee feel you can provide better services elsewhere or you're selling your service for too low amount, the only action for you is leaving. Go to the place that'll value your abilities higher/more accurately. Stop messing around waving signes, playing socialist revolution. Consequently, if you prefer the wage payed to you for the service you provide over whatever your alternative might be the action is staying. Provide that service, and stop hindering the lives of others (in this case, students who require access to the Library; you could even argue that the Unions are liable to reimbursing the tution-paying students for losses due to the strike, but that's also a bit beside the point).

Ok, second of all, now let's consider the points and demands the Union's actually making. The core of it, like most strikes, involves increased payroll. The argument is that 1% increase in salary is actually a cut, because current UK Inflation is at around 3%, thus the salary recieves is worth ~2% less than a year ago. That is correct, in real terms it is a pay cut. And they argue that to be unfair, especially since the UK Universities aggregate surplus is £1 billion a year, or something like that.

Here we have a few issues. First of all, pooling all the surplusses of the 150+ Universities in the country is greatly misleading, but obviously screaming "1 BILLION A YEAR" sounds a lot more intimidating than the actual truth. What's the real deal? So, let's have a look at Uni of Glasgow Financial Statements for 2012:


Uni of Glasgow Financial Statement 2012
Income               £440m

Expenditure       £430m

Surplus:               £10m
Margin:                2,27%

This income consists of some £150m straight from governmental funds, making the income rather risky; political instability, changes of government budgets or conditions for student loans etc can occur rapidly, putting the University's financial position at risk. Hence, if the Scottish Government decided to cut Higher Education expenditure by some 10% or so, the University will be showing red digits. Apart from that, if faced with a reduction of students, not even substantially large, same thing would happen; red digits.

But still, £10, can't the margin be reduced a little? On the contrary, arguying from a financial stability point of view, it should be increased. Tesco, for instance, runs with 5-6% profit margins, and financially healthy companies such as H&M or Apple carries some 40-50% profit margins. Definately no, 2,27% margin is not excessive in any way.

Following that line of thought, if the margin is low already (and virtually can't be reduced), what effects would an increase of wages have? Three options: 1) fire some staff, while others get their salaries increased, 2) allocate more funds to wages than other University costs such as facilities, technology, library etc, 3) demanding more money from the government (essentially, increased taxation).

If 1), you redistribute money from some people to pay others, 2) you reduce the service/usefulness of facilities, university buildings, lecture halls etc, 3) through taxation, you take money from everybody in Scotland, in order to pay for University staff. In either case you're taking money from other groups in order to met your demands, some of which could arguably be a lot worse of an outcome than a general ~2% pay cut. Typical Union thinking.

So consider the entire argument for a bit. The bottom line for this strike is that "University Staff deserves more". That, in turn, relies on the propositions that they can't "make their ends met", implying that they're underpaid. From quickly googling the avarage salaries of Uni of Glasgow staff, I found digits of around £15 000/year for the lowest paid staff (somewhat around the levels of relative poverty line, which I discussed the other week). Probably not accurate for all serviced the staff provide, and I'll look for some more digits later today when I talk to the strikers. Putting that amount into comparable sites such as Global Rich List, gives us the following result:
£15 000 amounts down to top 3,23% income-earners world wide. I hear 'Solidarity'? 'Decent wage', you say?

Ok, striking per se, is absolutly preposterous and riddiculous. BUT, even considering the Unions' demands, the picture turns even uglier; people, top 3%-earners in the world, are refusing to fullfill their commitments on the ground that they're underpaid. For real? Is that some kind of sick joke? An insult to anybody else earning less than that?

To the rest of the world, or anyone with a pair of working glasses, that's like Bill Gates (or any other super-wealthy guy) refusing to work because he finds his wage too low. Get real, and stop striking.