Labor and Capitalism
Labour must take the form of the commodity labor-power in order for surplus-value to be produced.
Karl Marx attempts to explain how the commodity labor-power helps a capitalist maximize the value produced. Arguably, this is true. Labor-power is the capacity of human beings to align their mental, emotional, and physical strength to perform activities and do work. In other words, labor-power incorporates knowledge, experience, skills, and intellect to perform operations and lead to value addition. Ideally, people put their labor-power to the market in search of prospective employers. According to Ito, 1988, the commodity aspect appears when the employer who acts as a buyer purchases the labor-power from the employee. Thus, labor-power is exchanged in the market like a product, and the wages or salaries are the purchase prices of the said product. For it to be valuable, labor should be turned into the commodity, which gives the capitalist the power and authority to control, use, promote, and dispose of the merchandise as they please. Besides, the capitalist is now able to gain value from the employee working capacity.
Marx, 2018 contends that The production of surplus-value requires the transformation of manufacturing. This indicates that the output of the extra value from a single unit of labor power involves the alteration of the processes in terms of strategy, sophistication, and technological advancement. The commodity labor-power is expensive, and it takes up a significant proportion of the production costs. Therefore, any company willing to make profits will improve the production process to make maximum use of the labor-power.
Labor power as a commodity makes it scarce, and any capitalist in need of skilled labor-power must aggressively seek it. Surplus value, in this case, will be created by the total cost of labor-power that remains after wages are deducted from the product’s price. The value of any product is measured by the amount of labor as a commodity used to produce it. Therefore, to increase surplus value, the production process must be altered to ensure that the cost of labor is lower than the price at which the produced commodity is produced. Through innovative technology, the sophistication of the production process, specialization, and more transformational aspects, the production process is made more accessible and more profitable. Newer, advanced machinery and methods ensure labor intensity is reduced per unit of production, and therefore labor power is used to produce more value.
Capitalist production begins when the capitalist brings many laborers together.
With this statement, Marx generalized the concept of diversity in the workforce. As indicated earlier, labor-power is the ability to bring together aspects of intelligence, mentality, and skill of a person in producing commodities. Different people come from different backgrounds that form part of their labor-power. Mainly, the education, experiences, and expertise gathered during the life of each construct their personality. This personality adds value to the production process. Wood, 2004 argues that a capitalist goal is to maximize profit and surplus-value. Arguably maximization of surplus-value is achievable through diversification of labor. As many laborers are put together, the capitalist exploits the different capabilities to advance his intended production purpose. The value of work is directly proportional to the number of labor-power commodities available for use by the capitalist. The many laborers increase the amount of labor-power in terms of efficiency, diversity, innovation, critical thinking, and advantageous competition. According to Reuten, 2018, all factors relating to a multitude of laborers lead to the transformation of the production and revolutionizing processes for capitalist production. Ideally, innovation, problem-solving, advantageous competition, and more factors of diversity lead to the improvement of the overall business. The diversity of laborers brings about a variety of beneficial aspects for the capitalist, as shown below.
First, bringing many laborers together begins a fundamental dynamic of technological innovation. This is true since different people offer a wide range of input that can benefit the production process and business. For a capitalist technological innovation forms an essential element in pursuance of the surplus-value objective. Sonnenschein, 1999 contends that many laborers quickly brainstorm, argue, and develop discussions that come up with ideas ranging from wide multi-perspectives and cultural differences, which create room for innovation. Technological innovation increases the efficiency of production, reduces time wastage, and costs and also enables workers to produce more in a given amount of labor hours.
Additionally, diversity improves problem-solving. Many different inputs are brought together to individually analyze, examine, critique, and summarize data on various aspects, such as production planning and solving conflicts. The multiple contributions help to eliminate external variables in decision making. Besides, the solutions brought forward are arguably more improved and informed as compared to individual decision making. The practical problem solving adds surplus-value to capitalist production.
Furthermore, many laborers indeed bring about diversity and union of different personalities and ambitions. These differences foster competition in a capitalist production unit. Each individual competes for various aspects such as wage increase, promotion, recognition, employee benefits, among others. For this reason, it is paramount that each works hard to achieve the targets set by the company to get these rewards. Secondly, according to Sonnenschein, 1999, diversity also increases the variability of ambitions and self-interest goals among individuals. This is true in that as individuals come together in a work environment, they form personal goals that are often in line with organizational objectives. The laborers tend to invest more time, effort, skills, and intellect to the company in search of recognition and status. Consequently, for a capitalist, many different individuals or laborers working to achieve specific personal goals, add to the surplus-value.
The formal subjection (subsumption) of labor to capital necessarily leads to the real subjection (subsumption) of labor to capital
Marx differentiates two types of the subjection of labor to capital as formal and real. Necessarily, work is initially subjected to equity in capitalist production through formal means. In this case, labor is paid using wages, and the capitalist forces the worker to submit their techniques, intellect, skills, and experience to the production process. According to Vrousalis, 2017, eventually, the capitalist exploits the available market to sell end-products of his production process. Capital, in this case, utilizes the existing market, workers techniques, and production methods to create value. However, Marx argues that until labor is infused within the capital, the real surplus value for a capitalist is not achieved.
Fumagalli, 2015 argues that primarily, capitalists take control of the formal subsumption, which differs from the requirements of capital but is guided by the concept of wages. Therefore, to achieve surplus value, the capitalist has to reorganize the labor-power to coincide with the capital requirements, and by doing that, he realizes real subsumption of labor. Arguably, the reorganization of the workforce or labor brings about transformational change to the production process. The changes or restructuring need to take place after each additional unit of labor to fuse the input with the required methods of production and eventually generate surplus-value.
References
Fumagalli, A. (2015). The concept of subsumption of labor to capital: Towards life subsumption in bio-cognitive capitalism. Reconsidering Value and Labour in the Digital Age, 224-245. https://doi.org/10.1057/9781137478573_13
Itō, M. (1988). The basic theory of capitalism: The forms and substance of the capitalist economy. Rowman & Littlefield.
Marx, K. (2018). The process of capitalist production. e-artnow.
Reuten, G. (2018). Chapter 1: The capitalist mode of production. The unity of the capitalist economy and state, 27-81. https://doi.org/10.1163/9789004392809_003
Sonnenschein, W. (1999). The diversity toolkit: How you can build and benefit from a diverse workforce. McGraw Hill Professional.
Vrousalis, N. (2017). Capital without wage-labor: Marx’s modes of subsumption revisited. Economics and Philosophy, 34(3), 411-438. https://doi.org/10.1017/s0266267117000293
Wood, J. C. (2004). Karl Marx’s economics: Critical assessments.