NB I have no reason to suppose the story is actually true. Very likely it isn't.
But the motivation the story claims Ford had does make sense. He was in a position to influence other employers' decisions by reputation, not just via the price mechanism.
If there's one equilibrium where factory workers in general end up as unskilled labourers, and another where they end up as skilled, the latter is better for Ford because of the products he happens to sell.
I ran the numbers for our customer service department and made the case for higher wages- our turnover isn't extreme but it is still expensive. Running the numbers, if we paid $1.50 more per hour we'd be in the upper end of our market, and assuming turnover dropped by 50% we would be saving money.
Response from the CEO was essentially 'they aren't loyal enough'. To be blunt, I don't blame them for looking for better jobs, I wouldn't accept abuse from customers for the wage they are paying. Unfortunately, the CEO looks at it as a moral failing in those employees, vs. the fact that they aren't paid enough to give a shit. I lean libertarian, but it seems simple enough to me that paying people a decent wage can be good for the business. Asking for loyalty to a company is BS- I like my job, but the only reason I do it is that they pay me. I'm certainly not willing to volunteer to do this for free, and I wouldn't expect that the people manning customer support are any different.
Expecting loyalty is ridiculous- its stupid that capitalists expect their employees to not be financially-motivated. Simply said, who is really motivated to be loyal to a company for shit wages?
In a call center you give people 30 sec to 2 min to recover after a bunch of calls. If you take that specific moment to complaint people don't know how fast to gtfo.
Like I said, I lean libertarian, but flashy displays of wealth are IMO tacky. It's worse when you are flexing on CSRs that make $12/hr. Our CEO has made displays of how much money he has on the floor, and he seems to think it will motivate them.
Not my department, but I can understand why the customer service managers are pissed off by that. They have enough trouble with retention. It is somewhat disgusting to see a multimillionaire lord his wealth over people making barely over minimum wage. I know these folks, some of them are check-to-check. Answering emails is a horrible job, I wouldn't do it for $100/hr. That additional abuse is unwarranted.
When given a choice, employers would far prefer to commoditize their employees. It gives them far more power in the relationship and lowers their costs. Skilled workers are treated as such, not because employers want it, but because the circumstances don't give them a better choice.
> there'd be a training cost (what the article calls "a costly break-in period") and high enough wages to reduce turnover so as to amortise that cost.
This is exactly what the article says as well. Ford paid his employees very well to reduce turnover and its associated costs. Not because he was trying to create additional demand for his cars.