Very soon I’m going to put out a book which attempts to explain Marxist economics in as simple a way as possible. This book I’m going to offer for free as an ebook, only requiring payment to obtain a physical copy. I’d like to share a portion of it now to answer a question that I have been asked in the past: “Why are there people working overtime while there’s high unemployment?” The answer, in a general sense, lies in the relationship between variable and constant capital. In the process of creating value, and the intensification of efficiency, there is a tendency to push some workers out of production, while causing the remaining to put in an increased effort.

Let us assume that an employer employs 1,000 workers, the working day amounts to 10 hours, and the daily wage 2s. He proposes to invest additional capital in his business. He could do this by extending the business accommodation, procuring new machines and engaging more workers. But he could also employ the additional capital, so far as it is not required to obtain further raw material, by prolonging the labour-time of the workers already employed. Let us suppose he prolongs it by 5 hours; the price of labour remains the same; the daily wage will then amount to 3s.; and, other circumstances remaining equal, the variable capital will be increased by 60 per cent., while the number of workers will remain unchanged. It is, however, to the interest of every capitalist to effect an increase of work rather by the prolongation of labour-time or the augmentation of the intensity of labour than by increasing the number of workers, as the amount of constant capital which he has to expend grows much more slowly in the former case than in the latter. And this interest is all the stronger the larger the scale of production. Its force increases therefore with the accumulation of capital.

If the worker’s tool is a spade, which costs 2s., the capitalist wouldn’t be opposed to increasing output via a corresponding increase in the number of workers. The case is different if a worker is operating machinery which costs £5,000.

The accumulation of capital not only comes with an effort by the capitalist to obtain an increase in output without a corresponding increase in the number of workers; there is also a reduction in the strength of the working class to resist this tendency. The excess workers created in the act of the accumulation of capital deceases, by their competition, the power of resistance of the employed workers. The workers still employed are then compelled to submit to overtime work; the working overtime again swells the ranks of the redundant workers. The unemployment of the one determines the overwork of the other, and vice versa.

We see that the accumulation of capital, with its concomitants and consequences, the centralisation of capitals, the technical transformation of old capitals, overwork, and so on, has the tendency to diminish sometimes even absolutely the number of employed workers in relation to the total amount of capital engaged.

At the same time, it increases the number of workers offering their services and remaining at the disposal of capital to an extent that goes far beyond that of the increase of population generally.