The Big Jobs Myth: American Workers Aren't Ready for American Jobs

[xchrom]

http://www.theatlantic.com/business/archive/2012/07/the-big-jobs-myth-american-workers-arent-ready-for-american-jobs/260169/


A specter haunts the job market. You've witnessed it on the campaign trail. You've seen it on TV. It is the idea that the skills of U.S. workers don't match the needs of the nation's employers.

This "skills mismatch" is routinely held up to explain why the unemployment rate is still at 8.2% three years after the Great Recession officially ended, and why nearly half of those out of work have been so for more than six months. The Romney campaign affirms that the skills mismatch "lies at the heart of our jobs crisis." In his State of the Union speech, President Obama quoted conversations with businessmen who can't find qualified workers, and then proposed "a national commitment to train two million Americans with skills that will lead directly to a job."

It is heart-warming to see Democrats and Republicans agree, but unfortunate that the thing they agree about may not be true.

In recent months, researchers from the Federal Reserve Bank of Chicago, the University of California-Berkeley, and the Wharton School have expressed skepticism about the existence of a national skills mismatch. A larger body of work, stretching back decades, paints a murky picture about how broad-based a problem worker skill level is. Despite this, policymakers have fretted about the issue for 30 years, in periods of high unemployment and low. If the research is far from certain, why does the skills-mismatch narrative stay with us? And by fixating on mismatched skills, are we ignoring a far bigger problem for the economy?

[TwilightGardener]

1. The only "skills mismatch" that appears to exist is that businesses want to hire employees that

have years of experience on all their systems, equipment, and software, right out of the box, with no training whatsoever, and yet are still willing to start at entry level wages and work on a "contract" basis.

[Xyzse]

2. Agreed with this

They do not want to invest in training or anything any more.
Which makes workers far easier to get rid of for them since they don't want to deal with training any more.

[Scuba]

9. Bingo.

[Mopar151]

11. Yes, that is the fantasy of every bad manager

And they want to hire highly skilled craftsmen on a "part-time, as needed" basis

[gkhouston]

21. +1. Just a touch over 30 years ago, companies still had the attitude that they were hiring

workers for their ability to think/learn, they'd train you to do the specific job, they'd re-train you as necessary, and they'd probably employ you for decades. I'm not saying that they expected English majors to become programmers (although some did), but they didn't expect a programmer to know each and every piece of software they used. The ability to code well in a language or two was enough, even if it wasn't the ones the company used.

Then employee pay flattened out, and people started job-hopping because it was the only way to get a meaningful raise. Rather than increase pay/benefits to retain employees, companies gradually stopped training and began treating their employees as off-the-shelf short-term commodities rather than long-term assets. Hence, the "skills shortage" which IMO, truly is a pay shortage.

[Proud Liberal Dem]

3. Seems like the problem has an obvious solution

Helping people get some job training, subsidizing companies to help them train willing workers? Telling our hallowed "job creators" to train these people so that they have a workforce. It ain't rocket science.

[TwilightGardener]

5. When I hear "job training", I assume one is speaking of taking a high school grad and putting him

though some sort of six-week or six-month job-specific training program (and then the company hires him, hopefully). But those already exist, they're called community colleges and for-profit schools, and there are millions of people out there footing the bill for their OWN training in the hopes of getting an edge on their competitors for that elusive job. So why would the government or companies want to pay for this, when there are enough people WITH the desired education or certification already who can't find work?

I offer my husband as an example--he is seeking an IT security job (having done this in the military), everyone he worked with in IT a couple years ago told him that CISSP was the hot new thing, and he should get a CISSP certification. So he studied for six months, spent hundreds of dollars, and got certified. And...nothing. No one is interested in THIS particular certification anymore, apparently. And now employers want a shitload of other stuff ALONG with security certification: ITIL, PMP, CCNA--the fucking certifications never end, and he simply has to pay the money, spend the time chasing them, hoping they're still "hot" when he finally finishes them. Still no guarantee that anyone will hire him, of course, and the jobs that ARE out there are offering him what they used to pay new grads 10 years ago ($42,000 for a network administrator??). He is having an impossible time trying to figure out WHAT these people want. Yesterday he lost out on a job because he didn't have enough experience with their particular VOIP phone system. He could learn that shit in weeks. It's fucking ridiculous.

[Wounded Bear]

4. It's ad-speak....

The industrialization and commercialization of our education system continues unabated.

Much of the rhetoric these days is designed to get people into the for-profit education industry, much of it supported with government grants and loans. The reality is that thousands of new degreed students are graduated every year, many of whom just go on to inflate the unemployment and underemployment numbers.

[TreasonousBastard]

6. I've witnessed this, and don't know what the answer is...

I spent 20 years as an insurance underwriter and the large companies I worked for had training programs. The training was usually good, sometimes excellent, and occasionally dismal. The problem was that the trainees were all taken right out of college and after two or three years someone would hire them away. We became the trainers for other companies, many of whom had no such program.

Matching the offer was considered, but since this was so common we didn't want to set up a sort of "free agency" system that could be worse. In general, while current employers may be trying to beat wages down, there is the problem of hiring at the peak of wages and then business slows down.

I've been out of that for over 20 years so I have no idea what they're doing now, but at the time it was something we just lived with.

I don't know the details, but Germany has, or had, an apprentice system that protected both employees and employers and seemed to work pretty well. I'm not sure it could be transplanted anywhere else, though.

Wherever the truth lies, it's guaranteed that, whatever the situation, employers and employees will whine about how bad their lot is.

[hay rick]

7. American employers aren't ready to pay Americans for their skills.

Best quote from the article: "When firms post job openings at a certain wage and no one comes forward, we call this a skills mismatch. In a different universe, we might call it a pay mismatch."

Two real reasons for not hiring:
1. Lack of demand in the economy. Employers can hold out for the perfect job candidate because most businesses are operating below full capacity and see little prospect of growth in the near future. If the perfect job candidate doesn't emerge, they don't have to hire anybody.

2. It is cheaper to hire the equivalent worker elsewhere.

Predictably, Obama buys into the business-preferred meme:

In his State of the Union speech, President Obama quoted conversations with businessmen who can't find qualified workers, and then proposed "a national commitment to train two million Americans with skills that will lead directly to a job."

I know the President is talking to businessmen who can't fill jobs with qualified Americans. I wonder how much time he spends talking to highly skilled Americans who saw their jobs sent overseas and can't find comparable replacement work with their suddenly "mismatched" skills?

Good article- K&R.

[4th law of robotics]

8. I would like for use to raise the minimum wage while working on

removing illegal immigrants. That would simultaneously "create" jobs while encouraging Americans to move in to them.

Picking lettuce for 4 bucks a day with no worker protections? Meh.

Picking lettuce for $20/hour with decent worker protections? Well alright then.

/lowering SS age, providing more money for secondary education and trade schools and reducing the 40 hour work week to something like 30-35 hours would help to (oh and add some vacation time in there).

[TwilightGardener]

10. How much would a head of lettuce cost if the pickers made $20 an hour, though?

I don't think they're usually paid by the hour, anyway, they're paid by the amount they harvest. If you've ever seen them, they literally RUN their asses off nonstop. I don't fault hard-working immigrants, illegal or otherwise. We're all in the same boat--just struggling to survive and find opportunities where we can.

[4th law of robotics]

12. Not much

a 40% increase in labor is estimated to increase the average families food budget by 16 dollars per year.

http://www.epi.org/publication/farm_exports_and_farm_labor/

/how much would a cheeseburger cost if you had to pay the guy flipping it 10 bucks per hour rather than 7.50? About the same. How much would a movie cost if they were paying the ticket-taker a couple bucks more per hour? About the same. Labor costs for minimum wage jobs generally aren't a major contributer to the overall price.

//and it's not about blame. I don't begrudge anyone who wants to work to provide for themselves or their family. It's about practicality: we have only so many low-wage manual labor jobs. When we can't find enough for Americans we really have no need to import laborers.

[NickB79]

13. Going from $4/day to $160/day is way more than a 40% increase. nt

[4th law of robotics]

14. I was exaggerating with the 4 bucks per day

The article estimates it at around 10 bucks per hour.

Meaning 20 per hour would roughly double wages and by this estimate lead to an increase of . . . . 40 dollars per year on groceries for the average family.

By the money we save on social services for those people who can now feed themselves we could easily afford a slight increase in food stamps for those who cannot afford that 40 dollars per year. And for most it would be a trivial amount.

[TwilightGardener]

15. See, now you're talking a few bucks more per hour, not zooming from $4 to $20.

Hell, many people in this country working at jobs that require professional degrees or certifications don't make $20 an hour. Pretty sure lettuce pickers aren't going to make that, UNLESS they're superhuman and can pick like the wind. Otherwise, I agree with you, paying a better wage for burger flippers and farm workers SHOULDN'T cost us that much more. But businesses seem to love finding excuses to pass cost increases along to consumers in amounts disproportionate to their actual costs.

[4th law of robotics]

16. I'm amazed at the opposition on this website to increasing the minimum wage

When we're talking college kids who can't find work people seriously propose a 25+ hourly minimum wage and are cheered for it.

When I propose that should apply to farmers as well: OMG think of the costs! Lettuce may go from 1 dollar a head to 1.15. Outrageous!

Imagine how cheap everything would be if we scrapped the minimum wage and all worker protections. Heck, slavery was pretty cheap, think of the savings if we brought that back.

[TwilightGardener]

17. I'd love a minimum wage of $25 an hour, but then all wages would have had to increase

by at least some proportionate amount in order for that to happen, and then the cost of everything (housing, cars, food, etc.) would go up to suck the same amount out of your paycheck. I agree with trying to increase the minimum wage, but you have to be realistic. If you pay unskilled people $25 an hour, what do the skilled/degreed workers get?

[4th law of robotics]

19. You don't think that would happen?

If you can make 20 bucks per hour standing around in starbucks or 20 bucks per hour in a skilled or semi-skilled trade (say hauling concrete at a construction site) who is going to choose the harder job?

It would necessarily raise all wages.

And I wouldn't push for doing this overnight.

My ideal plan if I had my way (still about 10-15 years from a benevolent dictatorship headed by yours truly though) would be to gradually increase it up to 20 dollars per hour over a period of years and then permanently peg it to the inflation index.

Say a buck fifty per year for the next 8 years or so. And throw in there a slight reduction in the work week every other year (39 hours this year, 38 in 2014, 37 in 2016 and so on) and tie that to further increases to offset the lost hours (working 39 hours instead of 40 is a decrease by 2.5 percent of your weekly earnings, so increase wages an addition 2.5%).

Gradual changes would still bring about benefits for those at the very bottom without causing a massive economic upset at a time when things are fragile enough as is.

[Ganja Ninja]

18. We need to start offering incentives for keeping Americans employed.

And we also need to to use disincentives to not keeping American's employed by linking the top 1 percent's tax rate to the unemployment rate. Here's my plan.

If unemployment is 5% or less their rate would be set at 36%.

Thereafter for every 1% the unemployment rate goes up over 5% the top tax rate would be increase 3%.

So if unemployment were 10% you would add 15% to the 36% and set the top tax rate at 51%

As it is now there is no incentive for the mega-rich to invest in America because as long as unemployment is high their tax rates stay low.

[limpyhobbler]

20. A story conconcted to screw us. All workers organize, it's the only way to get any leverage..

The "mismatch" is just the owners' way of saying they would rather pay slave wages. The only way to counter the assault is to organize unions the way our granparents and great-grandparents did. We will never get anywhere unless people start taking some personal risks to organize new unions. We can't keep coasting on the victories of our grandparents and great-grandparents. That's used up. So if we want to get more money for our work, or any guarantee of work at all, we will have to fight for it. The government is not going to solve our problems for us. If anything they will act to benefit the owners. Organize all workers, all races and colors, all trades and professions, and demand fair treatment and an economy that works for the benefit of all people.

[Aerows]

22. American workers

aren't prepared to not get adequately compensated for their work and have no benefits. The canard has always been "if you don't like where you are working, work somewhere else." And people are.

Simple as that.