If You Can’t Find Qualified Workers, You’re Not Paying Enough

Job retraining programs and career-focused education are cool, but skills mismatch just isn’t a big problem with the economy. Business owners who say they can’t find qualified workers are either terrible at business, or are pulling your leg. If they can’t find qualified workers, it’s because they’re not offering high enough wages.

Business types like higher unemployment because it means they have more leverage to lowball employees on wages. Right now the wages they’re offering are too low to clear the market. This is why people need to be hollering not just for some good-enough response to the unemployment crisis from Congress and the Fed,but specifically for full employment policies. We want a tight tight tight labor market that gives workers lots of bargaining power over employers, lots of leverage to  quit, demand raises and all the good stuff.

Comments

  1. GDub says:

    Jon,
    Did you watch a Howard Zinn documentary or something tonight? This has to be the silliest thing you’ve posted on this blog?
    Exactly which “business types” are in favor of high unemployment? I don’t recall too many businesses harkening back to the good old days of the Great Depression or the 1970s. That’s probably because businesses, even more than “holding down wages” like to sell things, and that’s a bit easier in a good economy, when people have jobs.

    Job training IS a problem, because our educational policy pushes young people to take in tens of thousands of dollars in debt to go for a BA in sociology and discourages them from getting good technical training (for free) in high school.

    • Jon Geeting says:

      Read the Michal Kalecki essay and then turn on CNBC and tell me you don’t hear Wall Street guys expressing the politics he’s describing. Business owners prefer some slack in the labor market to full employment conditions.

      I don’t think you can point to any actual evidence of a skills mismatch.

      • GDub says:

        That’s not what you said. You said business types like higher employment, implying like it is now.

        Of course businesses like paying lower wages (to the extent that they get the quality they want). But businesses don’t stay in business by paying lower wages–but by selling goods and services. Harder to do that in a bad economy.

        I sympathize with the challenges of student debt. However, when our government encourages liberal arts education at a high opportunity cost with large amounts of loans–you create a skills mismatch.

  2. John says:

    GDub said it well. This post makes no sense whatsoever from a business perspective and he’s dead on regarding worthless college degrees.

    I’d add another aspect – Gen Z and Millennials often look down on people who work in construction trades, that type of work is ‘beneath them.’

    We have a real crisis in this country regarding skilled labor. Unions aren’t filling that gap because their focus is protecting older union workers at the expense of younger workers, and it’s compounded by the fact that today’s kids think working their hands is something only poor, illiterate illegal immigrants do.

    • Jon Geeting says:

      Nobody’s looking down on construction trades. People should try to get jobs at their level of education. If we had full employment conditions, people wouldn’t have to take jobs below their skill level. Your prescription is for everyone to just lower their standard of living, rather than try to get economic policy right. That’s fucked up.

      • John says:

        Do me a favor – the next time you’re with your friends, tell them you’re thinking about becoming an apprentice pipefitter with Local 1 in NYC, and come back and tell us the reaction.

        I’ve seen it in many instances. If this is an honest test, I’d wager you’ll see laughter, derision, racism, and elitism.

        It’s disgusting.

Speak Your Mind

*

* Copy this password:

* Type or paste password here:

97,772 Spam Comments Blocked so far by Spam Free Wordpress