"Whenever you see some business person quoted complaining about how he or she can’t find workers with the necessary skills, ask what wage they’re offering. Almost always, it turns out that what said business person really wants is highly (and expensively) educated workers at a manual-labor wage."
And...
"[Employers] claim that much of our unemployment is “structural”, due to a mismatch between skills and labor demand. If that were true, you should see soaring wages for those workers who do have the right skills; in fact, with rare exceptions you don’t."
That’s been the Dem talking-point for at least a few days.
The reverse is also true.
When an employee complains about his pay, ask him why he took the job in the first place.
Not a fan of Krugman’s “economics” here but I see it all the time as a manufacturing consultant on the inability of business to address a labor shortage with wage incentives.
The Free market is great until you talk about labor, then the games start. H-1b, illegals, off shoring etc. ANYTHING to hold wages down.
This guy (Krugman) is truly an idiot...
“Almost always, it turns out that what said business person really wants is highly (and expensively) educated workers at a manual-labor wage.””
Of course the businessman always wants to pay the least he can to get the job done (which is to get a product or service out AND make a profit).
Similarly the employee wants to make as much as possible, and still get a job.
Now if you have a government that pays you for almost 2 years for not working, and then when that runs out you can get free housing, food, plus a few extras - guess what a lot of people think that’s just fine, maybe supplemented with an under the table job here and there.
That’s what causes structural (government designed) unemployment.
So to fulfill their labor and profit requirements, companies take their businesses elsewhere... or they hire illegals.
We pay above average wages and we are willing to teach the skills - to employees with the necessary character. That's the part we rarely find.
I'm always amazed by people "stuck" in a dead end job; learn something and get a better job.
I know bricklayers that make more than $100K p/y. Not all bricklayers can make that kind of money but the ones that are that DAMN GOOD do.
And Krugman, defying all the odds, is always wrong!
“ask what wage they’re offering”
The wage would-be workers want may just not match what the expected productivity is worth. High unemployment & welfare handouts make not working a viable option, requiring untenable wages for actual work to compete therewith. If the value of the work is less than wages needed to attract a worker, the work doesn’t get done and the worker doesn’t get paid.
Employer funds are not unlimited.
The principle of uniform wage rates states that in a free society there is a tendency for wage rates to be equal within a level of labor but unequal between levels. All other considerations being equal, professional level work requires higher pay to attract workers than skilled labor, and skilled labor requires higher pay than unskilled labor.So if an employer wants skilled labor, he will have to pay more than unskilled labor wages.
Yes, if you offered $1 million per hour, there would be a line for almost anything. But Propagandist Paul Krugman avoids the fact that wages can only go so high before they render an enterprise uneconomic. From articles and job ads I have seen, many would-be employers are offering rather high wages. The “unfilled jobs” generally require highly specialized technical skills and experience, a clean background, high reliability (”character” as someone posted above), etc. (An amazing number of unfilled jobs listed in my area require high-tech skills, intel experience and a TS/SCI clearance, ruling out everyone but ex-mil and gov intel types). The problem is a lack of people with the narrowly specialized skills and reliability to qualify. Investing in training makes sense for both employers and employees only when both will commit to the job long-term. Perhaps employers need to revisit long-term employment contracts, in combination with attractive wages/benefits.
This isn’t the entire equation. Revenue models may not support wage payout of what the market might bear. If an employee is not adding value to a company ABOVE his salary and benefits, there’s no reason to hire him.
I think "increasing shareholder value" is sheer stupidity in some cases. So I save $1.00 per unit on computer chips made in the PRC. Do you really want a communist country as a supplier for computer chips for anything we use in the USA?
Just look at the things the've done with foodstuffs.
If
—no one wants to sweep your floor for $8.00 an hour, and
—everyone would want to sweep your floor for $50.00 an hour, then
—you’ll have to find the number between $8.00 and $50.00 an hour at which you will attract at least one job applicant, or
— sweep your own dang floor.
All y’all smart enough to start and run your own businesses should be able to figure that one out.
Part of the problem with salaries and wages is that there is very limited information available to the average job seeker.
Most people do not know what the median pay is for the job they are seeking, and most people do not know where their skills and performance rank on the broader pay range.
For many managerial and professional jobs, it is actually considered uncouth to discuss salary during the first interview.
At virtually all jobs - white collar or blue - management discourages talk about pay between co-workers, and frankly, most co-workers are extremely reluctant to discuss their pay with others.
Thus, employers hold ALL the high cards on this issue.
HR Departments are highly informed about pay scales.
In fact, ten years ago when I worked in the computer chip industry in Portland OR, every major manufacturer SHARED their blue collar wage scales with every other HR Department.
I think wages and salaries should be completely transparent.
In a public company, the pay of the top officers must be reported each quarter.
A CEO at one company knows exactly what the CEO at another company is being paid.
The result?
CEO pay goes up faster than any other job in the economy.
I think if all companies were required to report the pay of all employees, wages for many jobs would instantly start to rise.
