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Why is the Journal Mystified that Some Employers Are Having Trouble Finding Workers?

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The Wall Street Journal seems truly mystified that with headline unemployment at 9.5% and U6 at 16.5%, some employers are nevetheless having trouble filling jobs. But this shouldn’t seem all that strange when you consider that workers are not an undifferentiated mass, but have particular skills and experience, and live in particular places, and they may not always match up tidily with where employers are and what they are looking for.

The subtext of the piece, however, is that a major culprit is that workers are being too fussy and are not willing to accept what is on offer:

Employers and economists point to several explanations. Extending jobless benefits to 99 weeks gives the unemployed less incentive to search out new work. Millions of homeowners are unable to move for a job because the real-estate collapse leaves them owing more on their homes than they are worth.

The job market itself also has changed. During the crisis, companies slashed millions of middle-skill, middle-wage jobs. That has created a glut of people who can’t qualify for highly skilled jobs but have a hard time adjusting to low-pay, unskilled work like the food servers that Pilot Flying J seeks for its truck stops…..

If the job market were working normally—that is, if openings were getting filled as they usually do—the U.S. should have about five million more gainfully employed people than it does, estimates David Altig, research director at the Federal Reserve Bank of Atlanta. That would correspond to an unemployment rate of 6.8%, instead of 9.5%.

Yves here. Go back and look at the list of why some jobs go begging. The Journal lists three reasons, but there are really only two: employees are not willing to take whatever is on offer (either due to still having unemployment benefits or believing they can find higher-paid work) or due to inability to move where jobs are. Note these problems all have to do with workers, there is no consideration as to whether employers are contributing to this dynamic. For instance, note how the story suggests that workers will need to trade down. Yet many employers turn down job-seekers because they are overqualified.

Yet one can think of reasons why, and the article itself provides some supporting evidence. A core issue is that the employer-employee relationship has broken down. Quaint as it may sound, there once was a tacit commitment: a worker who competent and dedicated could expect to spend a considerable amount of his career at with one firm (in the 1980s, job tenures of less than five years needed to be justified). But as cost cutting and short term earnings fixation became more pervasive, average time of employment shortened greatly. And with that came a major shift in behavior: it made less and less sense for employers to hire talented people with good general competence and character and train them. They’d be unlikely to recoup the cost of the investment. Instead, companies started more and more to seek staff, in that horrid corporate cliche, who could hit the ground running. For instance, headhunters would increasingly be tasked to find someone who was doing exactly the same job at a competitor firm. This tendency goes all the way down the food chain; for instance, I’m told it’s impossible to become a bartender in NYC unless you have at least two years of bartending experience.

Now what does this mean from a price standpoint? If you believe in the most basic construct in economics, the supply and demand curve, if you restrict supply (by requiring that workers have very particular skills), the result is a higher price. Yet some employers seem to think because the economy is in the crapper, they should be able to hire cheaply. But 16.5% unemployment nationally does not necessarily mean 16.5% unemployment in their geographic and skill niche. One example (the article is almost entirely anecdotal):

But other employers with lots of applicants say the pool of qualified workers is small for specialized jobs. Carolyn Henn, head of hiring at environmental consultancy Apex Companies, says she recently received about 150 applications for an industrial hygienist job paying as much as $47,000 a year, which requires special certifications and expertise to oversee projects such as asbestos cleanups. That is about three times the amount she received for similar jobs before the recession. But she says the number of qualified applicants—about five—is less than she got before.

“We’ve always been looking for a needle in a haystack,” she says. “There’s still only one needle, but the haystack has gotten a lot bigger than it was before.”

So an employer who is having a hard time hiring needs to consider that the generally slack labor marker may not be relevant to his market, and he therefore may need either to change work processes so as to require less specialized labor, train workers, pay more, or do without. We see some of that at work in the story:

At Mechanical Devices, which supplies parts for earthmovers and other heavy equipment to manufacturers such as Caterpillar Inc., part owner Mark Sperry says he has been looking for $13-an-hour machinists since early this year. The lack of workers is “the key limitation to the growth of our business and to meeting our customers’ expectations,” says Mr. Sperry. He estimates the company could immediately boost sales by as much as 20% if it could find the 40 workers it needs.

Trips to several job fairs yielded almost nothing, so the company set up a 10-week training program to create its own machinists. Out of the first group of 24 trainees, 16 made it to graduation.

Mr. Sperry sees extended jobless benefits as one of the main culprits behind his company’s hiring difficulties. Many of the applicants he saw at job fairs, he says, were just going through the motions so they could collect their unemployment checks.

Yves here. This does not add up. If the company can afford to spend ten weeks training people (and the additional cost of setting up a course), that suggests it could have offered more than $13 an hour, particularly given the opportunity cost of the orders it could have filled if it had had people on board sooner. The article later notes that Mechanical Devices “hire[s] through staffing agencies to help control health-care costs and maintain flexibility.” Um, that means they fire people as soon as orders fall.

Other employers seem not to recognize they are lowballing:

Paul McNarney, owner of The Mower Shop in Fishers, Ind., says he has been looking for a good lawnmower mechanic so he can guarantee a one-week turnaround on repairs. He received only two responses to an Internet ad he placed a couple of months ago, even though the job can generate income of more than $40,000 a year, depending how many mowers the mechanic repairs. Similar ads he placed before the recession attracted more than a dozen candidates, he says.

“My thought was that in a cr— economy I could probably find somebody good because a lot of people were looking,” says Mr. McNarney, who has been in business for 13 years selling everything from simple lawnmowers to big riding models for large properties. “I didn’t find anybody.”

Yves here. Let’s see….McNarney apparently already has a repairman; this “hire” is to shorten McNarney’s turnaround time. But this “job” appears to be paid on a piecework basis, on referrals from McNarney, and this new worker probably only would get work at a few peak times a years, since the current repairman is presumably top banana. So the $40,000 number is pure BS.

In fact, the logical response to that ad would be to compete with McNarney, not work for him. Why let him take the markup on your time for erratic referrals, meaning no job security? But the subtext of the article is that the buyer, meaning the employers, is always right.

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113 comments

  1. attempter

    That’s what the MSM and the economists always do. In an example like this, one takes a simple supply-demand mismatch and ideologically dogmatizes that all the flexibility, all the give, any unreasonableness, must be on the part of the worker/the public, while whatever is “on offer” from the employer is by definition a natural fact.

    There’s the Status Quo Lie again.

    Oddly, those same cadres turn around and deny the authority of literal natural facts like resource limits. Something like oil is a “free gift” from nature, and physical energy is dogmatically declared infinitely accessible.

    So they carve out a bizarre ideological space for themselves between the physical limits of nature (the existence of which they deny) and the social and political limits of how far they can simultaneously loot the people, exploit them as workers, destroy their democracy and freedom, and sell to them as consumers. (The core contradiction of capitalism.) There too they dogmatically deny there’s any limit.

    In both directions they dogmatically regard their own greed, prerogative, and violence, no matter how deranged and obscene, as normal, natural, non-negotiable on any level, and sustainable.

    We really need to purge these criminals completely, so the producer class and the natural resource pool can be reunited on a rational, humanistic basis.

    The only things we need to have an economy are workers and resources. Under no circumstances do we need elite “managers” of any sort. We the people can manage ourselves in any and every context. By definition managerial elites, in the economy or in politics, are parasites. Nothing parasitic should be tolerated for a second.

    1. DownSouth

      Ah yes, the American worker is starting to feel the weight of the jack boot on his neck.

      And like you say, the economists—-the high priests of neoliberalism—-are certainly doing their part. They play the same role as the secular clergy of 16th century Spain did, the ones who formulated the “religious” doctrines that gave license to the enslavement and genocide of the peoples of the New World. Except this time the “subject race” is the American worker.

      Mexican workers have felt the jack boot of neoliberalism much more acutely than U.S. workers over the last 20 years. The economic dogma used to justify the boot to the neck is neoclassic economic theory, described here by two researchers from the University of Guadalajara:

      The neoclassic economic school analyzes employment using Say’s Law, which indicates that in conditions of equilibrium (macroeconomic), supply creates its own demand. It rejects the idea that lack of jobs or market inefficiencies can cause unemployment. Unemployment is due more to the fact that the available job openings don’t meet the expectations of the job seekers….

      Unemployment is due…to the existence of voluntary unemployment where the jobs available don’t meet the job seekers skills and training, his salary expectations or the job characteristics that he desires.

      And we all know that those economic laws, just like the Pope, are infallible.

      1. attempter

        Their terminology is meant to reinforce that.

        Thus “classic” unemployment is the kind which is to be fixed by can-do things like obliterating minimum wage laws, safety regulations, unions, etc. The name says it all – “classical” unemployment, the normal kind, the regular kind which can easily be solved.

        Meanwhile any unemployment which can be argued to be the fault of predatory arrangements and practices, where it’s the employer who ought to and can have his hash fixed – well, there it’s “structural” unemployment, “frictional” unemployment (the latter often called “voluntary”).

        At any rate, the names are forbidding, the problem is meant to sound intractable.

        (And of course cyclical unemployment is an unconcept, not to be mentioned among respectable people.)

        1. sgt_doom

          All excellent and intelligent points, but I suspect this is the usual National Association of Manufacturers (or Technical Association of America) planted story, just before they lobby congress again for more H1-Bs or more waivers from Governor Gary “offshore” Locke at the Dept. of Commerce….

          1. Doug Terpstra

            Ah, you perceive the tangled web they weave! Rupert Murdoch’s WSJ articles are never, ever what they appear to be.

      2. Justicia

        Ah, yes. In the perfect micro world of perfect markets the Great Recession would never have happened. And pigs can fly.

      3. Doug Terpstra

        This reminds me of our own hero John McCain, who, in 2006(when he was ‘for’ immigration reform and open borders before he was against them) trashed American workers by saying, “I’ll offer anybody here $50 an hour to go pick lettuce in Yuma this season…for the whole season, not just one day…because you can’t do it, my friend.” Of course McCain also had, as his economic advisor, Phil Gramm, who called our ‘rough patch’ a “mental recession” and Americans a “bunch of whiners”.

        http://www.youtube.com/watch?v=rWOZKeOauNI

  2. Vernon Bush

    Hello,

    I can state without doubt that there is a shortage of persons with certain skill-sets and have many first hand experiences of skilled jobs going wanting….

    Several years ago in Tampa shipyard our vessel was brought in for its shipyard period. At that time they didn’t have enough skilled welders. They sent as far away as South Carolina and New Orleans to find the welders they needed. These specialized welders were making over $50/hr.

    I work overseas on an O&M contract, 4 months on/4 months off. Last time they couldn’t fine an electronics technician with the required skill-set to relieve me. They finally talked someone into coming out of retirement and I got a relief. Don’t know who is going to relieve me next time as they can’t find ET’s with the required skills (this job pays approx $80K/yr)

    When I was home last time my stove quit working at one burner. I troubleshoot it and identified a bad switch. Taking it out I went to the local independent appliance repair center. The owner asked me how I found the switch bad and I explained the troubleshooting I had done. He said “come with me”. He took me to the back of his store and there were two service vans sitting there. He said he would give me one and split the profits with me if I would come to work for him as he couldn’t find anyone experienced in appliance repair.

    It’s the same story I hear from others having skills, there is a shortage of experienced hydraulics techs, there is a shortage of experienced/specialized welders, there is a shortage of experienced/specialized electronics techs. All these jobs pay more than most graduates with a bachelors degree makes and in many cases more than a graduate with a Masters degree if the right specialized skill set is mastered.

    Frankly I see too many young people who want to be sociologists, veterinarians, chefs, Web Page designers, etc. I have tried suggesting some of the skilled trades to nieces and nephews and all I get is the 1000 yard stare. Once America runs thru the Great Reset I’m expecting these skilled jobs will be the jobs begging for experienced personnel and paying well to boot. One other thing… they can’t be exported

    Rgds

    Vernon Bush

    1. Sam

      Sure, man! I definitely know that there is a huge shortage of skilled engineering staff in the chemical process industries, oil & gas, petrochemical and other basic industries.Why? Because in the past 5-10 years most middle experienced level got “downsized” taking their skillset with them. Freshers did not join as they could easily get jobs in banks, wall street type activities, real estate sales, etc that needed basic skills but paid great whereas the skilled jobs in the process industries were as static in pay as ever.The result is a small pool of talented people, a lot of incompetents in positions they should have never held and I fear a lot more mishaps, accidents and plain bad engineering in the years to come. But do the companies realize it-I gues they will after a while, but right now they don’t bat an eyelid for paying a corporate PR or other cushy job for $100,000 but they will expect high end instrumentation technicians/engineers to work for $50,000.

      1. Lyle

        Actually in Oil and Gas the “Big Crew Change” is a result of 10 years of no hiring after the oil bust in the mid 1980s. As a result a lot of folks are now at 25+ years of experience or less than 10. A lot of folks are then at the point of retirement so the skills are not there. (I wonder if this can be hiding behind the Deepwater Horizon incident, lack of depth in the organization due to the 10-15 year hiring drought)One sees the same thing in the RailRoads where a long period of poor performance lead to hiring freezes and today a problem that there are few people able to take the slots that open up as the old timers retire.

    2. ds

      I see your point, but it really has nothing to do with the political/economic argument the article tries to make. You present anecdotal evidence showing a lack of experienced and skilled workers in some areas.

      I highly doubt that there are any experienced, skilled and specialized welders out there passing up on 80k/year jobs just to stay on unemployment. But I am willing to bet that there are many thousands of lesser-experienced welders out there desperately in search of a job due the bust in the construction industry, not to mention those who spent years and thousands of dollars on vocational training only to find that these supposedly ‘in-demand’ jobs are for experienced workers only.

      If demand in the industries you cite was really strong you would see these companies making long term commitments towards training workers with less experience. The reality is that demand is weak and that the long term outlook is uncertain, so these companies are only willing to offer higher wages to experienced workers on a per-job basis. That approach is not going to draw many new workers into the pool.

      1. Eric

        Human nature is no different for employers than for anyone else. No one wants to come out and say that they won’t offer enough wage/benefits/prospects/etc. in their jobs to make it worthwhile for anyone to take them. It sounds ungenerous and is an indirect, but powerful, critique of the management skills of the employer that they cannot use labor profitably at compensation that makes any sense to potential employees. But you have to be true to your business: if offering what it would take to get workers would detract from the profitability of your business, you don’t hire. But saying that out loud is considered less polite than bloviating on and on over tangential issues.

        1. Mysticdog

          But you have to be true to your business: if offering what it would take to get workers would detract from the profitability of your business, you don’t hire.

          Well, there’s the rub. Every employee detracts from the profitability of the business, right? And profit is the highest motive, with no thought of responsibility or sustainability.

          Every year gives another uptick in “worker productivity”, meaning shoving more and more work onto fewer and fewer employees, not paying them a penny more for the extra work, and banking the profit. We’ve simply reached a point now where we don’t need as many people as we have, because of all the automated systems, box store and internet retail, and generally jamming more work on existing employees who better gratefully accept it. Record profits? Hey, give the employees $50 ham certificates, the mannagers $10,000 bonuses, and the executives 3 weeks off for a junket and with $100,000′s extra spending money.

          And a lot of employers have become very adept at bullying their workers, just to make work life that much more unrewarding.

    3. J Liles

      I see your point, but my impression is that for many of the skilled trades, a new worker requires some years of apprenticeship/training to become skilled, and many companies are unwilling to foot the bill for that; rather, they simply expect skilled workers to appear when needed. Similarly, these companies will lay off workers as soon as possible but still expect them to magically appear when demand increases.

      I’m not saying all companies are like that, but my perception is that this sort of short-term thinking is fairly common. The concept of hiring smart people and investing in what it takes to both raise their value and keep them seems to have gone by the wayside.

      I keep hearing that small businesses create most of the new jobs; if this is true, perhaps it is at least partly due to the fact that they are willing to hire smart generalists and allow them to learn on the job or in an apprentice role (this is pure speculation on my part).

      1. Justicia

        In some countries, public schools do an excellent job of teaching skilled trades (Germany, Korea). In this country we push students through 12 years of school and give them no skills that are wanted in the workplace, not even basic literacy and numeracy.

    4. Ray Phenicie

      I understand what you are saying about the lack of respect that certain professions receive-Thorstein Veblen wrote about it at great length in his Theory of the Leisure Class
      http://xroads.virginia.edu/~hyper/veblen/veb_toc.html

      I would not blame the youngsters for turning up their noses at certain jobs-our whole society constantly degrades whole segments of the work force and so others fill the empty niche, the Chaldean, the Indian, the Bengali, the Mexican, the Colombian the . . .

      My memory though was scarred for life by an ad in a paper, I’m living in Southeastern Michigan in the environs of Detroit- I saw several years ago for journeyman skilled machinist-the employer wanted certificate, two years college and some experience. The magnificent sum of $13/hr was being offered when the going rate for the surrounding area had to be around $18-$24/hr. The add was worded ‘will train newcomer to field’ which tells me, as Yves points out above, that the exploitation card was being played big time. And I have found that employers could be said to be meeting at midnight on that one-’openly cajole the fresh meat and turn away the old codgers who know better.’

      I firmly believe business owners have nobody but themselves to blame when they wail on the oldest blues song in town
      “Good help
      Is
      So
      Hard
      To Find.”

    5. VJ

      Yep, it’s way more complicated than either story contemplates, and we’ve got a massive under employment situation, as well as a massive misallocation of efforts in sectors where there’s demonstrably less opportunity. Plenty of the young don’t want ‘outside jobs’ where they might be getting ‘dirty’. They want nice clean, safe ‘indoor’ jobs that may just pay half of what their dads made, at the same age doing the ‘dirty job’! Some things are required & necessary for upkeep & repairs that need to be made. Teachers? Professors? Can be fired at will today & are, by the 1000′s.

  3. Jojo

    Excellent post! I wish you had made it at the beginning of the weekend so I could give it more attention.

    “Employers and economists point to several explanations. Extending jobless benefits to 99 weeks gives the unemployed less incentive to search out new work.”

    Statements like the above are, to put it bluntly, pure bullshit if you are talking about professional white-collar work. Maybe the people who old this contention are focusing on jobs like waiters, retail people and entry level blue-collar people?

    I recall reading that the average unemployment benefit is something like $330/week. That works out to $8.25/hr on a 40 hour week. In Calif., the maximum benefit is $450/wk which works out to $11.25/hr. Meanwhile, even a lowly $40k job works out to $19.23/hr on a 40 hour week.

    Given that most people live check-to-check according to most stories I have seen, does it seem realistic that any white-collar worker wouldn’t accept a $40k (or greater) salary? No!

    What I see in the job ads are, as you note, all kinds of MUST haves or requirements designed to limit the universe of acceptable people.

    Must have x years of experience in something. Must be currently employed. Must have a GPA of 3.0 or higher (obviously, a roundabout way of practicing ageism). Must have held no more than 3 jobs in the last 10 years. In the sales game, must have been in the top 10% in previous company (if someone was a top 10% performer, it is doubtful that they are looking for a new position). Or they are offering only straight commission for sales jobs (if a company can’t pay a base salary or at least non-recoverable draw until the person gets established, the probably shouldn’t be in business)

    Then there are the companies advertising blind. If a company won’t give up their name, they are automatically suspect in my eyes. Who are you applying to? What is their business? Are they GU for you? How can you prepare for a conversation without knowing who they are?

    Often, I see the same companies running the same ads week after week, month after month. That is an immediate negative also. Either the company is being too picky and can’t find ANYONE who fits their elevated requirements or else they might be a revolving door company where people last only a short time before they are kicked out and replaced.

    There are so many varieties of exclusions that it is a wonder that anyone gets hired at all!

    1. Robespierre

      You are %100 correct. I see the same thing in the technical field. As a matter of fact I’ve seen companies asking for 10 years of experience on something that has bee out in the market less than that (Vmware come to mind). So candidates are forced to lie in their resume to get past HR and into the hiring manager. Hopefully the manager will not be a moron and will realize that skills are transferable to other areas

      1. Jojo

        BUT you have to get past the HR screen and interview first before you can get to the manager. That is not easy to do.

          1. Attitude_Check

            AMEN! A root cause issue is the mistaken belief in HR that people are fungible – as long as all the check boxes are met. Of course this is utter nonsense. The best thing most large corporations should do is get HR out of the hiring bit altogether and put it at the highest level in the organization that actually has sufficient domain knowledge to recognize a skilled person.

            The US workforce will HAVE TO BE RETRAINED from service jobs to production and manufacturing, because WE MUST balance our trade in order to recover — and some day we will. A major structural impediment is the US workforce is geared and has experience in service jobs that are going away — and will not return.

    2. sgt_doom

      The one and only true entitlement program America must end:

      Debt-financed billionaires !!!!!!!!

    3. Leigh

      Thank you! I am so sick and tired of hearing Congress and journalist talk about unemployment compensation causing people to NOT look for work! Trust me, I would much rather be working. I do not look for work only to satisfy my the unemployment requirements. As was stated by Jojo, here in CA the highest amount you can make on unemployment is 450/week before taxes. That is $1800/month! I used to make a 6 figure salary, now I struggle as a single parent (with no income from any other source) to house, feed, and cloth my children. I do not qualify for any of the state resources, for which I paid into with my taxes, because I made too much LAST year. Have any of you tried living on 1800/month in CA? Don’t suggest moving, can’t afford to do that on 1800/month either! From week to week I do not know what I am going to do. Any temporary work (for ex you work and 8 hr contract) I take to supplement my unemployment is actually not a supplement, because I loose the $450 for that week (I receive the statement that I made “excessive income for that week”). So when I hear people say that people, like me, want to stay on unemployment I want to stand on a podium and give them a lecture. When Orrin Hatch proposed that people on unemployment should have to undergo DRUG TESTING (as though we are the dregs of society) I was so angry I called all of his offices and my senator’s offices, something I have never done before. I found this suggestion insulting in the extreme. Congress plays with unemployment benefits like it is a game. These benefits are the difference between a roof over our heads and the streets in many cases. I work every single day to find a job. Now to read that companies are not hiring people who are currently unemployed! What is this country coming to? We have had the worst economy in decades, organizations laying off in droves, and I know for a fact that this is not performance related…many organizations layoff based on hire date or the fact that you are a contractor, etc. There are many reasons. I have to wonder about an organization that would state that they would not consider someone who is currently not working! I actually do not this I would consider working for them!

  4. ds

    Wow. Sorry you had to actually read this article. Reading your snippets was hard enough.

    The article falls prey to the fallacy of composition. On a micro level, there probably are some people weary of accepting a lower-paying job given they have extended unemployment benefits. But if higher-skilled workers start accepting low-skill jobs, what happens to the lower-skilled workers? We would only see a shift in the composition of the unemployed rather than a reduction in the aggregate amount. This of course is not to mention the lowered incomes as a result of falling wages and lowered demand due to less unemployment benefits.

    It may be tough for some employers, but they all have an easy solution which is to offer a higher wage or train on the job. If the employer cited in the article really believes he can boost sales by 20%, he can raise his offering wage by at least that much as well.

    A more balanced report might also want to interview one of the many millions of people who have invested many years and thousands of dollars into vocational training programs only to find that there are no jobs upon graduation.

    The bottom line is that there are 5 jobless for every vacancy. What these employers need is strong demand for their products and not cheaper wages from harder working employees.

  5. purple

    Employees know they won’t get any loyalty , so they don’t give any loyalty. The average person knows the wealthy are a bunch of gangsters so why should they ‘play be the rules’ ?

    But overall, it’s just a symptom of an empire in steep and irreversible decline.

  6. Neil D

    What a great summary of the problems facing workers today.

    Although employed full time, my attitude is one of a contractor. All the talk about development and loyalty is so much nonsense anymore. Maybe that’s how it should be if your only goal is profit this month. Piecework, commission, outsourcing – all these things are ways of using skilled and experienced labor without investing for the long term.

  7. Neil D

    After reading the WSJ article I have one more comment.

    Although its clear that the WSJ thinks the mechanic who passed up jobs paying less than his unemployment benefit was wrong to do so, I think that’s how it should work. Losing one job should not condemn you to lower wages for the next. People are smart to use savings and unemployment to find the best job they can. Aren’t we all better off when skilled labor is properly compensated? The fear of hiring over qualified workers is that they will quit when they find a better job. By skipping over the lower paying job, he saved that employer (and himself) the trouble of making a second job change.

    This is a good thing.

    1. Justicia

      It is the duty of the workers to accept whatever capital deigns to give them.

      Of course the WSJ screamed that banksters who didn’t get munificent (taxpayer subsidized) bonuses would flee their jobs — even in the midst of the financial crash when thousands in the industry were being laid off.

  8. craazyman

    I’ve been self-employed for much of my professional adult life.

    There was a point where I ceased to be a human being.

    I found that I had become a “resource” that gets turned on and off like a water faucet. Well, that’s life, I know.

    The level of stupidity and vapid incompetence that I’ve observed at the corporations who have employed me is nothing short of astonishing — even for someone world-weary and jaded such as myself.

    There’s always that part of you that retains a human capacity for hope and wonder. And that part is always floored by the descent of civility, integrity and even basic manners into ever lower levels of deviancy from what used to be considered “socially acceptable behavior”.

    The waste. The bloat. The brutal incompetence of those in charge. The preening narcissism. The “meetings”. The meetings about the meetings. And then the meetings about the meetings about the meetings. The never ending stream of mindless babble that winds like a polluted stream in ribbons around itself to nowhere, toxifying all that it touches. I think it must be a result of the MBA degree’s effect on society. LOL.

    And at the end of it all, after weeks of meetings. There is some grand conclusion. It could have taken a sensible person, alone, half an hour to achieve the same thing.

    And it’s usually a form of trenchant stupidity based on errors, misanalysis and self-delusions seeking not the truth but the safe harbor of conventional wisdom, where no fault can be found. Or almost worse, where no action is required.

    It’s interesting in the comments above. It’s the small businesses that need the workers, but they can’t afford the training. And it’s the corporations now, with all the cash, who don’t have a clue what to do with it, except pay it out in SG&A to the same top executive morons, year in, year out.

    1. Psychoanalystus

      Sounds like you’ve been working as a contract programmer?… :)

      Psychoanalystus

    2. Art Eclectic

      I’ve been an independent contractor for years, myself, and I will second every word of this post. The few times I have accepted a full time position with an employed, I’ve tasted the reality of what is really important.

      Skills? Hahahaha. What is important is showing up on time, being available at your desk in case the boss needs something, not making waves, validating the catastrophically bad decisions of senior management and not making waves. Oh, did I say that twice? Don’t bother being efficient or competent. They don’t want that, it makes everyone else look bad.

      What everyone at large companies wants is for the gravy train to keep spitting out checks each week. That is why there is no responsibility or competence. As soon as some executive’s bene’s are threatened, the layoffs will start.

      1. NOTaREALmerican

        Yeah-but, at my ToBigTooFail Zombie bank there’s the benefit of all this free time on our hands to read Naked Capitalism.

        We are also learning the “art” of employing 5+ times the number of people we need to accomplish a project (of course, we never really quite finish one anymore). What is wonderful about huge companies is they can’t really go out of business. People use the “analogy of the Titanic allot”, so here is mine:

        Large companies are like the Titanic, BUT image the Titanic being SO SO big that even though is hits an iceberg, when it does finally ”sink” it actually is just sticking out of the bottom of the ocean. Enough of the ship is sticking out of the water so that the aft engine room is still spinning a propeller. The officers are still alive and collecting paychecks – and creating bullshit that: once the bow gets unstuck it’s “full steam ahead”. The crew doesn’t care as they get to shovel coal into the boiler. The passengers (stockholders) are still alive so they don’t care either.

        The end result of Extend and Pretend is a Titanic socialist Utopia.

    3. munch paulson

      Once it was “The Personnel Department”. Then it was “Human Resources”. Now (at Goldman Sachs, for example) it is “Human Capital Management”, whose “What We Do Page” states “Human Capital Management plays a critical role in managing the firm’s most important asset, our people.”

      The objectification of employees continues. You’re not a human, you have been deracinated into a thing.

    4. Ivan Karamazov

      I’m with Reno. That was the most righteous and eloquent rant I’ve read in a very long while. You said everything I would have said, but better.

  9. justaguy

    I work in academia as a physicist at a major research university. We just hired an electrical engineer, at a very good wage, after a search that took over a year. We had an extremely difficult time finding a suitable candidate. What I learned from this, and from talking to others looking to hire people in various fields (including retail), is that if you have a skill you can get a job. Good people are hard to find. I also learned that the collapse of the real estate market is a problem for many job seekers. We found a great candidate who wanted the job, but in then end declined our offer because he would have had to move and sell his house at a rather large loss. My guess is that there are more than a few job seekers who are frozen in place for the same reason.

    There’s an interesting article by Michael Schrage of the Harvard Business Review (http://blogs.hbr.org/schrage/2010/07/higher-education-is-highly-ove.html) about how we in higher education are failing to teach our students skills. They graduate with knowledge, but often without the ability to write a coherent sentence. So it’s not surprising that many cannot find a job.

    1. alex

      “We just hired an electrical engineer, at a very good wage, after a search that took over a year. We had an extremely difficult time finding a suitable candidate.”

      As an electrical engineer I can tell you that this doesn’t pass the smell test. What’s a “very good wage”? How does it stack up against the usual industry pay for an EE with those qualifications? How do you know how it stacks up? University research labs are notorious for low pay rates. Why pay a measly EE $X when you can get a post-doc for a pittance?

      Where are you located? Is this in the boonies where there are about 2 EE’s in a thousand square miles? What particular specialization/experience were you looking for? How did you determine who was a good candidate?

      “if you have a skill you can get a job”

      Uh-huh. If you have a skill that’s in demand you can find a job, which is almost a tautology. If you have a skill that was in demand 2 years ago maybe not.

      From the article you linked to: “Great knowledge is not the same as great skill. Worse yet, decent knowledge doesn’t guarantee even decent skills.”

      Yawn. What else is new? The line that “BS, MS, PhD” stands for “bullshit, more shit, piled high and deep” is an old joke of the more truth is said in jest variety. And no, I am not opposed to or unduly skeptical of formal education.

      But how does that explain the last few years of high unemployment? Is it your contention that this knowledge/skills disparity has suddenly jumped?

      1. Psychoanalystus

        Alex:

        I agree. The academia guy is full of it. As a former computer engineer and owner of a highly successful software company, I know lots and lots of highly qualified EE and CS degree types who can’t find a job. I feel sorry for the kids who get an engineering degree nowadays, because there are no jobs for them anymore, and they are not coming back. The fact is, if you are a skilled American engineer, your best bet is to apply for a work visa to China or a Middle Eastern country.

        That’s why I left the field years ago and became a shrink — because you just can’t export a psychologist (although some may try).

        Perhaps his university should have sponsored an EE from India instead.

        Psychoanalystus

        1. hibikir

          A lot of CS degree types that can’t find a job? Send them to the Midwest. If they have about 3 years of experience writing business software, there’s plenty of work to be had.

          Life is tough for recent graduates, as nobody seems to be so desperate as to be willing to train people. That’s where the real hole in IT is.

      2. Robespierre

        Sorry he meant to say: “We had an extremely difficult time finding a suitable candidate willing to work for low wages”

      3. Justaguy

        $100K entry level, which is about $35K more than an entry level faculty member in science makes. He was not straight out of college, but nor would a new faculty member. Hours
        are quite flexible, benefits are good, easy going work environment, and a great city in which to live.

        We are in central Virginia, where I can assure you $100K is a good wage.

        “I know lots and lots of highly qualified EE and CS degree types who can’t find a job.” The highly qualified EE types were not applying for this job, and we were quite flexible in our requirements. All the students I’ve had, EE and physicists have had no problems at all getting jobs.

        1. sgt_doom

          “All the students I’ve had, EE and physicists have had no problems at all getting jobs.”

          Naaah, this justaguy is definitely a call center phony from the TAA or NAM — not in this day, not at this time, not since the dismantling of the US economy over the past thirty-five years.

          That line is just toooo bogus, dood.

      4. Leigh

        I have to agree, this sounds very strange. There is no reason it should have taken over a year to fill this position if they were paying 100,000k in a great town in VA with a great job at uni with flexible hours, etc. Not in this economy. It makes me wonder how picky they were being or if, in fact, he is just making up the numbers. I always wonder about organizations that have such a difficult time filling some of their positions, the market is filled with qualified individuals at this point. I recently was chosen from over 200 resumes to interview for a position at a company here in CA. I went to the interview and found that I was, in fact, over qualified for the position. This did not bother me too much as I thought the job could be challenging (they needed a lot of help) and that the organization could be one that would be interesting to work for as well. I got to the interview and was amazed by the the people they had interviewing me. They asked some to the most ridiculous questions. I answered them with good humor, but wondered the whole time about what they were looking for. When I interviewed with their one contractor, I was able to find out the true nature of the position and the what was they would be needing. I ended up not getting the position and they continue looking for someone to fill this role. I think that if they could only find one person in 200 resumes to interview, and that person was too qualified, then they really need to reevaluate either the role or their hiring process.

    2. sgt_doom

      Why is justaguy repeating that pre-canned neocon biblical remark from Ben Stein???

      “..is that if you have a skill you can get a job.”

      No, dood, that job’s been filled with an H1-B, H2-B, H2-C, L-1, O-1, P-1, P-2, P-3 or offshored.

      Catch a clue! And your remarks, if true, would be the first time I’ve heard of anyone hiring an electrical engineer in America (an American citizen, that is) in over ten frigging years!!!!!!!!!!!

  10. Itamar Turner-Trauring

    I have a friend who is having an extremely difficult time getting an entry level job, in part because he has repeatedly been rejected for being *overqualified*. This in the fuzzy land of product/project/IT management, which makes it more difficult, but still.

    You would think a sane corporate culture would love overqualified workers, since they will be able to take on much more substantial responsibility, but apparently not. Instead, it seems that having a resume that suggests a much broader experience and skillset than the average college graduate is alarming to HR people.

    1. NOTaREALmerican

      Re: Instead, it seems that having a resume that suggests a much broader experience and skillset than the average college graduate is alarming to HR people.

      One problem with IT that I see is this: IT management and HR people are sociable extroverts – and generally have less problem with managing and generating bullshit in their lives (ie, management IS the management OF bullshit). The people they are trying to hire are introverts and – generally – have a very difficult time with bullshit, especially if they are young (wisdom, after all, is JUST the ability to identify and generate bullshit). Unfortunately bullshit is what is needed on interviews and resume’s. THIS very simple fact is separating the bullshitters (managers and HR who NEED people) from the increasing numbers of bullshit-adverse semi-autistic people who need jobs.

      If you want a job you MUST have bullshit skills FIRST. Big companies and organizations exist on huge amounts of bullshit. The bullshitters run them. As society becomes more socialist / fascist bullshit skills will be all that matters.

  11. Jumping

    Business leaders, and the global economy, have routed entire generations of workers we once had. Rapidly changing/evolving technolgy, outsourcing, constant layoffs, cost cutting, and constantly shipping jobs to lower wage countries has taken it toll.

    People aren’t stupid. Once their families/friends train for a whole career for some blue collar job, and the job becomes obsolete by one of the previouly mentioned. They learn to avoid those types of positions that may be in “the cross hairs”. Many of the folks get left behind becuase there isn’t enough time and energy to keep constantly starting over.

    Lets look at one of the jobs mentioned in the article, They call it a “machnist”. I would bet it is really a “machine operator”. BIG DIFFERENCE. A machinist job used to pay $30 or more an hour for being a real machinist. They had to learn how to read blue prints, hold tight dimensional tolerances, use measuring tools, etc…. Now the job is probably a “machine operator” which consists of standing in front of a CNC milling machine and loading parts into a vise. Not fun; A different mentality is required for those two jobs that get a similar end result, a machined part.

    1. alex

      ‘They call it a “machinist”. I would bet it is really a “machine operator”. BIG DIFFERENCE.’

      All too true. Unfortunately the meaning of the term “machinist” got diluted decades ago. As a result the reader never knows what they’re really referring to in an article like this (and the writer probably doesn’t either). Hopefully they do mean machine operator, as $13/hr is pitifully low for a highly skilled job that takes years to learn. Oooh, but machinists can’t be smart like HR people and reporters – machinists get greasy!

  12. Jim Haygood

    ‘If the company can afford to spend ten weeks training people (and the additional cost of setting up a course), that suggests it could have offered more than $13 an hour, particularly given the opportunity cost of the orders it could have filled if it had had people on board sooner.’

    Training new workers is a one-time cost. A higher starting wage — not only for new hires, but for the existing workforce as well — implies a higher baseline for wage increases ever afterward. If the cost of training is less than the net present value of the wage increment, then training makes more sense.

    A second way in which training could make sense is the competitive situation. A company making mechanical devices probably faces foreign (specifically, Chinese) competition paying lower wages. Substituting higher wages for in-house training would have grim implications for market share and future survival.

    If the company has fixed-price contracts with its customers (Caterpillar, et al), it will crater its profit margin by boosting wages.

    The fundamental fact of life, for any business making and selling things, is brutal competition.

    1. Yves Smith Post author

      Jim,

      I’m well aware of the tradeoff. However, $13 an hour is an absurdly low wage for supposedly skilled workers. The 10 week training course is a tipoff. It suggests that the company is an inefficient operator, has unrealistic profit targets, or conceivably might not have a good understanding of its own economics.

      1. sgt_doom

        Any American worker today, regardless of experience and educational background — and other than in the Fantasy Finance Sector — is really lucky to obtain a $13 per hour job.

      2. Jim Haygood

        Previous commenter Jumping, who suggested that these $13/hour employees are likely ‘machine operators’ rather than machinists, is probably right. Skilled journey(wo)man machinists wouldn’t need ten weeks of training, nor would they work for $13/hour. But such people hardly exist in America anymore.

        Nevertheless, if you’ve got 200 existing machine operators making $13/hour and want to add 40 more, the lump sum cost of training the newbies for 10 weeks may be far less than the net present value of paying the whole 240-person crew $15/hour for the next 5 years (assume no raises) in order to attract slightly more skilled people who need only 8 weeks of training instead of ten.

        I’ve been through a similar exercise involving semi-skilled subway car assemblers in the NYC area. Raising wages was the least attractive option, even when higher training costs and opportunity costs (lost profits or liquidated damages for delays) were considered. Strange but true. That’s why economics is called the dismal science. ;-)

    2. Fred Fnord

      Training new workers is a one-time cost. A higher starting wage — not only for new hires, but for the existing workforce as well — implies a higher baseline for wage increases ever afterward. If the cost of training is less than the net present value of the wage increment, then training makes more sense.

      Wage increases? How adorably old-economy. What is the average wage increase for the last three years? For those who are lower on the food chain than ‘directors’, I’ll bet it is literally negative. (And that’s of course not counting layoffs).

      Even before that, for the last twenty years or so, averages real wages after inflation (for the non-rich) have gone down every year. So it’s not that they have to worry about wage increases. It’s that, right now, they don’t want to pay anyone anything.

      Now, you might argue that wages going down doesn’t necessarily mean that individual workers (with more experience each year) have had their wages go down. However, in my experience, which includes two very large multinational corporations, both of them handed raises the same way: each manager got a certain amount of ‘percentages’ to hand out to his employees on raise day. For 2007 (February, so to reflect the work year of 2006) that was 2.5%. If he gave 3.0% to one person, he’d have to give 2.0% to someone else. The inflation rate in 2006 was 3.24%. (The inflation rate in 2007 was 2.85%.) So, if you had the manager who took the easiest course and just gave everyone a 2.5% raise, you ended up making significantly less in 2007 than you did in 2006, adjusted for inflation.

      I have talked to a number of people about this in the SF Bay Area, and I haven’t yet found a company that gave raises that were significantly (more than a couple tenths of a percent) higher than the rate of inflation in a given year to their employees, aside from anomalies such as Google.) Literally, everyone in the tech sector in the best place to be a tech employee in the US was losing ground every year. The only way to increase your pay scale in the tech field around here is to hop from job to job every two years or so.

      I can’t imagine that’s good for the companies. Hell, my last employer viewed it as the next thing to a catastrophe when I left, but while I was there they gave me 2.5% to 3% raises. And discontinued the stock option plan, the employee stock purchase plan, and never had any kind of profit-sharing (they were, needless to say, making record profits.) And steadily increased employee contribution to health care. In the last three years I worked there, the purchasing power of my take-home pay declined by about 8%. (Thank goodness for rent control… my rent only went up by about 6% in that time.)

      -fred

      1. thisthisthis

        You are spot on. There is simply no voluntary pay increase available to employees. One must quit or threaten to quit (which requires you to basically line up another job) to get any kind of actual raise. The biggest problem with this is that the employees know it is disingenuous. Every time I am told that we don’t have money for raises yet can see wasted capital expenditures, wasteful service and vendor contracts and large increases handed out to those who threaten to quit or to hire knew employees I can see that I’m being lied to.

        Corporate America has itself to blame for any hiring difficulties. If you ask me they don’t care one bit and the moans of “can’t find good help” are just complete bullshit to justify under-staffing and over-working (exploiting) existing staff.

  13. Omitted Kingdom

    Have the Republican Senators and Representatives go to the smallest of small towns in their states, and apply for jobs. For Mitch McConnell, Jim Bunning, that means small Kentucky towns like London, Barbourville, Mount Sterling, and Williamsburg, Ky.

    Obviously their choices are extremely limited. Let them take the ACORN pimp and prostitute along to film them as they apply. They can create resumes and keep the US public informed on what responses they received from Sunday classified ads, Monster ads, and any other networking they do.

    Another good source is the Unemployment Office staff in each county. Talk to the staff there to see if they are deluged with people who are unemployed.

    Have Tata Consulting Services audit the US IRS. Last I remember, your corporation’s or company’s name was stamped in the lower left hand corner of the W-2 form. Let’s stratify jobs shipped offshore by state, by county, and I’m certain we could even throw in degree and grade point average (GPA).

    Then let’s talk about George W Bush and Elaine Chao, Mitch McConnell’s wife, the Bush tax cuts, and how they did NOT create US jobs.

  14. i on the ball patriot

    The job chaos is not a mystery, its an orchestration …

    Consider the source — Murdoch’s Wall Street Urinal is a quintessential tool of the man, now pitted in a fake ‘back story’ competition with the New York Slimes.

    Both publications — like all other corporate owned media, and their puppet governments — are now in full agitation mode feeding the flames of divisiveness in the new ruling elite top down orchestration of intentionally created perpetual conflict in the masses. The job chaos is just another blame the victim divisive agitation realm, like the dumb home buyer, the dumb city finance bond insurance buyer, etc.

    Stop reflecting off of, and linking to, these assholes and they lose their power. You will also gain power.

    As for jobs, screw the gangster enslaving corporations and their bottom line thinking, shallow, confining, narrow sphere, boring, ‘jobs’. They are in reality slavery. The goal should always be to follow your joy, to make your ‘work’ your fun. In that effort you will become more self directed, well rounded, secure, and happy.

    Given the internet, its vast store of information available, and the needs to correct the many problems created by these overly centralized corporate assholes and the ruling elite that own them, the opportunities are boundless today. Focus on sustainability, decentralization and fun and balance it with a political effort.

    Sticking it to the man can be a real joy. Diss the man and his totally corrupt system with election boycotts.

    Deception is the strongest political force on the planet.

  15. Siggy

    I think the WSJ article is representative, in itself, of the problem. It’s an article that talks around the problem and does little to fairly report the problem itself. The problem is far more complex than it is made to appear.

    Alex’s comment also goes to the heart of the problem. Oh the difference between machinist and machine operator. And then there is the problem of bureaucratic incompetence noted in the earlier post.

    If a college graduate is incapable of writing a coherent sentence, that is a college graduate who has been run thru a diploma mill. What ever the level of student loan unpaid, that individual was cheated and is a cheat as well in the representation that he is an educated individual.

    Little is said about the fact of discrimination, especially with respect to age and moderate disability. A great many employers are going to find that the employee they seek does not exist.

    The political economy porcess that is in operation is the restructuring of the economy.

  16. Lyle

    There is a solution to the problem of training a contract with the worker that provides that if the worker leaves within 5 years of the major training he repays the training expenses for example 4-5 years 20% 3-4 40% etc. I have heard of the converse with stay bonuses being given to keep people, but for the training issue it solves the problem because the employer is ensured that they will not be out of pocket for the training.

  17. john

    These potential workers are Americans mostly, and even if they’re not they live here and it is likely they have debt and are shackled to a house they can’t sell.

    Between the demand for debt service and the inability to sell the house, the financial industry managed to bomb labor mobility and wage flexibility at the same time they were blowing up their own balance sheets.

    Those guys really are geniuses!

  18. Dorothy

    I can’t believe the article missed three critical pieces of the puzzle:
    1) relocating costs in a dismal housing market (like a couple of commenters said)
    2) HEALTH INSURANCE
    Going from full-time with benefits to part time or self-employed contractor incurs a huge cost in health coverage, often as much as most people would spend on housing. So accepting a part time or contracting hourly salary comparable to your full time salary leaves workers a minimum of 25% behind on your actual income (for my family, it’s closer to 40%). Back in High School economics class, I remember being taught to include 35-40% over hourly rate to allow for benefit costs, but apparently business owners aren’t taught that formula anymore.

    3) Ads that include the line “no unemployed need apply” or HR departments who simply filter out any applications from unemployed workers without reviewing them. I can’t believe this is legal–it certainly isn’t smart!, but it certainly would factor into the point of this article.

  19. eurostoxx

    after reading this post and the comments I have a couple of thoughts

    1) is it any wonder that union and government jobs are in high demand now.

    2) S&P companies have near record high profit margins and productivity is booming

    3) wow $13 an hour. I was making that in high school. It sucks to not have the right skills

    4) The tautology of only hiring skilled workers.

    I love how Americans seem to sneer at the Japanese stagnation or socialism in France. Admittedly they both have their problems but if you working in a low paying, unskilled job in the US I’d take their system in a minute.

    Fortunately, there are still lots of skilled workers and entrepreneurs in the US who dont want that system. But should ever the masses realize that they’ve been duped (which looks like its starting) the US will end up the same way, if not worse

    1. NOTaREALmerican

      Re: which looks like its starting

      Actually, I don’t think it is. The peasants that I work with are MUCH more pissed off at union workers – and their “outrageous pay and benefits” than they are at wall street bonuses, for example. I work for a ToBigTooFail Zombie bank and the peasants I know are “professional” IT people, so are not participating in the Bankster looting programs. There is very little (no) peasants “solidarity”.

      Many Americans still believe the myth of “upward mobility”, especially for their kids (all Americans know their kids are above average – this is NOT a joke; average is bad to Americans). AND equally important, “union jobs” have a stigma of being “loser jobs” (average or worse). Part of the “upward mobility” myth that the peasants believe is that one shouldn’t “settle” for “loser jobs” (if you do, you are – well – a loser. Not above average). This stratifies the peasant class itself into: The losers (average) and those who strive to be better.

      Until Americans look in the mirror and admit the guy looking back is average, nothing can change.

  20. Mannwich

    This is merely all part of the ongoing onslaught of employees by the elites. Nothing more, nothing less. And it will continue as long as we continue to sit back and take it. Thank you, may I have another, sir?

  21. Peripheral Visionary

    @Yves: “So an employer who is having a hard time hiring needs to consider that the generally slack labor marker may not be relevant to his market, and he therefore may need either to change work processes so as to require less specialized labor, train workers, pay more, or do without.”

    But conversely, an employee who is having a hard time getting hired needs to consider that the abundance of jobs in specialized fields may not be relevant to his qualifications, and may therefore need to either move locations, acquire new skills, accept less pay, or go without. If the responses here and at Clusterstock are any indication, there seems to be precious little willingness among job-seekers to do any of that.

    The brutal economic reality is that we are now in a global labor market, and compensation for jobs will adjust accordingly, (at least until such a time as we withdraw from the global labor market, but I see few indications of that happening–and that does not change the fact that we will still be competing with global prices of goods and services.) Employers are not going to pay Americans more just because we have a higher standard of living and demand more–why should they? In a few specialized areas, wages will go up (note that virtually every anecdote cited is related to machine or technical instrument operation), but in many cases, wages will definitely have to go down.

    Both potential employers and potential employees are going to have to make adjustments, but between the two, I expect adjustments to be made more rapidly, and more effectively, by the employers, who have fewer cognitive constraints to deal with (e.g., unreasonably high expectations.)

    1. Fred Fnord

      That post could be boiled down a lot, you know. Kind of wordy. Here’s some help:

      “Employers are under no obligation to pay employees a living wage. Because people in China can be paid a dollar a day, Americans should start getting used to that too. And if that means that the global elite end up with literally 99.5% of the wealth in the world (because, after all, every dollar you don’t pay your employees is another dollars the CEO and the investors can take home), that’s just the natural result of globalization. Celebrate!”

    2. Francois T

      Both potential employers and potential employees are going to have to make adjustments, but between the two, I expect adjustments to be made more rapidly, and more effectively, by the employers, who have fewer cognitive constraints to deal with (e.g., unreasonably high expectations.)

      Fewer employers do have “unreasonably high expectations” than workers do?

      Really?

      You would be so kind to provide some data about that now, wouldn’t you?

    3. PQS

      I might buy your analysis if “brutal economic realities” ever seemed to filter up to the corner office. In my experience, they don’t. Incompetent management gets a pay raise, the truly psychotic get not only pay raises, but also cushy appointments with everything paid for in nice locations.

      When I see the reality of a New Yorker cartoon I recall from years ago, in which a middle aged white guy in a suit behind a desk is telling another middle aged white guy in a suit that he’s going to be let go because “we’ve found Jose here who is more than willing to do your job as CEO for half the pay”, well, then I’ll listen.

  22. Rajiv

    There is also the problem of “Unemployed need not apply”

    http://money.cnn.com/2010/06/16/news/economy/unemployed_need_not_apply/index.htm

    Quote:
    The last thing someone who is unemployed needs to be told is that they shouldn’t even apply for the limited number of job openings that are available. But some companies and recruiters are doing just that.

    Employment experts say they believe companies are increasingly interested only in applicants who already have a job.

    “I think it is more prevalent than it used to be,” said Rich Thompson, vice president of learning and performance for Adecco Group North America, the world’s largest staffing firm. “I don’t have hard numbers, but three out of the last four conversations I’ve had about openings, this requirement was brought up.”

    Some job postings include restrictions such as “unemployed candidates will not be considered” or “must be currently employed.”
    .
    .
    .

    also
    http://www.news10.net/news/local/story.aspx?storyid=84083

    It’s discouraging news for out-of-work job seekers.

    Job recruiters are hearing more from hiring companies who don’t want to consider applicants who are unemployed.

    “It’s happening. Some employers are requesting that applicants already have a job but there are still a lot of qualified people who are not working now,” said Curt Cetraro with Connect Point Search Group in Sacramento.

    California’s unemployment rate is 12.3 percent.

    Some job postings include restrictions like, “unemployed candidates will not be considered.”

    “There’s a perception among employers that if you’ve been laid off, it must have been performance-related. But most of the time, that’s simply not true,” said Cetraro.
    .
    .
    .
    .

  23. Richard

    I’d like to share a recent job interview experience. A VC firm specializing in my area of expertise was seeking to fill an analyst position. At lunch with my executive recruiter, he mentioned that he was having difficulty finding qualified applicants for the position, because the employer would only consider people who had a MBA from Yale, while mine was from MIT. An extreme case of the way “professional” HR job searches are structured, and one guaranteed to fill the position with the person with the most narrow and least creative personality.

    I used to sail with a guy who was a senior VP of a large regional bank (back in the day when we used to have such a thing). He had risen from a salesman in the aircraft leasing division to being in charge of organizing and hiring for three new divisions in the bank with about 600 employees. His comment was that he had never hired anyone that HR had sent him above the level of secretary.

    1. PeakVT

      I had a similar experience from the other end. I applied to a position and a HR person called me for an initial screening. She asked if I had X years on software package ZZZ. I said no and she said the company wouldn’t consider me. I pointed out that package ZZZ had been out for less than a year, and not X years. She got flustered, thanked me for my time, and hung up. I’m glad I wasn’t hired by that company.

  24. CS

    Ha Ha Bailed-out banks protest pay cuts for their top gamblers and the people with solid skills who are financing the bailout get gouged on wages. Then the WSJ editors who would fight to the last dog for their salaries advise skilled men and women to “settle” for something less than jobs suiting their abilities.

  25. ep3

    WAY TO GO YVES! You hit it on the head with this entry. I especially liked how the employers were crying that they couldn’t employ any workers at the wages THEY wanted to pay. That’s like McDonalds mad that they have to pay minimum wage.

  26. S Brennan

    In engineering they look for somebody that has the EXACT skill set, if you have the EXACT skill set, but broader experience…you are NOT qualified.

    Another in engineering one is, 3-5 years of experience, or 5-7 years of experience, at XYZ. Assuming a 40 year career, 2/40=5, or 5% of available applicants are suitable because Legal Dept. has rendered the opinion, as long as we are careful, we can break the law [thanks to Scalia's obscurations] and reduce our medical premiums.

    As a consultant, I have walked into large corporate offices with close to a hundred engineers visible in their low cubes…all of whom were below the age of say 32. At a dinner to wrap things, up the manager noted the disparity and asked me why HR could only find young guy with limited experience? I shrugged my shoulders and suggested to the manager they raise the height of the cubicles so nobody could easily see HR’s handiwork.

  27. cougar_w

    At least in California, schools stopped offering “Voc-Ed” type classes 20 years ago. No shop classes at all could be had, and soon nobody could build or service anything. The “smart kids” who could ace exams or who were great at sports were destined for college (if their parents could afford it) and the other kids were tacitly directed into white collar jobs, or into service industry work which had to compete with undocumented workers and employers happy to engage in wage frauds. This set up a winner/loser situation that the winners then turned into an excuse to become abusive of their former classmates.

    I don’t know if there is a moral to this story. But I think we are now a nation overrun with glib know-nothings, spoiled jocks and professional hand-wringers. I don’t know how that plays out, but it doesn’t sound like something that is going to continue for too much longer.

    1. NOTaREALmerican

      Re: I don’t know if there is a moral to this story.

      The stigma of “shop class” was present with I was in High School. (I’m mid fifties, that was the last 60′s)

      A huge difference between Europe and America is how the society “view” it’s average workers. The peasants themselves allowed unions to be destroyed because of how “union jobs” were view by the peasantry. American peasants are self-loathing (to some extent).

  28. Sunny

    ‘golden rule’ is reigning and Employers are using it to their maximum benefit, irrespective of all the logic, rationale arguments you can throw at them.

    Come Nov, the same gullible ‘average Joe/Jane’ will vote for Tea Party candidates for a ‘change’ and they will get the same or more likely worse than like last Nov election.

    The ‘Change we can believe in’ doesn’t exist in either parties! They are all the same ‘Repocrats’ with the same agenda – Elected and get re-elected!

  29. JenJen

    Slight nitpick… as a Food & Beverage pro who is also having a hard time finding servers to staff our restaurant, I’d quibble with the reasons given in the Journal piece. First of all, it’s laughable to think that servers or bartenders are by definition “unskilled.” It’s even more laughable to suggest they are “low-paid.” The reason we’re having a difficult time finding wait staff is because our applicants don’t have any damned experience, and can become a little hostile when we suggest to them in interviews that they’re not qualified for the job.

    If anything, since unemployment has been high in the last few years, we’re getting a glut of former mid-level managers and factory workers applying for wait staff jobs, and we’re not looking to train anybody to do this kind of work. We need wait staff that can hit the dining room running on Day One. It takes a great deal of patience, hustle and organization to be an effective server, all the while keeping a smile on your face as pressure mounts between your guests and the chefs in the back. It’s a delicate balancing job. It’s far more difficult than it looks. And the wait staff that truly excels at their work? They’re far from low-paid. In fact, the best servers in my city aren’t looking for employment because they’re already making plenty of money in good conditions at their current restaurant, hotel or tavern.

    1. AvgGuy

      So basically you are the employer who needs employees but doesn’t want to take the time and expense to train.

      Oh yeah, you’re not part of the problem.

      Waiting tables is hard work, but it’s not open heart surgery.

  30. Ann K.

    I’m a product of the skills and experiences that I obtained over my 25-year working career. In some instances I was blessed to gain skills in certain key areas, where in other instances I was denied certain opportunities that would have helped me pad out my resume, simply because my wishes didn’t match up with company needs. I don’t feel bitter about that at all because I was always willing to do whatever it took to help the companies achieve their goals.

    As far as company executives moaning about workers being unwilling to relocate, there are very few jobs in the country that “perfectly” match up with my unique work history. It takes a giant leap of faith to fly out to an unfamiliar part of the country and interview for a job that I’m not really qualified for, then think I can convince the hiring managers that I can save the company $1 million and bring in $1 million in additional revenue in my first year on the job.

    As far as training, the family patriarch on my husband’s side of the family gave a bunch of us a big pontifical speech about how he moved his family to three different parts of the U.S. during the recession days of the early 1960′s. The obvious implication was that the unemployed among us should load up our Conestogas and seek our fortunes. The irony was completely lost on him as he kept EMPHASIZING how he took advantage of the excellent training programs that were offered at all three of the companies he worked for.

  31. MKS

    Two steps towards a solution:

    1)Term Limits – Make politicians to be less worthwhile as investments, since they can’t be in office for long.

    2)Fair Tax – Make a simple tax code with no loopholes, so politicians have fewer favors to bestow.

    The big-government-big-business alliance, which is bolstered by regulation, taxation, and executive order, needs some of its steam let out. When small businesses find themselves in a friendlier environment, jobs will proliferate.

    1. NOTaREALmerican

      Re: Make politicians to be less worthwhile as investments

      Hasn’t worked at ALL in CaLi. If I’m a wealthy person and want to own a politician or two I really don’t care what the politician’s shelf-life is.

      The problem, however, is identified in your statement: “less worthwhile as investments”. When Americans bought into the concept of pay-to-play in politics as the unquestioned normal way the system works, that was the end of “democracy”.

      Many peasants I know think that as the wealthy are more-worthy as citizens than “the peasants” (the wealthy being the definition of successful) then – it follows that – the wealthy deserve more influence over political decisions. After all, as long as the peasants get to vote we still have democracy, right?

    2. Fred Fnord

      1) People pay for politicians in installments. So it costs the same to buy Fred and George as it does to buy Fred for two terms. And shorter terms mean that George doesn’t know what he’s doing… he’s much easier for the powerful to take advantage of. Yeah. Great idea.

      2) “The Fair Tax”. If you can still say that name with a straight face, you make over $150k a year and hate the little people. It is literally impossible to have gotten this far and still take that pile of crap seriously without those two characteristics and yet be able to post coherent sentences on a blog.

    3. PQS

      “The big-government-big-business alliance, which is bolstered by regulation, taxation, and executive order, needs some of its steam let out. When small businesses find themselves in a friendlier environment, jobs will proliferate.”

      Funny, outside of the RW Talking Point Universe, I’ve yet to hear a single small business person say that to me in any of the many interviews I’ve been on. Or at any of the lunches I’ve attended with them. Here’s what we’re hearing out in the Real World:

      1. If Wall Street and the Banksters would LOAN SOME MONEY, we could all get to work.
      2. See No. 1.

  32. Eff

    The social-compact is broken.

    Corporate globalisation attended to render that dysfunction.

    Read: Banks, Red-Shield.

  33. threadkilla

    “industrial hygienist job paying as much as $47,000 a year, which requires special certifications and expertise to oversee projects such as asbestos cleanups”

    sorry to say but that sounds like shit money for the job title.

  34. Julie

    A relative of mine actually did live on unemployment for several months rather than take a crappy job, but he had advantages most people don’t: both house and cars paid off, a wife with a decent-paying job, no kids.

    He was working for a refinery contractor building scaffolds (dangerous work) for $14/hr. This was a contractor nobody liked working for, nepotistic, exploitative, etc. He was doing his foreman’s (a “family” guy) job when they decided to lay off all but one guy on his crew, leaving not enough people to do the job well or safely, so he basically said “FU, I’m leaving too.” He was able to collect UI even though he quit because he was being asked to do a job that was above his pay grade in an unsafe manner. This was in a rural area with not many job prospects, so he wasn’t able to go to a competitor.

    Several times over the ensuing months, this company tried to hire him back. Instead, he painted and put a new roof on his house and did a lot of other things he’d been putting off. In the meantime, the contractor he’d worked for got “fired” by refinery management (too many accidents).

    Just when his UI was about to run out, the new contractor called and he went back to doing his old job as a carpenter, this time for $17/hr. When they learned he could “pull permits”, they made him a foreman at $20/hr. So now he’s in a job he likes, making a lot more money.

    So was he shiftless, or shrewd? It seems to me the answer is only dependent on which side of the labor/capital divide you fall on. On the one hand, UI allowed him to be “picky”, but it also prevented him from being exploited in an unsafe job for unfair pay.

    1. Ivan Karamazov

      I work in a body shop.

      A coworker of mine (his politics are far more conservative than mine, but he’s an all-around nice guy) recently told me that he’s thinking about quitting his current job. Then he can draw unemployment, work out of his garage for cash, and make more money than he is now.

      Apart from the cognitive dissonance between this idea and his own political rhetoric: shiftless or shrewd?

  35. sgt_doom

    About ten or so years ago I stopped reading and viewing all of the American-Non-media as anything approaching an actual media ceased to exist long ago.

    Such mindless drivel as that article (not Yves’ comments) are the primary reason. They don’t reflect my, nor anyone else’s, reality.

    Simpleton propaganda…aimed at simpletons!

    I read the foreign and international news, where I find more actual, and factual, stories on the USA. And I read very enlightening government documents which contain data which NEVER reflects on what is reported about those govt. documents and reports.

    I recall the last fantasy article I read years ago in the NY Times Sunday Magazine: about dot.com and high tech execs at a seminar where the seminar clown reported easy profits with the web — just download all the software and save on distribution costs (I’m not going to elaborate on the idiocy of that thinking!)

    And I read every GAO report that comes out.

    But not the American-Non-Media. Pure claptrap….

  36. bandit

    I changed jobs recently and was asked twice in the interview if I was currently working, which I was. Amazing how many commentators think that private businesses owe them or anyone else a living. Maybe that helps explain why it’s so hard to fill jobs?

    1. Francois T

      “Amazing how many commentators think that private businesses owe them or anyone else a living.”

      Go ahead! Source these comments if you can. Discuss where it is written or implied “that they’re owed a living”.

      Be specific!

    2. Ivan Karamazov

      If a sufficiently large portion of the population is unable to make a decent living (food, shelter, children, enough entertainment to make life worth living) by the normal methods condoned by society, they will reach outside those ‘normal’ methods. In other words: illegal and almost always violent. Look at northern Mexico.

      “Sure, that guy has a Kalashnikov and a few kilos of meth in his trunk! Boy, is he really pulling himself up by his bootstraps!”

  37. eric anderson

    I recently read a laughable headline in the Des Moines Register about the decline of corn detasseling. Seed companies are looking to newer self-pollinating varieties, because of a shortage of workers to do the detasseling manually — that was part of the headline. This in a time of massive teen and young adult employment.

    I detasseled corn in 90 degree plus heat. Many of my classmates worked on detasseling crews, or subcontracted their own plots to work on.

    We have a large working population that is loath to work, if any difficulty is involved. Of course unending unemployment compensation and (in the case of teens) indulgent parents contribute to this reluctance. This is common sense. It is also demonstrable reality.

    1. Jojo

      eric anderson said “Of course unending unemployment compensation and (in the case of teens) indulgent parents contribute to this reluctance. This is common sense. It is also demonstrable reality.”
      ——–
      Perhaps you missed that old quote that “common sense is not so common”?

      Too many people, like yourself in this case, try to oversimplify an issue or try to impose their own logic (“common sense” in this case) on other people. Your biased personal view of the world is not necessarily the same as what everyone else holds ) or should hold).

      1. eric anderson

        What I’m trying to get you to understand is the facts.

        There are huge numbers of those wanting jobs.

        There are employers wanting for jobs.

        Whatever the reason, the inescapable conclusion is that the unemployed do not want sufficiently to be imployed to accept the available jobs. You could produce a long essay with some esoteric and complicated explanation to reconcile these two facts. Or, you could just apply Occam’s Razor. Your choice.

  38. cycy

    I am in a fairly rare field and floated my resume about this Spring just to see what happened. I got tons of calls and one bite from a big player in my field. It could be termed a dream opportunity, however it was in DC and they wanted to pay me 15,000 more than I currently make. I’m sure they realized my current salary is low but I also live in one of the lowest cost of living areas in the country. I have a pension. My current job is very nice.

    They were shocked when I turned down an offer to go meet with them. I told them in the first call what my salary requirements were. They offered me a job making 25,000 less than a three letter organization offers off the bat. When a big three firm lowballs you in one of the highest cost of living areas, they can’t expect much.

    I was assured that I could work all the paid over time I wanted. That’s very nice of them, but when I end up with more disposable income in my current job, with a pension, what is my motivation? I don’t want to work an additional 30 hours a week just to pay rent. Employers think everyone is desperate for a job and are bargain shopping.

    My current boss told me I was lucky to have a job, which is another refrain my friends are hearing. No, I’m not lucky. I work hard, do my job exceedingly well, and someone will hire me because I work my ass off to constantly stay ahead of the curve in my field. Employer’s mind set is that they are generous for “giving” us a job.

    Whatever. I feel for the people who need jobs but can’t find one.

    1. anonymous

      Very sensible. I belong to a union in a company that routinely violates labor laws, especially with non-union employees. (unpaid overtime is the most common offense)

      The hiring practices of the firms you describe are essentially coercive. I’ve always felt that if we perform in the top third of any group, than we have little to fear. If we face pressures from the firm and we’re still doing our jobs well, it’s safe to say that the problem is them, not us.

      We may see a return to consumer purchasing associations in the near future. Certainly social media has been under-utilized as a tool to force companies to conduct business fairly.

      Our union committed to good faith practices following a very brief worker action last year. We did so for two reasons: first, because we believe that acrimony isn’t going to make the work environment better. Second, this pro-company position provides us with maximum leverage for negotiations in the new year.

      If workers want better rights, better conditions, and better contracts, they’re going to have to organize. Otherwise corporations will continue to try to steal from their employees. The government is unlikely to provide any help.

      The cavalry isn’t coming.

  39. Hayduke

    The other questionable article in the WSJ, “Why I’m not Hiring” by Michael P. Fleischer, is Ari Fleischer’s brother,the former press secretary for George W. Bush. No where in the article does it mention this connection. Nor does it mention that he took a leave of absence to assist in the privatization of Iraqi public assets. Think Shock Doctrine. Must be nice to have government contacts!

    So the WSJ ran a rightwing rant under the guise of a legitimate businessman with a legitimate beef. Yeah, shocking, I know. But that’s what the WSJ has become…a propoganda arm.

    (MP over at calculatedrisk comments uncovered this nugget)

  40. Francois T

    My father owned a big retail pharmacy in Canada. Every time, he would come back from meetings of his trade association telling us about colleagues who would complain how difficult it is to retain their best employees, while, in the same breath, complaining that they had to pay above minimum wage!

    Talk about cognitive dissonance!

  41. Francois T

    Reading through the comments, I realize there is a yet under recognized phenomenon at play here; I call it the moronization of employers.

    What I mean by that is there has been a trend at the top of multiple corporations; a shift from people in the trenches who climbed to the top to financiers and MBAs running the show.

    It should be obvious to anyone who works in a specialized field that those who graduated from the trenches are aware of what the employees need to function, be productive and willing to stay; they also know what their company needs to stay competitive and profitable. After all, they know the field and are certainly not imbued of theories that a diploma in management gives you the skills to manage anything, just because.

    Yet, those who come from the world of finance and management schools tend to strongly believe it. Be it drug manufacturers, device manufacturers, insurance companies, healthcare informatics and what have you, the list of repeated failures (not demises) is getting longer and longer.

    http://hcrenewal.blogspot.com/2010/08/ge-dont-know-much-about-radiation.html

    (Tons of links to rather juicy stories)

    And the link above is just about health care. I shudder to imagine what it must be elsewhere.

    1. Attitude_Check

      What you describe is a BIG problem in the Aerospace industry also. The folks in charge do not have sufficient domain knowledge to understand the impacts of their decisions

  42. Ray Phenicie

    I see the WSJ article as another variation of the same old song American Business, with much help from our venerable Journal, has been singing for so long: ‘If Only Good Workers Would Strap Themselves in with the Protestant Work Ethic.’

    Which is a variation on an aria from another Opera entitled “Enduring Slavery in the American Factory System.”

    Which aria contains themes reminiscent of a tune from the Rock Musical entitled
    “Unplugging from the Grid”

    Which has epic themes borrowed from the Medieval Morality play entitled
    “Bowing to Ba‘al Zebûb”

    Always the same theme is being harped on but should be deconstructed as
    “We’re too stupid as entrepreneurs to learn how to design a highly productive factory system so we’ll blame it on the ignorant workers.”

    “We don’t really care to learn about how to make quality goods so we’ll get our investors to back us in building factories overseas and let the heat about quality, the environment and every other ‘externalization’ we can dream up flow over there”

    “We can’t seem to tap into the most highly developed technology grid the world has known because we just learned how to run our fax machine yesterday”

  43. RueTheDay

    “If the job market were working normally—that is, if openings were getting filled as they usually do—the U.S. should have about five million more gainfully employed people than it does, estimates David Altig, research director at the Federal Reserve Bank of Atlanta. That would correspond to an unemployment rate of 6.8%, instead of 9.5%.”

    Something doesn’t add up.

    All the data I’ve seen indicate that there are currently approximately 5 unemployed workers for every job opening.

  44. MedInformaticsMD

    And with that came a major shift in behavior: it made less and less sense for employers to hire talented people with good general competence and character and train them.

    This only made “less sense” to morons.

    Now companies and the country is reaping the rewards of putting losers in charge. The chickens have come home to roost.

  45. Tyler Elliott

    Good post. When fiscal conservatives talk about a recession ‘correcting’ itself, it means in plainspeak, that people will lose their jobs at X per hour.. and then be rehired at 20-40% less. The businesses will have an opportunity through the $$ saved on salary and benefits to replenish their profits and the newly re-hired employees are expected to be grateful.

    No self respecting person with half a brain would accept a job at lower salary than what he/she is receiving in unemployment, which in itself is quite paltry.

  46. babyspikes

    I’m wondering why nobody has stated the obvious: When companies focus on hiring “qualified” workers, they block people from entering these fields, sowing the seeds of their own destruction. It’s not that young people aren’t interested in these fields, they just can’t get any entry level jobs in them.

    This started about 10-20 yrs ago(hit the floor running). When entry level jobs and otj training no longer exists, new workers are effectively barred from entering the field. The only “qualified” workers are the ones lucky enough to get a foot in the door before these draconian policies took effect.

    These qualified workers basically play a game of musical chairs by being recycled and shuffled from company to company, while their numbers dwindle from leaving the labor force one by one. Once the level of these “qualified” workers drop below the level needed to sustain their shuffling between companies, entire industries start to collapse from greed and stupidity.

    Don’t blame china or mexico, blame your next door neighbor!

  47. getaclue

    The plan to create a global plantation where workers labor in exchange for mere room and board (you have to feed them, I guess) continues apace.

    By the end of 2013 there will be no more wages anywhere in the world.

  48. Milan Moravec

    The liability of traditional employee loyalty: recruitment! Public and private organizations are into a phase of creative disassembly where constant reinvention and adjustments are constant. Hundreds of thousands of jobs are being shed by Chevron, Sam’s Club, Wells Fargo Bank, HP, Starbucks etc. and the state, counties and cities. Even solid world class institutions like the University of California Berkeley under the leadership of Chancellor Birgeneau & Provost Breslauer are firing staff, faculty and part-time lecturers. Estimates are that the State of California may jettison 47,000 positions.
    Yet many employees, professionals and faculty cling to old assumptions about one of the most critical relationship of all: the implied, unwritten contract between employer and employee.
    Until recently, loyalty was the cornerstone of that relationship. Employers promised job security and a steady progress up the hierarchy in return for employees fitting in, performing in prescribed ways and sticking around. Longevity was a sign of employeer-employee relations; turnover was a sign of dysfunction. None of these assumptions apply today. Organizations can no longer guarantee employment and lifetime careers, even if they want to.
    Organizations that paralyzed themselves with an attachment to “success brings success’ rather than “success brings failure’ are now forced to break the implied contract with employees – a contract nurtured by management that the future can be controlled.
    Jettisoned employees are finding that the hard won knowledge, skills and capabilities earned while being loyal are no longer valuable in the employment market place.
    What kind of a contract can employers and employees make with each other? The central idea is both simple and powerful: the job or position is a shared situation. Employers and employees face market and financial conditions together, and the longevity of the partnership depends on how well the for-profit or not-for-profit continues to meet the needs of customers and constituencies. Neither employer nor employee has a future obligation to the other. Organizations train people. Employees develop the kind of security they really need – skills, knowledge and capabilities that enhance future employability.
    The partnership can be dissolved without either party considering the other a traitor. Employee loyalty to management is dead. A Rx for employee loyalty reform

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