Unemployment is Up! But So are Job Vacancies?
Decatur Metro | September 10, 2010It’s pretty interesting how tightly we focus on the unemployment rate during a recession, but rarely hear anything about weird discrepancies like this. From a recent David Brooks piece in the NY Times…
One of the perversities of this recession is that as the unemployment rate has risen, the job vacancy rate has risen, too. Manufacturing firms can’t find skilled machinists. Narayana Kocherlakota of the Minneapolis Federal Reserve Bank calculates that if we had a normal match between the skills workers possess and the skills employers require, then the unemployment rate would be 6.5 percent, not 9.6 percent.
There are several factors contributing to this mismatch (people are finding it hard to sell their homes and move to new opportunities), but one problem is that we have too many mortgage brokers and not enough mechanics.
There’s an intriguing new off-shoot of the perhaps-too-simply-defined “sustainability movement” that’s reexamining the craftsman blue collar life – beyond farming – as an alternative to the celebrated, yet disconnected white collar alternative. Working with your hands, performing complex problem-solving, having tangible results of your work, etc. Matthew Crawford’s Shop Class as Soulcraft uses motorcycle repair as his real-life example of this.
Welp, if you buy into it, it sounds like there are plenty of job opportunities out there for you!
Decatur High School’s Career Academy can’t come soon enough.
There’s an intriguing new off-shoot of the perhaps-too-simply-defined “sustainability movement” that’s reexamining the craftsman blue collar life – beyond farming – as an alternative to the celebrated, yet disconnected white collar alternative.
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More power to it, though I am not sure what it has to do with sustainability. We simply have too many people pursuing “white collar” careers. Far too many people are pushed towards a 4 year degree, when they’d do far better to skip college and embark on a “blue collar” careeer. There is nothing remotely dishonorable or second-class about working with your hands.
The near universal push towards college for everyone has not only caused a relative shortage of machinists, etc., but has driven college costs through the roof for decades. College isn’t for eveyone even if it is free. It’s far less attractive when it saddles a graduate with tens of thousdands in student loan debt. Here’s to more debt-free plumbers and fewer debt-ridden lawyers and liberal arts majors.
Well, I guess if you don’t take a purely environmental view of the word “sustainability”, the idea of encouraging people to pursue more rewarding “blue collar” careers is sustainable in from the financial standpoint, of which you describe. Also, these types of tactile jobs are essential in self-sustaining local communities.
I agree it’s not an obvious leap, but I think the appearance of these types of books on the “sustainability” shelves in bookstores shows that the idea of “sustainability” has been co-opted by various pro/con factions and forced into the box of “environmentalism”, when in fact it’s a much broader initiative, which crosses party lines.
Here is a fantastic article on the “Prestige” racket infecting colleges everywhere:
http://www.washingtonmonthly.com/college_guide/feature/the_prestige_racket.php
And another one about the loan racket:
http://www.washingtonmonthly.com/features/2009/0911.burd.html
The question is, when will the “college loan bubble” burst?
Take it from somebody that teaches at a technical college, out there in the trenches of “upgrading skills for the global economy”, skilled machinists cost much more time and money than David Brooks appreciates. Our program required a full time commitment for a year and a half to get through the basic traditional machinist training. That’s enough for an entry level job on old style machines. And people do get hired for those jobs — usually working about 60 hours a week .
If you want to be up to date on the latest machines you have to then start training on CNC machines, which suddenly requires computer programming skills. At that stage you pretty much have to be somebody with the conceptual capacity that you could have been mortgage broker with a 4 year degree had you chosen that path.
Look at the adds on craigslist — they all want machinists with 5 years experience. So at least three years of full time training and you end up with a 2 year diploma plus a Technical Certificate. They still won’t hire you for a livable wage because they don’t want to pay for the inevitable mistakes you will make while you gain experience. And who’s your boss? A guy who did go to 4 years of college and sits in an air conditioned office all day pushing a mouse.
But in reality students that can handle CNC programming are not flocking to technical schools. The bulk of students are either foreign and struggling mightily to learn the language or they are Americans that drifted through school from the time they were kids and cannot read for content. If you can handle CNC you might as well go to engineering school.
And for the record, the guy that wrote “Shop Class as Soul Craft” works on ancient bikes for collectors — a small niche that pays higher than average. Still, there are lots of jobs out there for mechanics so I’m not bashing that.
Many fond memories of working with machinists when I was a know-nothing engineer. Was fortunate to work in a plant where there was a good degree of mutual respect between the machinists on the floor and the front office. I think it was because the managers/engineers understood how much they depended on the machinists to make the ideas work. Sure, you had your normal b*ching about overly complex designs or prototypes out of spec, etc. but that was minimal.
Best part of the job was getting out on the floor to ask/see if/how a machinist might make a part – and have them bark at me when they were setting up. (I’ll never forget the time I asked a machinist to turn a piece of hard plastic in a machine meant for high quality steel! :0) Engineering school taught me concepts and equations, but really the machinists taught me to “engineer”.
– Guy who sits in an airconditioned office and pushes a mouse (but still respects the plant floor).
I met a guy recently that machines for physics professors at Tech. He has some great stories to tell. Sounds like engineers have their feet planted deep in the soil compared to quantum mechanics. (mechanicists, machinists, mechanizers?)
Agree completely that blue collar work is beyond honorable and needed. All of the men two generations before mine were blue collar workers who also held civic leadership positions and were great role models. However, you have to be careful. Certain blue collar jobs have disappeared or will soon including auto worker, newspaper or magazine worker, many construction related jobs, real estate agent, and secretary.
Hmmmm. Now real estate agents, newspaper and magazine workers are blue collar? It’s not blue vs white collar it is keeping up with the times. I’ve never met a real estate agent who wasn’t something else first. That’s the beauty of selling real estate–you don’t sell real estate, you manage people. And that skill will always be in demand. Um…print publicatons…they are and will continue to come back. Bottom line, look for the trends and go with the flow. Isn’t that what a good liberal arts college education teaches?
karass says:
September 10, 2010 at 1:42 pm
Agree completely that blue collar work is beyond honorable and needed. All of the men two generations before mine were blue collar workers who also held civic leadership positions and were great role models. However, you have to be careful. Certain blue collar jobs have disappeared or will soon including auto worker, newspaper or magazine worker, many construction related jobs, real estate agent, and secretary.
R-e-s-p-e-c-t. Every worker wants it. Do mechanics get it from their corporate managers?
In every office I’ve been in, and that includes most of the large Fortune 500 companies in America, the suit and tie folks treat all the blue collar folks like bugs. Not surprising that most kids would want to work in the more comfortable front office than back in the plant.
You have been in the offices of at least 251 of the Fortune 500 companies? Must have taken quite a while to do that.
Andy Grove touched on this in a recent Business Week column about outsourcing production. He noted that the US outsourced the production of lithium batteries, and eventually the critical mass of technical knowledge of battery production in other countries fueled their ability to drive their own innovations. Now US companies are trying to develop hybrid/electric vehicles, and we don’t have the knowledge base that other countries do in this area.
Grove quote:
“As happened with batteries, abandoning today’s ‘commodity’ manufacturing can lock you out of tomorrow’s emerging industry.”
What’s Grove’s suggestion for a solution? Government subsidies for manufacturing? People howled when the US bailed out GM and Chrysler, not to mention the banks.
Meanwhile China can take the trillions of dollars it has in trade surplus and build new industries from the ground up, however they see fit, with the expectation of losses for years to come. As Tom Freidman says in the NYTimes:
” That one party can just impose the politically difficult but critically important policies needed to move a society forward in the 21st century. It is not an accident that China is committed to overtaking us in electric cars, solar power, energy efficiency, batteries, nuclear power, and wind power.”
There have been several articles recently about China giving free real estate and other benefits to renewable energy companies while US manufacturers can’t borrow money for expansion from anybody even though we still hold a technological edge. Today United Steelworkers filed a suit in the WTO against China for unfairly subsidizing wind energy companies that export towers.
The thing about outsourcing is that you have to do it if you are an American manufacturer. There’s just no choice. We have a system designed to wring out inefficiency. We won’t be as efficient as the Chinese until our wages equalize.
The US populace has become so under educated and intellectually lazy that they can’t pay attention to anything but the most simplistic political and economic blather. So we refuse to do anything expensive, difficult and long term, other than fight wars and police the world.
We are TOAST. It is only a matter of time before we are the second largest economy.
“The US populace has become so under educated and intellectually lazy that they can’t pay attention to anything but the most simplistic political and economic blather. So we refuse to do anything expensive, difficult and long term, other than fight wars and police the world.”
But we do know who won American idol last night.
Off topic (by a long way), but if you’re the same Uncle Charlie; I will never, I swear, never pull your finger again.
So we refuse to do anything expensive, difficult and long term, other than fight wars and police the world.
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I dunno, I thought the $800 billion stimulus was kind of expensive. Ditto the $900 billion health care overhaul. Not long before, we passed the $750 billion TARP fiasco. Which itself followed Bush’s earlier $150 billion “stimulus.” Oh, we also passed a $50 billion bail out of state budgets a few months ago.
Perhaps you think all of these were lousy policy (and I’d agree). But cheap, they were not. And some were dreamed up by the reported uber-genuius economists in the Obama administration. I don’t happen to agree with them, but I wouldn’t call them under-educated and lazy.
Exactly my point. Most of your examples are expensive but they are not difficult, long term policy. They are short term reactions to crisis. They are not decisions to accept some responsibility and sacrifice to pay for our lifestyles.
Why did the crisis come about? We accepted a simplistic rationale for deregulation, (the market will police itself,) and let the bankers run amok so they could drown themselves in short term profit. Now nobody wants to accept that we all lived beyond our means and we can’t, as a nation, pay back our debts.
Health care reform is a whole nother thing. It’s not the bill I would have liked but at least it starts to deal with the fact that you can’t treat access to care as a given if thirty percent of the populace don’t pay into the insurance pool.
I’d vote for a push for some basic economics in high school, or at least some discussion about opportunity costs. I’ve read some pretty compelling arguments that link the rising cost of college to the availability of cheap loans (the same easy money policies that fed the housing bubble). Just as not everyone SHOULD be a home owner, not everyone should go to college.
The same long term, short-sighted thinking from the federal government to encourage things that on the surface sound like great ideas (increased home ownership, more higher college enrollments) has led to the dearth of skilled blue-collar workers.
If we’d stop spending money to try to encourage specific outcomes, we’d have a lot more leverage in trade negotiations with China. The fact that we NEED them to buy our debt makes it all but impossible to insist on fair, free trade.
They are short term reactions to crisis. They are not decisions to accept some responsibility and sacrifice to pay for our lifestyles.
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I can’t disagree with this. A recession simply HAS to follow a debt-fueled consumption binge of the likes we saw. But very few will admit this, and certainly no pol of either party. Instead we’re told that we can borrow our way out of this by borrowing even more (by the government).
Of course a recession was inevitable. But government spending is the only proven way to shorten, or lessen the depth of, a recession. Without that spending we would have had most of our largest banks and pension funds fail.
On the same Friday as David Brooks’ article there’s a piece on the opposite side of the same page by Paul Krugman about Japan’s problems trying to recover from a real estate bubble in the 1990s. The gist of it is that they spent enough to keep themselves out of depression but not enough to avoid deflation. So almost twenty years later deflation has become the norm and they are stuck with slow growth and fairly high unemployment.
This is where we are headed — not into utter disaster but get used to flat wages, impoverished retirements and declining standards of living for the middle class. The best thing about being a craftsman is your sense of pride in the work but you have to accept a lower wage along with that.
But what about all those 8% yearly growth models that are my only shot at retirement?
I’m beginning to think that retirement is going to be a thing of the past quite soon.
Now who’s the entitled generation? Hmmm baby boomers? Hmmm?
Government spending is not pretty (TARP,Stimulus, cash for clunkers, etc) but if you recall close to no one was investing or consuming and if I remember my Macro Economics correctly, the economy is equated with GNP and GNP equals Consumption plus Investment plus Government. What choice did we have but to have G infuse huge amounts of money to offset what clearly was a near collapse of the system. Sure we could have weathered it and the economy would have adjusted eventually but the cost would have been far beyond the recession we see now.
Rather than focus on Grove’s solution, I thought I would contribute to DM’s point by outlining the problem that he wrote about. I think it’s a good point – sustainability of certain occupations or economic sectors is largely a matter of critical mass.
As for what to do about it – my thinking is we need to actively intervene in currency markets to devalue our currency vs. China’s. Two can play that game. Sure, their country and society would melt down within months, but that’s going to be the end game for them whether we bring it or not.
If we were to take on China’s currency peg, we would solve THE numero uno imbalance in our domestic and the world economy – and things would start to heal.
Illegal immigration has consequences.
Dude, we are all illegal immigrants–folks need to let it go; unless, of course, by immigrants you mean people from Canada and Europe as well as Asia and Mexico.
If it’s possible to convey the smell of ‘hippy’ across the blogosphere, then all I can say is ‘ Well done sir…well done’.
Phew wee! What’s that stink blocking the sweet patchouli scent?