US: Too Many Jobs; Not Enough Workers

US Labour Shortages Intensify Across All Sectors

For all areas of the US economy — from small businesses to giant corporations — a growing shortage of workers is beginning to be felt. The unemployed labour pool (6 million) is now smaller than the number of job openings (6.7 million), and the gap is only growing wider as the Trump reforms to the US economy begin to have an impact.

Truck drivers are in perilously low supply, Silicon Valley continues to struggle to fill vacancies, and employers across the grid are coping with a skills mismatch as the economy edges ever closer to full employment.

“Business’ number one problem is finding qualified workers. At the current pace of job growth, if sustained, this problem is set to get much worse,” Mark Zandi, chief economist at Moody’s Analytics, said in a statement. “These labor shortages will only intensify across all industries and company sizes.”

__ Source

The Problem is Greatest for Skilled Jobs

Skilled trade workers average near 55 years in age, and as the baby boomers retire, so do the skilled workers — and they are not being replaced. Why not? According to “Dirty Jobs” TV personality Mike Rowe:

• High school curriculum: Most U.S. high schools have eliminated shop classes and other vocational training opportunities, as budget cuts claimed a traditional pathway into a career in the trades.

• College vs. the trades: In many cases, students are counseled that going to college (and often taking on thousands of dollars of debt) is the only way to become successful, despite the fact that there is a surplus of solid, good-paying career opportunities in the trades that do not require a bachelor’s degree.

• Family businesses: Many trades contractors are family businesses, in which the next generation may not want to continue the tradition.

… Today’s students are given the idea that obtaining four-year college degree is the only path to success, despite the fact that there are millions of good job openings that do not require a degree. “You have to make (skilled trades work) aspirational,” said Rowe. “You have to change the image of the opportunity.”

• Training programs: More training programs are needed for the next generation of electricians, plumbers and HVAC technicians. __ Skilled Labour Shortage

Food and Hospitality Services Also Hard-Hit

More people are employed, and eating out. But where are the food service workers?

A tight labor market and an explosion of new restaurants have made finding and keeping help ever more difficult across the country.

In 2017, the National Restaurant Association reports, 37 percent of its members said labor recruitment was their top challenge, up from 15 percent two years ago. With low profit margins leaving little room to do what most businesses do in tight labor markets — increase wages — restaurant owners are having to find other ways to attract and hold onto workers.

… “Everybody eats out,” said Gerri Mason Hall, the head of human resources at Sodexo in North America, the giant food service company and cafeteria operator, which also vies for restaurant workers. “We are competing for executive chefs, front line cooks, the entire talent pool.”

… Restaurant industry experts say the recent crackdown on undocumented workers has sent a further chill through the business. Dishwashers and other low-wage restaurant workers have long been recruited from the nation’s undocumented work force, but many restaurateurs are wary now of going to that well. __ New York Times

Blame Trump for scaring the undocumented restaurant workers away, but also give him credit for boosting the underlying economic activity that is pushing the greater demand for services.

Skills shortages in the oil industry include shortages of engineers, welders, rig workers, and on and on and on . . . Similar skills shortages in construction, manufacturing, health care, transportation, utilities, etc. etc.

The fierce competition for hiring has led to both a drop in the unemployment rate and a rebound in the prime-age employment-to-population ratio in Iowa. It has also raised the specter of labor shortages, with businesses simply unable to find experienced workers to fill their positions. “There are not a lot of welders sitting around looking for work. The construction trades, the roofers, the framers, the dry-wallers,” said Dan Culhane, the president of the Ames Chamber of Commerce. “Those are [workforce] challenges that Ames and Story County and Des Moines face.” __ https://www.theatlantic.com/business/archive/2018/07/hello-full-employment/564527/?utm_source=feed

More on Retiring Baby Boomers

The US is not the only country that is losing skilled workers and gaining huge numbers of retirees. In fact, most developed nations are worse off in that regard than the US:

One reason the U.S. is in better shape is its comparatively high rate of immigration. Since people tend to migrate when they are younger, immigrants tend to bring down the age of the population as a whole…

The U.S. also has another trend working in its favor: Baby boomers are retiring just as their children — sometimes known as the “echo boomers” — are entering their prime working years. Boomers are no longer even the largest age cohort; more of today’s Americans were born in the 1980s and 1990s than in the postwar years. As today’s teens and 20-somethings enter the workforce, they will partly offset their parents’ exit. __ Source

Under Obama, Millions Gave Up Looking for Jobs

The US Obama administration seemed custom-made to sabotage the US economy and US industry. Millions of workers abandoned the search for work, discouraged by the pessimism across the economic sectors.

Under Trump, the opposite problem is emerging. Too many jobs and not enough workers will lead to a certain amount of wage inflation as employers are forced to bid for new workers against all other potential employers. Wage inflation will lead to higher prices for goods, and then interest rates will slowly rise to compensate. It is the typical business cycle in a capitalist economy.

The greatest challenge for Trump’s “Make America Great Again” crusade is to contain and reduce government spending, regulation, legislation, judicial activism, and taxation to levels that will not bring back the damaging malaise and pessimism that narrowed US economic horizons in the 70s under Jimmy Carter and in the 2008-2016 span under Obama.

Trump only has a few years to try to reverse many decades of engineered decline.

Hope for the best. Prepare for the worst. It is never too late to have a Dangerous Childhood © .

For some excellent thoughts on the liberating psychology of working with one’s hands, see Matthew Crawford’s “Shop Class as Soulcraft” and other writings.

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This entry was posted in Competence, Donald Trump, Economics and tagged , . Bookmark the permalink.

5 Responses to US: Too Many Jobs; Not Enough Workers

  1. Cecil Henry says:

    “Wages in rich countries are determined more by immigration control than anything else, including any minimum wage legislation.

    How is the immigration maximum determined? Not by the ‘free’ labour market, which, if left alone, will end up replacing 80–90 per cent of native workers with cheaper, and often more productive, immigrants. Immigration is largely settled by politics. So, if you have any residual doubt about the massive role that the government plays in the economy’s free market, then pause to reflect that all our wages are, at root, politically determined.”

    Chang, Ha-Joon. 2011. 23 Things they Don’t Tell you about Capitalism, Thing 1: There is no such thing as a free market

    Admin: Thanks for this non sequitur of a “dogma for the day.” Try to stay on topic in comments and avoid tangents.

    • Someone says:

      “cheaper, and often more productive, immigrants.” :LOL: Give me a break! Some of these people are worthless and lazy as well, but corporate Amerika likes ‘duh-versity’ no matter the financial costs.

  2. JerryO says:

    Informative post, as always…

  3. Someone says:

    If this post is accurate, why are there so many engineers out of work? Oh wait, they are white males and actually want to be paid something for their skills and ability.

    • alfin2101 says:

      I can’t speak for “so many engineers” that are “out of work,” but I suspect that if many of them had been taught from childhood not to depend on someone else to give them a job, that at least some of them would indeed be working right now. Society and the educational system teaches kids to expect to “merge with the system like a slime mold” as their prime destiny in life. That may not be the best approach in a radically changing world.

      Sure, not all kids can be billionaire whiz kids like Bill Gates or Elon Musk — but they don’t need to be. They only need to somehow escape the groupthink indoctrination that strips them of their imaginations and their vision. The unkindest cut of all is the one we give ourselves, when we willingly take on the role of victims.

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