Labor Shortages: Myth and Reality - BusinessWeek

[sinkingfeeling]

http://biz.yahoo.com/bizwk/070822/aug2007db20070821451283.html?.v=1

<snip>

David Rosenberg isn't buying it. A North American economist at Merrill Lynch (NYSE:MER - News), he is one of a number of economists who say the concerns about too few workers are vastly overblown. Rosenberg recently studied the issue and put out a report entitled Is There a Labor Shortage? If employers are having trouble filling jobs, "perhaps they're not looking hard enough," he says.

The issue may not be the number of workers, but rather the level of pay. Economists like Rosenberg argue that in a market economy, there's really no such thing as a true shortage. If you want more of something, you can pay more and have it. When employers say that there's a worker shortage, what they really mean is they can't get enough workers at the price they want to pay, the argument goes. "While it makes for nice cocktail conversation, the data aren't saying there is an acute labor shortage in this country," Rosenberg says.


The truth may involve shades of gray. "There is not a general labor shortage in the U.S.," says David Wyss, chief economist for Standard & Poor's, which, like BusinessWeek, is a unit of The McGraw-Hill Cos. (NYSE:MHP - News). "There is a shortage of people willing to do grunt work for low wages -- the kind of shortage you want -- and a shortage in high-skilled jobs like scientists and engineers."


Interesting article that also talks about the 'true' unemployment rate when the 'discouraged' workers are added back into the unemployment numbers.

[TreasonousBastard]

1. More bullshit from economists who won't get off...

their sorry asses and do field research.

Yes, immigratn labor is being used in many areas to push wages down, but this is only a small part of the story. I've been in too many places where the locals, if any, won't do "that job" at any price.

Restaurants in suburban NJ are closing because they can't find wait and kitchen staff for miles around-- the locals are just too good for that sort of thing. Contractors head for the Home Depot parking lot to get rofferes and plasterers because the locals just don't do that sort of thing. "A" techs at some car dealers are making over a hundred grand because there just aren't enough good mechanics around. Small gas stations are closing their repair bays because they can't pay like thatand can't find mechanics.

Around here, there are some people who will take damn near any job at any pay, but the cheapest rental digs are around a grand a month, and you have to pay for your own heat. So, they try to hold out for something that allows them to pay the rent. If they can.

Not enough of them, though, and with the kids who used to do the hard work in very short supply lately, the roofers and gardeners have to put out the word for the South Americans to come in and fill the jobs.

The situation is extremely complex, and goes back through the many immigrant waves and even domestic population moves over the last 200 years, much of which is being repeated now. We don't have 10-20 million people to replace the immigrants in the meatpacking plants, pool-service companies, and restaurant kitchens at any wage level. Not only that, but we have even fewer who will take those jobs at any price because of too many with heightened expectations that as Americans, we deserve to watch "Dirty Jobs" but not have to do those dirty jobs.

[sinkingfeeling]

2. But this guy is arguing that if employers paid more, people would fill those jobs.

How can you believe there are more jobs available than people to fill them when we've all watched the 'job creation' numbers fall below normal 'growth' under the Bush administation?

[TreasonousBastard]

3. And I'm arguing that an academic should...

get off his ass once in a while.

Over the years I've seen a numberr of studies that blew these guys away when someone actually looked at what was going on in the real world rather than just run government numbers through a spreadsheet and a theory.

Job creation numbers come from random surveys tht attempt to include variables like seasonal employment but they may not have included a proper factor for the nonresponse rate, and I really doubt they have properly accounted for seasonal, temp, and part-time work.

On top of that, there are tons more retirees out there who are getting out at younger ages and have neither the need or interst in working. Used to be you worked till your late 60s and got your gold watch and a pension. Now, the few people with a decent pension, or personal savings of some sort, are bailing or being bought out in their 50s. No, I don't know exactly how many and it's anecdotal, but take the number of retirees and the lower birthrate of many American sectors and it looks like fewer employees even before we get to the spoiled suburban brats.