Monday, March 31, 2014

Is there a job skills gap?

Paul Krugman says no and he has some careful studies to back him up. He does not mention -- it's only a short column, he cannot get to everything -- what's missing in the areas of highest unemployment, namely the deep rural areas and the core of the cities. What's missing is jobs.

 Where would you find them? China, Paraguay, places like that. We shipped off tens of millions of jobs, and they weren't just jobs, they were jobs in places. Manhattan, for example, used to be full of garment making work. Some of that still exists, mostly in Los Angeles; but most of it is gone.

Krugman links to another Times story about an American firm that claims it has garment-making jobs going unfilled for lack of trained seamsters. The factory is in Minneapolis. Duh. If you want to hire trained seamsters, you do not place your factory in Minneapolis. If you do, plan to train seamsters yourself and stop bitching.

 Even after two generations spent reporting on American business, the stupidity and incompetence of American business managers, taken as a whole, still amazes me.
Brother, can you spare me a dime?

It took over 50 years to depopulate the rural South. Americans are, individually, mobile people but whole communities are not. Nor should we wish them to be.

 Now the core cities are slowly being depopulated (and repopulated, which is also happening, very slowly, in parts of the South). I guarantee you that the rightwingers do not wish that the left-behinds in the core cities suddenly show up in their suburbs and new towns competing with their kids for jobs. Nor, probably, do many of the leftwingers, but I make the distinction because it is rightwingers who blame the remnants of the old industrial workforces for being jobless.

 It is not the son of the machine-minder in Brooklyn (I am thinking of a neighborhood near the Aviation High School that used to be filled with small machine shops) who is responsible for the structural changes in the distribution of jobs.

It is not hard to see why kids in decayed areas do not see much hope for themselves or much point in working hard in school. Some will. Many will not.

 The voodoo economists who cheered the export of America's industrial jobs thought that the magic of the marketplace would fill in after, and they (that is, government) did not need to do anything. To a degree, new jobs were created. But not where they had been.

 If you want to be disgusted just read the comments under any news story about an inner city episode that makes the news.

 But it is not only the lumpenproletariat who have learned that creative destruction means destruction. I am reminded of a highly educated woman on Maui with two even more highly educated sons. Back during the Reagan recession, she was moaning that her boys, despite their combined 6 diplomas in scientific disciplines, were both unable to find work. When Krugman claims
Above all, we should see workers with the right skills doing well, while only those without those skills are doing badly. We don’t.
he is right. And his summation is correct, too:
Unfortunately, the skills myth — like the myth of a looming debt crisis — is having dire effects on real-world policy. Instead of focusing on the way disastrously wrongheaded fiscal policy and inadequate action by the Federal Reserve have crippled the economy and demanding action, important people piously wring their hands about the failings of American workers. Moreover, by blaming workers for their own plight, the skills myth shifts attention away from the spectacle of soaring profits and bonuses even as employment and wages stagnate.


  1. Harry wrote: "Even after two generations spent reporting on American business, the stupidity and incompetence of American business managers, taken as a whole, still amazes me."

    What amazes the rest of us, is why someone like you, who could obviously be amazing at running companies WHILE improving the lot of the low-level worker, doesn't start some companies already? :-)

  2. No capital, until now. But now I'm retired. Besides, I was doing something I liked that I thought was useful.

  3. Furthermore, even if started and ran a huge company and did it so well, that would have had 0 impact on the problem.

    I understand very well the theory by which managers are paid 400 times as much as competent and productive workers and absolved of taxes to boot. Supposedly that ensures getting the best able managers.

    It's another example of market failure because what we get are incompetent sociopaths. The reward system works out as it always does in systems that glorify individualism: the brigands and cheats thrive.