The Pitch

The editors of the Wall Street Journal renew their pitch for mass immigration:

Democrats and many Republicans complain that U.S. corporations are raking in huge profits as blue-collar jobs disappear. The reality is the opposite, a new Conference Board business survey reports. Corporate profits have been declining as employers increase wages to hire scarce blue-collar workers, but hold the champagne.

Eighty-five percent of blue-collar businesses report recruiting difficulties versus 64% of white-collar employers. One reason is the working-age population without a college degree is shrinking as baby boomers retire and more young people enroll in college. Labor participation among 16- to 24-year-olds has fallen 10 percentage points in two decades.

and

Nonetheless, 90% of blue-collar businesses report operating with unfilled positions, and 29% say this has made them reduce output or turn down business. Rising wages together with sluggish productivity growth are crimping corporate profits. Between the fourth quarter of 2014 and the second quarter of 2019, profits for nonfinancial corporations declined 17% and 46% for manufacturers.

Frankly, having been in the situation of seeing how job notices can be crafted to avoid applications, I’m a bit skeptical of their statistics. I wish they had explained why the jobs are “unfilled”. Are there too few applicants, too few applicants deemed qualified, or do the qualified applicants want more than they’re willing to offer? The answers matter.

One way of avoiding applications is to advertise job in Peoria from your Sitka branch. Not enough people who might be interested will see it. Another way is to tailor the notice so that no one or practically no one can fill it. The classic example of that was the ad from 1983 for an IBM PC programming expert with five years of experience. Nobody satisfied those requirements in 1983. Nowadays for a comparable case you’d have 50 resumes on your desk from Tata of people all claiming to have the requisite experience. You’d have no way to validate the claims so and they’re willing to work for a lot less than the workers you already have so why the heck not?

Additionally, 30 years of industrial policy focused on college educations have convinced people that there’s something distasteful or dishonorable about blue collar jobs. Too many young people today are looking for jobs as communications directors or marketing analysts that pay $120,000 a year for entry level workers.

4 comments… add one
  • TarsTarkas Link

    Having been in the truck equipment outfitting business for 35+ years, getting qualified hydraulic and installation mechanics sometimes seems to be harder than trying to split diamonds with a paint paddle. The tech schools are turning out kids who are better at pressing buttons than turning a wrench.

    Conversely, current vehicle electronics make it harder for the older mechanics to diagnose and fix vehicles properly, so that’s a trade-off.

    I blame the you-gotta-go-to-college to get a good job push for a lot of this. The current situation is great for the competent self-employed handyman, plumber, electrician, etc., but also restricts their ability to expand beyond one or two-man operations. No quick solution, I’m afraid.

  • Guarneri Link

    “Too many young people today are looking for jobs as communications directors or marketing analysts that pay $120,000 a year for entry level workers.”

    That figure seems awfully high, but in any event…..

    I happen to know a young woman whose internships were in .those very fields, but has decided she wants to teach in the KIPP charter school program. Interestingly, the (oversubscribed) interviewee pool was chock full of students from Harvard, Yale, Georgetown, Duke, Richmond, Wake etc. I’m sure your overall point is correct, but there are people out there following alternative paths.

    I wonder if a KIPP-like model would be successful for blue collar skills. We used to call it trade school.

  • That figure seems awfully high, but in any event…..

    I guess you haven’t interviewed as many new grads whose salary demands are more than I’m making as I have. I have mixed feelings about intern programs. On the one hand I think that they could be a good alternative to higher education. On the other I think they’re too-frequently used by companies as alternatives to properly compensated permanent employees.

  • Guarneri Link

    You are correct, Dave, that I haven’t interviewed as many new grads, as that number is zero. But I am aware of published statistics. $120k sounds like a petroleum engineer or Wall Street associate. But if you say otherwise I believe you.

    More broadly, if it wasn’t obvious, I’m talking about my daughter. The internships were great. One in premium brands public relations at a small shop where she was given invaluable freedom and responsibility at a young age. They paid, and she has a standing offer. The other was digital/media marketing in a medium sized firm in NY. They didn’t pay. (Heh. Her dad did). But it got the NY bug out of her system. Worth it.

    But her real calling seems to be in education policy and advocacy, focused on lower income, generally minority, kids. It starts with boots on the ground training – you teach. I simply advise her that ultimately she needs to understand she needs to have influence. That means think tanks, law degree, policy positions etc. we will see. She will make 40% of the number you cite. But I didn’t do all I did in my career for me. If this is her calling, she has financial security in a trust. It’s one of the reasons I think it’s bone headed to give the state your money at death. Anyone think that money will find its most productive use? But that’s for another day.

    There are young people out there of all stripes with all sorts of motivations. Money, altruism, empathy, true passion for the work….

    Bring it back to the blue collar issue. We glorify certain lines of work. Entertainers of all sorts. Wall Streeters. Titans of industry. Artists. We always have. But we haven’t always financed it like student loans. Your idiotic government at work.

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