I wanted to draw your attention to this post at the Progressive Policy Institute by Ryan Craig on the “skills gap” which I found variously interesting, thought-provoking, and, occasionally, infuriating. I don’t think the “skills gap” is as real as he does but I do think it is important. Here’s an example of something I found infuriating:
Those who haven’t ever worked in the private might be forgiven for being skeptical about the existence of a skills shortage.
I have worked for 50 years in the private sector and I will affirm that the skills shortage is greatly exaggerated. During most of that period I have been a hirer—reading resumes, interviewing candidates, making offers, and so on. To the best of my ability to determine Mr. Craig’s actual private sector experience is pretty scanty. Instead his primary involvement is with education, rightly considered a “handmaiden sector”, either part of the government or intimately related to the government. The same can be said of finance, at least when what you’re financing is organizations heavily dependent on government grants.
The measurement he’s using, jobs on offer, is wrong. It is impossible to determine how many of the jobs that are being advertised actually exist or how many are merely stalking horses to justify bringing in somebody on an H1-B. The Minneapolis Fed, on the other hand, notes this:
Wages in STEM have been stagnant for 20 years, just as wages in most of the rest of the economy. If there were actually a shortage, you would expect wages to be rising.
Now there is an actual skills deficit but it’s not in skills taught by universities. It’s in the skilled trades and the skills needed by manufacturing workers. It’s in the basic skills that all employees need to be effective workers, things like showing up on time and having the right attitude.
It is notorious among engineering faculty that a significant fraction of BS engineering graduates never work in engineering. The fraction might be as high as half among civil engineers.
Of course, an accredited BS degree in engineering is a pretty good technical education, and the skills acquired are useful in many areas. So some engineers go to law or med school, some to the military, and some to related fields like technical sales.
But the point is that engineering schools produce a surplus of engineers each year.
It should also be noted that a substantial fraction of graduate engineering students are foreigners, mostly Chinese, and the very great majority of them must go home after 18 months for practical experience. The surplus of MS and PhD engineers is about 50%.
Finally, middle class salaries as a whole have been stagnant for a very long time, and unskilled or semi-skilled wages have been falling for 40 years. Women entering the work force, mass immigration (legal and illegal), automation, off-shoring, free trade…Econ 101.
Bob
The word “never†in the first paragraph caught my eye. That’s a big change from when I graduated. Tech sales siphoned off most of the non-practicing engineers back then. Of course, down the road people wound up all over the place, as you point out. Heck, I even know one guy who practiced in industry for a significant period of time before eventually going to the dark side and winding up in private equity.
The surplus of MS and PhDs doesn’t surprise me.