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Even A Stopped Clock . . .[Paul Krugman, Making Sense!]
Center For Immigration Studies ^ | 26 November 2012 | Mark Krikorian

Posted on 11/27/2012 11:39:40 AM PST by zeestephen

"Whenever you see some business person complaining how he can’t find workers with the necessary skills, ask what wage they’re offering."

(Excerpt) Read more at cis.org ...


TOPICS: News/Current Events
KEYWORDS: immigration
Paul Krugman writes...

"Whenever you see some business person quoted complaining about how he or she can’t find workers with the necessary skills, ask what wage they’re offering. Almost always, it turns out that what said business person really wants is highly (and expensively) educated workers at a manual-labor wage."

And...

"[Employers] claim that much of our unemployment is “structural”, due to a mismatch between skills and labor demand. If that were true, you should see soaring wages for those workers who do have the right skills; in fact, with rare exceptions you don’t."

1 posted on 11/27/2012 11:39:43 AM PST by zeestephen
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To: zeestephen

That’s been the Dem talking-point for at least a few days.


2 posted on 11/27/2012 11:43:53 AM PST by 1rudeboy
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To: zeestephen

The reverse is also true.

When an employee complains about his pay, ask him why he took the job in the first place.


3 posted on 11/27/2012 11:46:59 AM PST by GeronL (http://asspos.blogspot.com)
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To: GeronL

Also ask how much of the offered wage is reduced due to taxes (inventory, property), regulatory (paperwork), workman’s comp, soon-to-be obozocare, retraining expense because poor education (not taught, or did not learn when taught)etc., etc. etc


4 posted on 11/27/2012 11:51:38 AM PST by Susquehanna Patriot (U Think Leftist/Liberals Still Believe That Dissent = Highest Form of Patriotism?)
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To: zeestephen

5 posted on 11/27/2012 11:52:48 AM PST by Brandonmark (OWCM is The new American Minority!)
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To: zeestephen

Not a fan of Krugman’s “economics” here but I see it all the time as a manufacturing consultant on the inability of business to address a labor shortage with wage incentives.


6 posted on 11/27/2012 11:53:47 AM PST by T-Bird45 (It feels like the seventies, and it shouldn't.)
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To: zeestephen

The Free market is great until you talk about labor, then the games start. H-1b, illegals, off shoring etc. ANYTHING to hold wages down.


7 posted on 11/27/2012 11:59:55 AM PST by central_va ( I won't be reconstructed and I do not give a damn.)
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To: zeestephen; 1rudeboy

This guy (Krugman) is truly an idiot...

“Almost always, it turns out that what said business person really wants is highly (and expensively) educated workers at a manual-labor wage.””

Of course the businessman always wants to pay the least he can to get the job done (which is to get a product or service out AND make a profit).

Similarly the employee wants to make as much as possible, and still get a job.

Now if you have a government that pays you for almost 2 years for not working, and then when that runs out you can get free housing, food, plus a few extras - guess what a lot of people think that’s just fine, maybe supplemented with an under the table job here and there.

That’s what causes structural (government designed) unemployment.

So to fulfill their labor and profit requirements, companies take their businesses elsewhere... or they hire illegals.


8 posted on 11/27/2012 12:00:30 PM PST by aquila48
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To: central_va; zeestephen

“The Free market is great until you talk about labor, then the games start. H-1b, illegals, off shoring etc. ANYTHING to hold wages down.”

Do you ever go to Wal-Mart to complain that their prices are too low?

It’s amazing that even here in Free Republic land so many see only one side of the equation - THEIRS. But why should I be surprised - it is a fact of life that people worry about their self-interest first and foremost - and that’s fine as far as it goes. But if you’re trying to objectively analyze a problem, then it pays to be intellectually honest.


9 posted on 11/27/2012 12:06:53 PM PST by aquila48
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To: Susquehanna Patriot

bump


10 posted on 11/27/2012 12:06:53 PM PST by GeronL (http://asspos.blogspot.com)
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To: central_va

Well said, can’t say how many times I’ve heard people in my social circle say they “are gonna get some Mexicans”, but with the simple minded assertion that such is cost neutral at best for society.


11 posted on 11/27/2012 12:12:28 PM PST by junta ("Peace is a racket", testimony from crime boss Barrack Hussein Obama.)
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To: zeestephen
"Whenever you see some business person complaining how he can’t find workers with the necessary skills, ask what wage they’re offering."

We pay above average wages and we are willing to teach the skills - to employees with the necessary character. That's the part we rarely find.

12 posted on 11/27/2012 12:21:08 PM PST by Mr. Jeeves (CTRL-GALT-DELETE)
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To: GeronL

Supply and demand. In the late 90’s In&Out Burger in Gilroy CA was hiring burger flippers for upwards of $12 bucks an hour, and still having trouble finding help.


13 posted on 11/27/2012 12:23:01 PM PST by woodenickel
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To: GeronL

I think it’s usually because they want some pay instead of no pay.


14 posted on 11/27/2012 12:23:20 PM PST by stuartcr ("When silence speaks, it speaks only to those that have already decided what they want to hear.")
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To: stuartcr

so going on strike and putting companies out of business helps this, how?


15 posted on 11/27/2012 12:27:38 PM PST by GeronL (http://asspos.blogspot.com)
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To: GeronL

Is that even relevant to this thread? I didn’t see anything about going on strike.


16 posted on 11/27/2012 12:32:17 PM PST by stuartcr ("When silence speaks, it speaks only to those that have already decided what they want to hear.")
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To: zeestephen
Just because someone starts at $10 p/h doesn't mean they have to stay at $10 p/h.

I'm always amazed by people "stuck" in a dead end job; learn something and get a better job.

I know bricklayers that make more than $100K p/y. Not all bricklayers can make that kind of money but the ones that are that DAMN GOOD do.

And Krugman, defying all the odds, is always wrong!

17 posted on 11/27/2012 12:32:46 PM PST by Pietro
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To: GeronL

An employer pays what is prevailing in the community for the skills involved.

I would certainly expect a surgeon to get paid more than a janitor...even it the janitor has 9 kids.

Their biggest problem is that vocational classes have been gone from the high schools for a number of years and it is starting to hit home with employers.

More & more kids are being pushed into loans to attend college and they still do not have a marketable skill. They then also demand an unreasonable wage to start their ‘career’, because they have the loans to pay, their new BMW payment & the cost of their high end apartment. Don’t forget the clothes, jewelry & the entertainment costs, either. They think they are entitled to a starting salary of over $90,000 a year and they don’t understand why they cannot get that.

Meanwhile, there are over 238,000 known manufacturing jobs going begging in the USA because the companies cannot find persons with a high school diploma, a GED, or who can clearly write & can read simple information.

I don’t know where the plumbers, carpenters, auto mechanics and other tradesmen ware going to come from. IF Obama thinks he can assign all those jobs to the illegals, he is in for a surprise. I will roof my own house before I allow an illegal on my property.

Meanwhile, employers have no obligation to bankrupt themselves to ‘pay a living wage’ like San Francisco thinks is necessry. The living wag crowd and the union crowd doesn’t get it.

IF I am starting a company from scratch with my own funds & efforts, I will NOT hire & pay for more useless bodies just to have them off the unemployment rolls. Telling me to pay $6000 a year in Obamacare costs per employee will make me lay off enough people to escape this cost & to put in more time myself. I can use that $6000 per employee in my own bank account and I know the value of every dollar—I own the business!!!!


18 posted on 11/27/2012 12:36:27 PM PST by ridesthemiles
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To: ridesthemiles

bump


19 posted on 11/27/2012 12:41:43 PM PST by GeronL (http://asspos.blogspot.com)
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To: aquila48

>>>It’s amazing that even here in Free Republic land so many see only one side of the equation - THEIRS. But why should I be surprised - it is a fact of life that people worry about their self-interest first and foremost

Very true.

And that is the heart of Frederic Bastiat’s (and Henry Hazlitt’s) Great Lesson in economics.


20 posted on 11/27/2012 12:50:39 PM PST by GoodDay
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To: central_va

A free market works like this:

I am free to hire any willing worker who I wish and pay them what I wish and that they will accept. You are free to choose to accept or not accept that job at that pay.

If I cannot find someone to work at the pay I offer then I will have to raise my offer until someone accepts it. If you cannot find a job at your desired pay then you may have to lower your requested pay until you get a job.

The job I have may not provide enough benefit to me to raise the offer so the job will go unfilled. Or the person under consideration may not produce enough economic benefit to justify higher pay. You may refuse a job because it does not provide enough benefit and remain unemployed.

That is how all free markets work absent coercion and restrictions. In a free market there are no visas or quotas or waivers because there are no restrictions to start with. The US does not have a free market for labor so do not bash what does not exist.


21 posted on 11/27/2012 1:07:12 PM PST by FreedomNotSafety
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To: FReepers; Patriots; FRiends

FR really needs your help!

Please Contribute Today.

FReepathon Day 58!!

22 posted on 11/27/2012 1:08:28 PM PST by onyx (FREE REPUBLIC IS HERE TO STAY! DONATE MONTHLY! IF YOU WANT ON SARAH PALIN''S PING LIST, LET ME KNOW)
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To: aquila48

Thats right, those Obozo voters voted their self interest instead of voting for a capable leader or for voting for their country.


23 posted on 11/27/2012 1:24:04 PM PST by ully2
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To: ully2

“Thats right, those Obozo voters voted their self interest instead of voting for a capable leader or for voting for their country.”

The problem is NOT that they voted for their self interest - we all look out for our self interest and we absolutely should do that.

The problem is that they’re being shortsighted, unwise. They may have voted for their SHORT TERM self interest, but in the LONG TERM Obama’s policies will definitely NOT be in their interests.

So the distinction is between being foolish vs wise. The fools won.


24 posted on 11/27/2012 1:33:44 PM PST by aquila48
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To: zeestephen

“ask what wage they’re offering”

The wage would-be workers want may just not match what the expected productivity is worth. High unemployment & welfare handouts make not working a viable option, requiring untenable wages for actual work to compete therewith. If the value of the work is less than wages needed to attract a worker, the work doesn’t get done and the worker doesn’t get paid.

Employer funds are not unlimited.


25 posted on 11/27/2012 1:36:10 PM PST by ctdonath2 ($1 meals: http://abuckaplate.blogspot.com)
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To: zeestephen
Almost always, it turns out that what said business person really wants is highly (and expensively) educated workers at a manual-labor wage. No wonder they come up short.

The principle of uniform wage rates states that in a free society there is a tendency for wage rates to be equal within a level of labor but unequal between levels. All other considerations being equal, professional level work requires higher pay to attract workers than skilled labor, and skilled labor requires higher pay than unskilled labor.So if an employer wants skilled labor, he will have to pay more than unskilled labor wages.

26 posted on 11/27/2012 1:54:22 PM PST by mjp ((pro-{God, reality, reason, egoism, individualism, natural rights, limited government, capitalism}))
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To: zeestephen

Yes, if you offered $1 million per hour, there would be a line for almost anything. But Propagandist Paul Krugman avoids the fact that wages can only go so high before they render an enterprise uneconomic. From articles and job ads I have seen, many would-be employers are offering rather high wages. The “unfilled jobs” generally require highly specialized technical skills and experience, a clean background, high reliability (”character” as someone posted above), etc. (An amazing number of unfilled jobs listed in my area require high-tech skills, intel experience and a TS/SCI clearance, ruling out everyone but ex-mil and gov intel types). The problem is a lack of people with the narrowly specialized skills and reliability to qualify. Investing in training makes sense for both employers and employees only when both will commit to the job long-term. Perhaps employers need to revisit long-term employment contracts, in combination with attractive wages/benefits.


27 posted on 11/27/2012 3:02:28 PM PST by Chewbarkah
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To: Chewbarkah

I saw a posting on Reddit written by an HR person for an IT position. Must have five years experience in a programming language only 3-4 years old.
It is depressing how many job postings are written to exclude Americans, so that employers can then bring in immigrants on visa to pay a lower wage AND have on a short leash.


28 posted on 11/27/2012 4:33:14 PM PST by tbw2
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To: zeestephen

This isn’t the entire equation. Revenue models may not support wage payout of what the market might bear. If an employee is not adding value to a company ABOVE his salary and benefits, there’s no reason to hire him.


29 posted on 11/27/2012 4:43:17 PM PST by 1L
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To: zeestephen
The cost of wages is now treated as any other commodity: it's purchased where it's cheapest ("shareholder value", you know).

I think "increasing shareholder value" is sheer stupidity in some cases. So I save $1.00 per unit on computer chips made in the PRC. Do you really want a communist country as a supplier for computer chips for anything we use in the USA?

Just look at the things the've done with foodstuffs.

Impeach the kenyan or secession.


30 posted on 11/27/2012 4:56:02 PM PST by ex91B10 (We've tried the Soap Box,the Ballot Box and the Jury Box; ONE BOX LEFT!)
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To: FreedomNotSafety
In a free market there are no visas or quotas or waivers because there are no restrictions to start with. The US does not have a free market for labor so do not bash what does not exist.

So you are an open border gloBULList. I am not. Almost everything you said was true when applied to US citizens, when you start importing people then I get to have a say. Sorry bub. The free market ends at the shoreline. We are AMERICANS first whether you like it or not.

31 posted on 11/27/2012 5:07:54 PM PST by central_va ( I won't be reconstructed and I do not give a damn.)
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To: zeestephen

If

—no one wants to sweep your floor for $8.00 an hour, and

—everyone would want to sweep your floor for $50.00 an hour, then

—you’ll have to find the number between $8.00 and $50.00 an hour at which you will attract at least one job applicant, or

— sweep your own dang floor.

All y’all smart enough to start and run your own businesses should be able to figure that one out.


32 posted on 11/27/2012 5:24:06 PM PST by ExGeeEye (I'll give y'all 90 days for the wounds to heal; then we start on 2014. Carpe GOP!)
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To: ExGeeEye

Have you ever noticed that, without exception, in HR departments and in upper management positions there are no H-1b visa employees?


33 posted on 11/27/2012 5:28:34 PM PST by central_va ( I won't be reconstructed and I do not give a damn.)
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To: central_va

You can make it a closed market if you wish but you wont drive wages up and you will drive jobs out of the country. I am sure you know what wages should be and are more than willing to have the government enforce your idea. Should make you popular with the AFL-CIO.

Yes it applies to americans but I will assume you are not in favor of immigrants who become citizens either.

I am really glad your mindset was not predominant when my family came here. They worked real cheap in coal mines and logging.


34 posted on 11/27/2012 5:50:57 PM PST by FreedomNotSafety
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To: FreedomNotSafety
You can make it a closed market if you wish but you wont drive wages up and you will drive jobs out of the country.

Not if tariffs are erected to keep the profit margin too low to off shore. And this is to protect the 94% of workers that are non union.

35 posted on 11/27/2012 5:56:14 PM PST by central_va ( I won't be reconstructed and I do not give a damn.)
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To: 1L

Re: “Revenue models may not support [a high] wage payout.”

Agree.

But just say that, and nothing else.

Instead, businesses have begun asking taxpayers to train their workers, and they ask government to increase the supply of cheap labor.

If you can’t afford the labor, close your business, or start a new business.


36 posted on 11/28/2012 1:01:01 AM PST by zeestephen
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To: aquila48
They may have voted for their SHORT TERM self interest, but in the LONG TERM Obama’s policies will definitely NOT be in their interests.

Not necessarily. Besides the political class and "connected" people, who do you think will be LAST to feel the effects of a bankrupt government? It will be the Democrat moocher base, guaranteed. Working, taxpaying, traditional American families will get hammered bloody and nearly dead before there are any real cuts to the freebies handed over by Democrat politicians to the moochers in exchange for their votes. And the moochers know it. They're "entitled". And they want their free stuff today.

Two years from now, or two weeks from now, is not even on their radar screens.

37 posted on 11/28/2012 1:26:39 AM PST by Lancey Howard
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To: zeestephen
Instead, businesses have begun asking taxpayers to train their workers...

What are you smoking?
First, businesses ARE taxpayers. Most are big time taxpayers.
Second, they wouldn't ask government to train their workers - - most "labor" is on-the-job training anyway. Government "job training" programs are a political pander to help politicians look like they care about the unemployed. The politicians LOVE government "job training" programs.

38 posted on 11/28/2012 1:36:37 AM PST by Lancey Howard
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To: zeestephen
I want to bring up another issue...

Part of the problem with salaries and wages is that there is very limited information available to the average job seeker.

Most people do not know what the median pay is for the job they are seeking, and most people do not know where their skills and performance rank on the broader pay range.

For many managerial and professional jobs, it is actually considered uncouth to discuss salary during the first interview.

At virtually all jobs - white collar or blue - management discourages talk about pay between co-workers, and frankly, most co-workers are extremely reluctant to discuss their pay with others.

Thus, employers hold ALL the high cards on this issue.

HR Departments are highly informed about pay scales.

In fact, ten years ago when I worked in the computer chip industry in Portland OR, every major manufacturer SHARED their blue collar wage scales with every other HR Department.

I think wages and salaries should be completely transparent.

In a public company, the pay of the top officers must be reported each quarter.

A CEO at one company knows exactly what the CEO at another company is being paid.

The result?

CEO pay goes up faster than any other job in the economy.

I think if all companies were required to report the pay of all employees, wages for many jobs would instantly start to rise.

39 posted on 11/28/2012 1:44:07 AM PST by zeestephen
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To: Lancey Howard
I don't smoke.

I have read a dozen stories in the last few months about businesses that claim they cannot find skilled workers.

They are not suggesting the government train them.

They are suggesting that the government PAY to train them.

Business wants work-ready employees.

They don't want to pay anyone for training.

40 posted on 11/28/2012 1:51:05 AM PST by zeestephen
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To: zeestephen
Business wants work-ready employees.

God knows that people who graduate from the government high schools aren't work-ready. Why should businesses teach somebody a trade? OF COURSE they want to hire people with the skills they think are needed, but they also want people with the character and ambition to go out and GET the training they need. If the pandering politicians who want to pretend they "care" about the unemployed want to throw taxpayer money at "job training programs", that's not the businesses' fault.

41 posted on 11/28/2012 2:28:42 AM PST by Lancey Howard
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