Comments on Marty Nemko: Why Double-Digit Unemployment will be Permanent

I work for an agency that has access to federal jo...

2009-09-15T05:24:27.453-07:00

I work for an agency that has access to federal job-training funds. We recently received a report on our job-placement performance for the previous fiscal year. We trained 27 people in truck driving -- none have gotten jobs (no commerce, no jobs moving goods); 10 people in solar installation -- one has gotten a job; 5 people in a maritime program -- one has gotten a job. We won't even send people to phlebotomy training anymore; there are too many unemployed experienced phlebotomists competing with our new, inexperienced grads. The same is beginning to happen for medical billing/ coding, pharmacy technology and even medical assisting.

I think two conditions led to this state:

1) More people go into training programs during a down economy because they can't find jobs. So more people are coming out of a training program at the very time when there are few openings for them. If it weren't for the economy, most of these people would still be employed and wouldn't even be coming to us for retraining.

2) Areas where there is actually job growth, e.g., the skilled trades, don't seem to be on anyone's radar -- not clients' and not counselors'. Yes, union apprenticeships are difficult to get into and most are only open every year or two, but there are community college classes to help people pass the entrance exams, some are open enrollment and there are also non-union programs to investigate.

Related to #2 is the fact that a couple of areas -- healthcare and green tech -- got a little *too* popular. They are seen as quick career fixes by clients who have previously held only warehouse, customer service or retail jobs. People who want speedy training to give them a "career" have flooded the lower levels of these fields. Yes, healthcare can absorb a lot -- and it did -- but at all levels -- and even it became over-subscribed. I heard that 80% of a recent graduating class of nurses at a local community college hadn't found jobs even several months after graduating -- a year ago, such a class all would have had job offers waiting. And I know three middle managers in healthcare who can't find work. As for the green tide that is to raise all boats, Marty is right: we have a legion of trained solar installers with no place to put them to work except in volunteer efforts such as GRID Alternatives.

Solutions? I dunno. Before being accepted into training, clients are required to provide labor market info "proving" employability after training, but LMI is a lagging indicator. Known no-growth areas are still labeled "in demand" on the national and California sites. The saddest thing is all the truck drivers, many of whom are ex-felons, desperately trying to "make it" on the outside and avoid going back to prison.

Anonymous, I appreciate the thoughtful post but I ...

2009-09-14T23:37:53.886-07:00

Anonymous, I appreciate the thoughtful post but I raise the following rejoinders:

1. How confident are you that the amount of legitimate use of FMLA outweighs its dissembling use?

2. TODAY's 20-somethings have very different attitudes toward work than the previous generation's.

3. An extreme example of employer bad behavior such as firing someone because he's got a bottle of prozac on his desk is too atypical to be a sound counterargument.

4. You may--in part because you paid for it yourself and in part because you are brigh--have benefited from job retraining, but as a national effort, the data is clear that it's been a dismal failure.

While you've cogently presented employers' motivat...

2009-09-14T20:49:31.436-07:00

While you've cogently presented employers' motivations for not hiring, I must admit my visceral distaste for much of what you've written, in light of the possible implications for, well, the "ungifted", of whose ranks many would consider me a member.

- While I agree that employers should not be required to pay employees while they're on FMLA leave, the very existence of the FMLA provision makes it possible for many of those having caregiving obligations to remain gainfully employed. If FMLA were rolled back or revoked, I'm concerned that the ultimate effect would be to render that portion of the workforce having recurring caregiving obligations effectively unemployable. At this time in our history, particularly compared with the pre-WWII era, many working adults lack a support network of available and responsible family or friends willing and able to assist with caregiving obligations that inevitably occur during business hours, including transportation to medical appointments, assisting children, spouses, or aged parents undergoing/convalescing from surgeries or other medical procedures, etc.

Were FMLA to be repealed, workers who are terminated or encouraged to quit when their caregiving obligations became too inconvenient for their employers to bear would quickly find themselves radioactive and able to obtain employment only as independent contractors (those who have highly sought after expertise or skills), contingent workers (those whose skills are marketable though common), or menial labor (semi or unskilled labor). The latter two - and particularly the last - group are at high risk of having their lives descend into what can be best described as a death spiral of downward mobility. Imagine having to explain to a prospective employer that you were terminated because you used too much vacation time in order to care for a sick spouse - talk about radioactive.

- I disagree with your generalization concerning younger members of the workforce. In my own case, I found it considerably easier from both a stamina and logistical standpoint to work frequent 60-70+ hour workweeks when I was in my late 20s and 30s than I do today because I was more energetic at that age and my family obligations had yet to reach a critical mass to the point where they competed with work as a priority. Additionally, I’ve encountered numerous young professionals whose efforts equaled or even surpassed what I put forth back in the day.

- I agree that a slacker employee shouldn't be able to play "cards" (race, gender, or even disability) to thwart an employer’s efforts to rid themselves of a problem. However, laws that protect employees should be modified surgically rather than gutted. For example, should an employer be permitted to fire an employee solely because a boss happened to inadvertently notice a prescription bottle for, say, prozac in the employee's name if the employee is otherwise in good standing? If a company is undergoing layoffs and had a workforce that was 20% minority prior to the layoffs...but 70% of those laid off were minorities (controlling for positions, departments, etc.), shouldn't the laid off have some means of redress if race can be definitively established as a motivating factor?

- I'm not persuaded that training displaced workers is an exercise in futility - based on my own experience and success with pursuing retraining about a decade or so ago (on my own dime). Displaced workers have families that depend upon them for their very survival. Even if today’s retraining all too frequently fails, I can’t agree that government should provide no such assistance. Further, while I like your idea of teaching entrepreneurship from an early age, not everyone is cut out for it.

I'm certainly not asking you to modify your own views - only to be mindful that even the most economically rational and cost-benefit analysis-certified policy prescriptions can, if enacted, have very adverse consequences for those who are vulnerable and are unfortunate enough to be caught in their blowback.

Here is something to remember if you move back to ...

2009-09-14T20:20:44.675-07:00

Here is something to remember if you move back to the "red" states from California. This was posted on the blog for the Lincoln Journal/Star:

"I was born and raised in Lincoln and moved back last year to raise my family. Affordable housing, good schools and a lower cost of living shaped our decision. That said, our biggest challenge was in finding good paying jobs that helped pay the bills. We got lucky and I found a decent paying job in my field, and we're enjoying the change from California living.

Nebraskans complain too much about taxes. Go live elsewhere if perceived high taxes is your biggest complaint. Or go live in California and see what you get for your taxes? In Lincoln we pay property taxes and have a great school system that contines to expand to meet the needs of the city. In California they're closing schools, consolidating schools and laying off teachers because their tax structure cannot pay for new schools. We all make our choices. I'll pay reasonable taxes if I see a return. Here in Lincoln the value of a good education is evident. My kids love the schools here.

We just need better paying jobs with better benefits. And more rights for employees."

Unemployment, both in the U.S. and the world as a ...

2009-09-14T04:40:31.241-07:00

Unemployment, both in the U.S. and the world as a whole, marches ever higher because the field of economics doesn't account for the relationship between population density and per capita consumption.

Following the beating the field of economics took over the seeming failure of Malthus' theory, economist adamantly refuse to ever again consider the effects of population growth. If they did, they might come to understand that once an optimum population density is breached, further over-crowding begins to erode per capita consumption and, consequently, per capita employment.

And these effects of an excessive population density are actually imported when a nation like the U.S. attempts to trade freely with other nations much more densely populated - nations like China, Japan, Germany, Korea and a host of others. The result is an automatic trade deficit and loss of jobs - tantamount to economic suicide.

Using 2006 data, an in-depth analysis reveals that, of our top twenty per capita trade deficits in manufactured goods (the trade deficit divided by the population of the country in question), eighteen are with nations much more densely populated than our own. Even more revealing, if the nations of the world are divided equally around the median population density, the U.S. had a trade surplus in manufactured goods of $17 billion with the half of nations below the median population density. With the half above the median, we had a $480 billion deficit!

If you‘re interested in learning more about this important new economic theory, then I invite you to visit either of my web sites at OpenWindowPublishingCo.com or PeteMurphy.wordpress.com where you can read the preface, join in the blog discussion and, of course, buy the book if you like. (It's also available at Amazon.com.)

Pete Murphy
Author, "Five Short Blasts"