Tuesday, November 27, 2012

The skills gap is phony. Period.

That skills gap you've been hearing about sounds a lot like the fake truck driver shortage the trucking companies are always flogging.

There's no shortage of skilled American workers. The real shortage is people willing to work for slave wages.

Adam Davidson, writing in the New York Times, looked into the so-called skills gap in advanced manufacturing. He concluded that running the computers that run the machines does require a good deal of technical skill:
Running these machines requires a basic understanding of metallurgy, physics, chemistry, pneumatics, electrical wiring and computer code. It also requires a worker with the ability to figure out what’s going on when the machine isn’t working properly.
Here's the rub (you knew what it was): Employers are only willing to pay burger-flipper wages for jobs requiring that technical skill. Davidson visited a Wisconsin manufacturer, and this is what he found:
Eric Isbister, the C.E.O. of GenMet, a metal-fabricating manufacturer outside Milwaukee, told me that he would hire as many skilled workers as show up at his door. Last year, he received 1,051 applications and found only 25 people who were qualified. He hired all of them, but soon had to fire 15. Part of Isbister’s pickiness, he says, comes from an avoidance of workers with experience in a “union-type job.” Isbister, after all, doesn’t abide by strict work rules and $30-an-hour salaries. At GenMet, the starting pay is $10 an hour. Those with an associate degree can make $15, which can rise to $18 an hour after several years of good performance. From what I understand, a new shift manager at a nearby McDonald’s can earn around $14 an hour. 
Even the management consulting firm Boston Consulting Group concluded that trying to hire highly skilled workers at low wages is not a skills gap.

Commenting on Davidson's article, which was cross-posted on the Trade Reform blog, Will Wilkin wrote there is one kind of skills gap to be concerned about:
If you want a cell phone or an LCD device (from televisions to a Kindle) you will not find one made in USA, despite LCD technology being invented here. LCD being one of hundreds of examples of industrial capacity lost to America, the list is growing every year. 
Look at our trade with China, their #1 export to us is electronics and tech goods and our #1 export to them is scrap metal and other waste. America is losing the ability to make more and more things we use, that is not automation or “productivity gains,” that is offshoring. 
Now that's something to worry about.