Why can’t employers attract the 9 million jobless people into their 9 million available jobs? The Wall Street Journal highlights this great mismatch, which has put a kink into the Beveridge Curve — traditionally used to describe the relationship between work and workers. What if the kink is permanent?
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24 replies on “The Great Mismatch: Why 9 Million Jobs Can’t Attract 9 Million Jobless People”
It is called RESPONSIBILITY, ACCOUNTABILITY and a solid work ETHNIC. Entitlement has replaced personal effort that automatically LEADS to joining the Victim class where NOTHING is expected on a member BUT reaching out for “free”m stuff. Far FAR too many PEOPLE will take the path of least resistance when the reward is GREATER than the Alternative path.
The Folks have become to use to “FREE” stuff not realizing that someone someplace MUST pay for that “FREE” stuff. “Ignorance is NEVER an excuse for Stupidity.” Emotions have captured and put self-responsibility into the Gulag.
Life is cruel. It usually does not CARE much about you UNLESS you have a Skill, Talent or Education. Also it puts greet value on PERSEVERANCE. To succeed, one usually MUST first FAIL. FAILURE helps the individual understand and seek SUCCESS.
Scott, I was one of those people in the production department of our local newspaper. I used to build the pages by hand, using an Xacto and my innate skills. Our department was phased out due to electronic pagination.
It was a sad day, but I was hired under the cloud that “one day this department will be gone”. It took nearly 20 years for that one day to come, but it did.
Our crew was given the timeframe of when the switch would happen. We were also given the option to transfer to other departments. Some took up that offer, but most stayed until the end. It was just another indication to me that we were a team, until the end.
While we worked closely with the editorial staff, very few stood up to ask what was going to happen to our team. I appreciate your efforts on behalf of all of the people who lost jobs due to encroaching technology.
I remember back in the early 70s just after I entered the workforce seeing a bumper sticker that said “Look alive or you could be replaced by a button!” How true that quote has become! Now robots are activated by the push of a button that does a job in a few seconds that used to take several people hours to perform. Learn to be a “button-pusher” to program what that button activates!
Hmmm, I think you’re missing it. One: Information as a product is only valuable when it connects with physical change, ex: that computer produced newspaper had to have an automatic (robot) production machine tied to the computers that created the graphic layout. So there is a limit to the information age jobs.
Two, the Gov’t. and Fed pumping ‘air’ into our economy by those $300 checks (per child) they’re flooding us with is basically an attempt to corrupt the individual worker to start looking at the Govt. as a “alternate, big brother provider”. Given enough of this will distort our productive attitude, promote lethargy and create a class of people who want that dole…all the time. Like “old man Potter” they’re buying our independence at 20 cents on the dollar!! And we don’t see it coming!
I’ve supported myself through free-lance work since 1987, but not every temperament is well-suited for it. Perhaps our digital economy’s increasing lack of stability is the reason an unprecedented percentage of Americans are willing to sacrifice their self-determination for top-down, centralized government control?
Although…Insurance sure is nice.
There are some people who actually took advantage of the 18 months of forced off from work and the money coming in to set themselves up in something else. There are quite a few restaurants near me who when they called people to come back, those people had either left town or were already working in a different industry. Good for them for taking advantage of the situation.
In other words, some people looked around and said how come they can work from home? What do I need to do to be able to do that? That is probably a net good.
In regard to the Fed creating money:
I haven’t worked out all of the conceptual details yet, but I think we can and should make a distinction between “real” money and “promise” money. Real money is a true store of value because it is a surrogate for the supply/ demand equilibrium value point in the marketplace at a specific time and place (aka price and wealth).
Promise money is created by banks (and others?) creating debt or loans to do something, basically creating it out of thin air (via account ledger entries) and at that point it has no inherent value surrogacy. Someone promises to pay that money back, plus interest. So as they pay back the loan with “real” money, the promise money disappears and additional real money is also paid to the bank as interest.
But if there is too much promise money it can never be fully converted to real money, and it thereby reduces (or devalues) the net value of the real money already in circulation. As Steve said, that is when we have true economic monetary inflation (not simply changes in prices due to marketplace adjustments in supply and demand). Ultimately, I say it requires “value accounting*” to sort out how and when and where this creation/ conversion/ disappearance of promise money occurs.
I have to believe this idea cannot be original with me and that someone somewhere has already discussed this in greater detail than I have been able to envision it. They may just have used different terminology. Thus I welcome any feedback or constructive criticism about this to extend my thinking in this area.
*We also need to recognize that “value” is subjective and can change with time. This is easily seen in the depreciation in value of autos, but occurs in many places in the economy at different times and places. But overall we want the value of most goods and services to remain relatively stable so the value stored in our real money does not go up or down for most of our expected transactions.
I’m not sure if loans really qualify as promise money, and there is a “time value of money” concept or the “make your money work for you” idea.
Banks are not supposed to lend money they do not have, but they take money someone essentially loans them in the form of savings accounts and promise to make good use of it, in return for an interest rate on that money. To get that interest, they loan it out, collect the interest coming back in, and keep the difference.
Where that really broke down was in the mortgage scams that let banks loan money out to bad debts, have the loan paid off by us the taxpayers, and then we lost our shirts when the loans defaulted, trading the value over time that money should have given us with instant liquid money now by selling the houses at a loss. Of course, certain people got paid and made out like bandits.
Inflationary printed, fiat, non-gold standard money on the other hand, is vaporware in more ways than one and should be named especially.
In theory it’s not necessary but in practice that is the case. The banks collect deposited money, and could just offer loans to that amount. Instead they offer 5-10-20-… times of that. Using the idea that the loans are secured by the things the money is invested in immediately.
That idea actually has a merit to some low multilplier, but not to those that are actually used. On the top of it most responsibility was removed — so the banks were allowed to just not do the only job they have: provide solid risk analysis on the loans they field. When the market in that segment dried up, they extended just lowered the standards. That led directly to the subprime crysis some years later. And most of them were bailed out one way or another. And their associated felons, Moodys, S&P and the other evaluators that just stamped everything got away without even a finger shaked at them. So yeah, everything remains to be filled with helicopter money.
In the old times it was at least visible by the currency losing value in international trade, but after every major player joined this same game even that is not happening.
It took me a long time to learn and understand that banks can create money from nothing; that it is not necessary to have a “solid” commodity backing it, etc.. I am not absolutely positive, but I gather they do not even really need fractional reserves to do that. See for example: http://pragcap.com/mmt-critique this essay is rather long so maybe check out section 5 to see where this idea is discussed.
To repeat what I may have said previously: I now understand money to be basically an agreement between users (and if necessary, the issuer and the user). This “money as an agreement” invention has proven so valuable (in lieu of using or extending barter) that people are inclined to keep using such money even when it is being corrupted because (up to a point) it is more trouble to develop or agree on a new and different form or source of money than what has been used in the past. Even gold has been corrupted by alloying, shaving of coins, claiming vault gold exists that did not exist to back the paper issued in its stead, etc.
I’m sure you can find plenty of thoughts related to your idea on mises.org
Thanks for that heads up on Mises.org. I do need to find the time to look them over more closely.
But I am also looking for more than just “fiat money is bad” and “commodity money is good”. My focus is on just how and when and where is the value that is stored in money created, maintained, possibly converted from “promise” money, and reduced or increased over time.
Quite a few people have mentioned the role that $ or Euros or xyz play as a medium of account. And many folks bring out the benefits of money as an agent of exchange superior to barter. But I have seen less discussion of the value storage role or function, except indirectly when people consider inflation and deflation, or price stability, etc.
I also just recently became aware of this book review: https://affluentinvestor.com/2021/07/book-review-brian-domitrovic-reveals-the-monetary-genius-of-arthur-laffer/ that may help me learn more.
BOOK REVIEW: BRIAN DOMITROVIC REVEALS THE MONETARY GENIUS OF ARTHUR LAFFER John Tamny | On July 19, 2021
If you look for a good book on understanding Money, it’s The Living Money of Mero Laszlo. However according to https://en.wikipedia.org/wiki/L%C3%A1szl%C3%B3_M%C3%A9r%C5%91 there’s no translation.
The beverage curve DRINK!
It’s Five o’clock somewhere
Humans evolved, plus or minus, 250,000 years ago. The Neolithic Revolution was about 12,000 years ago. Rounding off for significant digits, that means about 240,000 years as hunter/gatherers.
The Industrial Revolution was about 350 years ago. So, about 13,500 years as farmers.
The computer revolution started about 80 years ago. Say about 300 years as factory workers.
Tim Berners-Lee breathed life into the Internet about, what, 30 years ago? So that’s about 50 years as standalone computer dusters.
Given this acceleration, it sure looks like the next world-changing event will be coming pretty soon: 20 years? 15 years? 10 years? (I’m betting it’s AI taking over all human jobs, but your mileage may vary.)
What if joining the gig economy only lasts for a couple of decades at most? Then what?
Going to the first comment from Harry Ferguson, I was That Guy in my department back in the 90s. Then we got bought out and my knowledge went down the drain. About seven years later I realized spending the first third of my career in call center management was taking me on a slow but steady dead end careerwise. Luckily being better than average with Excel as my main marketable skill helped me change fields but it was a long, painful search.
Of course, I was lucky my skillset wasn’t one targeted for extinction by Washington, as fields like energy, competent military leadership, small businesses, etc are today
I am coming more to the conclusion that it isn’t a problem, it’s the solution: This crap is a deliberate, slow-rolling insurgency/conquest, and more people are coming to similar conclusions.
They want a civil war, for God’s sake.
I’m going to address what Scott said about how little time it takes to be the elder statesman. I was a programmer talking to someone about their child being in college and them learning so much stuff that is difficult and whether it was relevant to jobs. I pointed out that 90% is probably not relevant to any one job, but could be to another. Also I said if you could learn it, it proves you could learn more. I said that was important, since you typically learn about 10% of what you need for the job in school. For the rest, you find the person who has been there for 10 years or more, that people go to for issues, and normally has a chaotic cubical/desk. Then my brain went “Heloooo!” I then said “Dear Lord, that’s me!” Yup. I had been there for ten years, people came to me for issues, and my desk was chaotic. But I knew where everything was and could find it quickly. Yes, in my past jobs before that, you find that person and you’d learn a lot quickly.
I was a programmer, technician, telephone and server systems administrator. During that time I had a boss for a few years that knew how to get my best.
He gave me a problem to solve, generally with a three or four day deadline, and 90% of the time he got it on time and within his implied budget.
Fixing cars and building houses is fun, but rising to the challenge of something you’ve never done before is just awesome! It damned near killed me after 12 years, but all the same…
And yes, my bench and desk were chaotic, too.
When I had a project, only occasionally was I given a deadline, which I always beat by at least a couple of days. More often I was asked how long it would take. I always beat my estimate by days. I allowed for issues and changes. Big changes would get a new estimate. But in addition to meeting deadlines, padding gives one the aura of miracle worker; you know, like Scotty in Star Trek.
Did your boss ever tell you that he needed warp drive in two minutes or you’re all dead?
Isn’t that the phrase “under promise and over deliver?”
I think those are some of my favorite in the Malicious Compliance reddit threads, where the boss has a fit about something stupid, fires or tries to fire the One Guy That Knows Everything, and then loses his business 6 months later because he didn’t want to have the rules followed.