In the News

Unemployment is high not because businesses are shedding jobs but because no one is hiring

New Yorker has a terrific one-page summary by James Surowiecki of why so many job vacancies are left unfilled “for want of any sufficiently qualified candidates” while so many people (especially young people with university degrees) are unable to find work. It’s behind a pay wall, so here’s a synopsis:

  • Unemployment is high not because businesses are shedding jobs but because no one is hiring (in one case cited, a company had 25,000 applicants for a standard engineering job, and rejected all of them).
  • The idea of a “skills gap” (the unemployed don’t have the skills hirers are looking for) is a myth. The truth is that companies want to hire the most experienced and successful people already working at competing companies, so they’ll hit the ground running, so there’s no training cost, and so there’s no risk they won’t work out. “When companies complain they can’t find people with the right ‘skills’”, Surowiecki writes, “they often just mean they can’t find people with the right experience”.
  • This is a direct consequence of the fact that large corporations have slashed internal training budgets as a short-sighted means of cost cutting. The argument, says Surowiecki, is that “job tenure has shrunk, so why spend time and money training somebody who may soon go to work for your competitor”. With the loss of benefits and the disinterest of employers in investing in their employees, employee loyalty has understandably plummeted, creating a vicious cycle that big corporations themselves are to blame for.
  • In a weak economy, “companies worry less about getting every possible dollar of new business than they do about keeping costs down”. The unwillingness of big corporations to invest in genuine domestic production (in lieu of outsourcing and offshoring every possible job) is a direct contributor to that weak economy. But it also reflects the fact that big corporation CEOs realize the economy is on the verge of collapse, and they’re hoarding cash and slashing costs to prepare for that eventuality…

via More Years of Schooling for Fewer and Fewer Jobs « how to save the world.

Original article:

Discussion

8 thoughts on “Unemployment is high not because businesses are shedding jobs but because no one is hiring

  1. we like to honor many other pages on the Internet, even if they aren’t linked to us, by linking to them. Under are some webpages worth checking out

    Posted by Why Plan Promenade Party | July 15, 2012, 7:56 pm
  2. nice site.

    Posted by Denice | July 16, 2012, 8:36 am

Trackbacks/Pingbacks

  1. Pingback: Why Black Unemployment is high – Few Links To Corporate America « Job Market Monitor - July 16, 2012

  2. Pingback: Job Club – Because You Only Need One Job « Job Market Monitor - July 16, 2012

  3. Pingback: Is America falling behind in the skilled worker race? – Global Public Square – CNN.com Blogs « Job Market Monitor - July 20, 2012

  4. Pingback: The Skills Gap Fallacy « Job Market Monitor - July 20, 2012

  5. Pingback: US – Skills Gap a Myth? « Job Market Monitor - July 26, 2012

  6. Pingback: Life after unemployment checks run out « Job Market Monitor - August 3, 2012

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

Jobs – Offres d’emploi – US & Canada (Eng. & Fr.)

The Most Popular Job Search Tools

Even More Objectives Statements to customize

Cover Letters – Tools, Tips and Free Cover Letter Templates for Microsoft Office

Follow Job Market Monitor on WordPress.com

Enter your email address to follow this blog and receive notifications of new posts by email.

Follow Job Market Monitor via Twitter

Categories

Archives

%d bloggers like this: