BS: Job Market Debate

Subject: BS: Job Market Debate
From: sciencegeek
Date: 04 Jan 14 - 11:01 AM

Saw this news item: http://enews.earthlink.net/article/bus?guid=20140104/73236dae-a5a1-45f6-8402-8ce67279bd1d

"We all cannot believe that we have been fighting this theory for more than 150 years," said April Yanyuan Wu, a research economist at the Center for Retirement Research at Boston College, who co-authored a paper last year on the subject. (An employed academic, I might add.)

The theory Wu and other economists are fighting is known as "lump of labor," and it has maintained traction in the U.S., particularly in a climate of high unemployment. The theory dates to 1851 and says if a group enters the labor market — or in this case, remains in it beyond their normal retirement date — others will be unable to gain employment or will have their hours cut.

Still, many remain unconvinced. James Galbraith, a professor of government at the University of Texas at Austin, "I can't imagine how you could refute that. The older worker retires, the employer looks around and hires another worker," he said. "It's like refuting elementary arithmetic."

If all jobs were equal and close at hand, I'd agree with Wu... but in the real world, choices are much fewer and not always practical.

what do you guys think?

Subject: RE: BS: Job Market Debate
From: JohnInKansas
Date: 04 Jan 14 - 09:50 PM

The article linked, Will surge of older workers take jobs from young? gives sufficient argument against the theory for anyone familiar with reality.

If one wishes to limit "new entry level jobs" to "service" and "sales" jobs where wages are so substandard that only old people who also receive retirment/social security can survive there, it's possible that there's some truth in the idea. For skilled jobs, requiring some education, it generally takes five years for the experienced employees to pass on the "company specific" requriements of a job to achieve "usefulness" by the newby, and ten for the new hire to become as competent as the "teacher" was, - by which time the teacher should have progressed so that they both can move along.

Without an opportunity to "mature into the job," which requires the presence of and assistance from more senior workers, the whole economy is stagnated, and you get nothing but iPods, games, apps, cloud computing, Big Data, CRM, "salesmanship" and the like.

John

Subject: RE: BS: Job Market Debate
From: GUEST,Stim
Date: 05 Jan 14 - 02:01 AM

Actually, even in this job market, a lot of those jobs that older, experienced workers leave are unfilled because employers can't find other older, experienced workers to fill them.

Subject: RE: BS: Job Market Debate
From: GUEST,LynnH
Date: 05 Jan 14 - 04:08 AM

As a rule of thumb, if you're over 40 you're unemployable- and my experience, being made redundant at 58, tends to bear this out.

A lot of employers feel that they need to rejuvenate their workforces and with generous severance packages persuade their older, experienced workers to take early retirement. Now, in many cases, they're begging people to come back.

These flash, glib theoreticians from business schools and economics faculties have a lot to answer for.

Subject: RE: BS: Job Market Debate
From: DMcG
Date: 05 Jan 14 - 05:23 AM

The article linked ... gives sufficient argument against the theory for anyone familiar with reality

I didn't find that so, myself. Yes, there were arguments, but there were a lot of assumptions behind the arguments that to me didn't stand up to too much scrutiny. But let's rephrase the argument a little. Hypothesis: Retaining the older staff has no impact on the employment opportunities of new entrants. Extremely unlikely, I would say, because it could only be true if opening that vacancy led to the loss of a vacancy elsewhere, such as in the restaurants mentioned. So in terms of employment I would say there must be a cost, even if it is not 1:1, which a naïve interpretation of the theory would suggest.

Then, in most countries in Europe - and maybe the US but I don't know enough about it - what you save on paying pensions you may well spend on Jobseeker's allowance, housing benefit, .... so when we think of employment we need to be thinking wider than business interests.

However, the discussion is about economics, not employment, so things are a little subtler, and I understand John's point that you cannot typically replace a long serving employee which knowledge of the business with an outsider who has no experience of the building. But it would be a foolish business - of which there are unfortunately plenty - who would try and do that. Instead, promote intermediates to draw on their experience. Of course, this requires businesses to think about succession planning and things like that, which too many see as overheads. But failure to do so by keeping older staff is short-termism at its worst: instead of a planned handover of skills from the older workers to less experienced staff, you keep Joe until he drops dead on the way to a meeting in a completely unplanned fashion, taking all his skills and experience with him and leaving no-one trained to take over.

Subject: RE: BS: Job Market Debate
From: sciencegeek
Date: 05 Jan 14 - 06:53 AM

The article stated that they had based it partly on academics looking for work... hardly the most common employment anywhere.

I've worked in the "real world" and "civil service" the past 40 years... not to mention having a husband who worked in manufacturing jobs.

In civil service we are actually prevented from hiring a new person until the person that they replacing is long gone... can't even post the job listing until we get approval from civil service based on what the politicians decide how many people they want on the payroll. And we generally can't hire from just anyone... only those who have taken, passed and scored high enough on the tests to be interviewed. A lot of us "short timers" are doing what we can to pass on our experience to our co-workers to prevent "bureaucratic altzheimers".   

What I see is older workers staying on because they can't depend on their pensions being there in the future and Tea Party millionaires regarding Social Security a parasitic blight on the economy... forgetting that no income no economic growth, you can't spend what you don't have. And for mobile, single income families - they have a better shot if they can relocate... but young families that need two incomes can't just split up to seek new jobs... there is a social need to be addressed here.

I don't live to work (aka "for my job")... I work to have enough income to live the kind of life that I want to live, making compromises along the way.   

What I have also seen is short sighted business practices that do not regard their employees as people with value... merely as pawn to be used and discarded, while the upper management exploits the company for every dime they can...

Subject: RE: BS: Job Market Debate
From: sciencegeek
Date: 06 Jan 14 - 07:15 AM

I googled the source for the article, Center for Retirement Research at Boston College, and it does seem to have a definite slant to its research. So I wonder if this is due to the director or possible major donors to the research... a not unheard of situation.

What concerns me is the right wing idea that 70 should be the new retirement age... which is fine for those well paid CEOs that have no intention of ever leaving their "thrones" anytime soon, but means that the average schmoe is expected to work for low wages, poor benefits and a retirement that will limited to their declining years.

If you don't agree then here is the bad news: 78.64 years (2011)
United States of America, Life expectancy.

If Social Security is underfunded, raise the limit on income contributions.... it hasn't been adjusted to inflation for years.. there is the first place a real economist would be looking, unless there is another agenda involved.

Subject: RE: BS: Job Market Debate
From: GUEST,sciencegeek
Date: 06 Jan 14 - 09:24 AM

"Actually, even in this job market, a lot of those jobs that older, experienced workers leave are unfilled because employers can't find other older, experienced workers to fill them."

Part of the reason for this is that our educational system is not geared to teaching skills...

Point: if you go to a community college that even teaches manufacturing skills... the equipment is so out of date that the graduate has no usable skill to market... their only "skill" is the hope that they can read & follow directions and are trainable.

Big business gains the advantage where there are more workers than jobs... they use this & the treat of sending jobs overseas to break unions or offer wages that are barely above the poverty level. We were warned about the trend towards corporate feudalism decades ago... no big surprise that it's here.

Subject: RE: BS: Job Market Debate
From: GUEST,Stim
Date: 06 Jan 14 - 08:02 PM

"Part of the reason for this is that our educational system is not geared to teaching skills..."

Not really...manufacturers have always trained people to make their products. And there are way fewer manufacturing jobs than ever. And what with all the "here to day, gone tomorrow" technology, the only skills that last are the "people skills", which, combined with the williness to learn, are skills that most employers value the most.