Who’s to Blame for the Unemployment Rate?

If there’s one thing everybody agrees upon, it’s that the economy is in lousy shape and we’re in serious need of getting more Americans back to work.  And if there’s one thing everbody DISAGREES upon, it’s who exactly is at fault for this current state of affairs!

For those interested in reading some insightful discussion about this problem, I’d steer you to a Wall Street Journal article that was recently brought to my attention (thanks!) by a client of mine.

Why Companies Aren’t Getting the Employees They Need

In this article, Wharton School professor Peter Capelli argues that while the unemployment rate in this country is a tricky and multi-faceted problem, the inflexibility of employers is the element that is most at fault for our current state of affairs.  Here’s an excerpt summarizing his conclusions:

Employers are quick to lay blame.  Schools aren’t giving kids the right kind of training.  The government isn’t letting in enough high-skill immigrants.  The list goes on and on.  But I believe that the real culprits are the employers themselves.  With an abundance of workers to choose from, employers are demanding more of job candidates than ever before.  They want prospective workers to be able to fill a role right away, without any training or ramp-up time.  In other words, to get a job, you have to have that job already.  It’s a Catch-22 situation for workers—and it’s hurting companies and the economy.

He makes a compelling argument, on the surface.  But the plot thickens when you read the more than 400 comments that were submitted under the article, where some very intelligent (for the most part) reviewers of the article chime in and offer their two cents on who is most to blame for the current jobless recovery.  This dialogue puts Karl Marx’s simple bourgeoisie vs. proletariat  argument to shame.  Instead, you’ll find camps pointing to almost a dozen different parties whom they believe deserve culpability for the employment crisis.

Some (inluding the author) blame employers for having unrealistic hiring expectations
Some (especially employers) blame U.S. employees for being lazy, spoiled, and afraid of hard work
Some blame the school system for not producing graduates with the right skills
Some blame immigrants for taking American jobs and intentionally sabotaging U.S. workers
Some blame government for the promulgation of H1B visas and allowing outsourcing to happen
Some blame the unemployment department for providing an overly comfortable social safety net
Some blame unions for insisting on unsustainable wage levels and preventing further hiring
Some blame HR departments for paralyzing the hiring process and overlooking good candidates
Some blame corporate shareholders for demanding short-term returns over long-term growth
Some blame parents for coddling their kids and not preparing them for “real life” work conditions
Some blame society as a whole for demonizing blue-collar and vocational career choices

Honestly, there was so much blame to throw around in the comments section, I stopped counting after a while.  Eventually, it all blended together into something worthy of a Shakesperian tragedy.  But here are a few random highlights from the discussion, if you’re interested:

“Another bearded academic who has never employed (or had to fire) anyone coming up with a ‘touchy feely’ attack on employers.  The number one challenge employers face around the world is motivating current and prospective employees to train and improve their career prospects.  Most people are not motivated to skill-up or re-skill because they either can’t be bothered or they don’t understand we need to constantly upgrade ourselves.   In our organization we used to suggest to employees what training they should do but 9 out of 10 didn’t take advantage of our training programs – several took the days off but didn’t attend the training!”

“‘I have a Masters Degree in Electrical Engineering with 16 years of hands-on experience in my field.  Just because I took seven years off to raise my two children until they went to school full time, I cannot get anyone to at least give me an interview.  The minute they find out I’ve been home with my children they don’t want anything to do with me.  Head hunters have told me this is the reason why they don’t even want to know what I’m capable of doing.  What I know in my field takes years for someone to learn in a job.  I can literally go in, roll up my sleeves, and start producing.  Dr. Capelli is so correct! That there aren’t good candidates in this country is just an excuse to get more working foreign visas granted.”

“The points raised in this article don’t agree with my (our) situation.  We are a small (<25 employees) machine builder.  We operate a machine shop with 6 workers.  One of them is a trainee who started as a general laborer.  We are in desperate need of a CNC lathe operator.  Someone who can not only operate but program the machine.  We are offering the equivalent of a $60k/year wage plus benefits.  The opening has been widely publicized for nearly a month now.  Total inquiries: 2.”

“It really starts with the shareholders.  They always want to have greater earnings compared to the previous year.  This is something that cannot be sustained over a long period of time.  If the shareholders would accept a equal to earnings, or in times of great development, less earnings, then companies would have the flexibility to hire talent and train people. “

“With an abundance of workers to choose from, employers are demanding more of job candidates than ever before.  On the other side of this are employees who won’t just accept any job they want a ‘good’ job.   An article last week in the WSJ pointed out that there is an abundance of homes to choose from, but home buyers cannot find the home they want.  Buyers are demanding more and the homes on the market do not match with their expectations so they stay on the sidelines.  In housing, loans, stocks, and employment buyers expect to get more for their money because of the recession.  When do those who can buy stop waiting and wasting time looking for the perfect home, the perfect trade, the perfect employee, or the perfect loan and all the other perfect buys they desire to make?  They will capitulate when they see prices going up and they start to believe they are being left out.  We are getting closer to this inflection point.”

“What a crock of blankety-blank from these cry-baby executives.  Many of them can’t manage their way out of a wet paper bag and/or make repeated bad decisions, but they blame their employees or use their political connections inside the organization to avoid the terminations they so richly deserve and have earned.  To cover their mistakes, they then lay off a couple thousand people to cover the financial disasters the executives themselves caused.”

“Did anybody consider the possibility that the skills vacuum could be because nobody in the USA wants to pursue the personal development of skills that have been commoditized and outsourced?  It would be considered futile to invest in learning new skills for jobs that will just be handed off to someone overseas.  Even if you can do it five times smarter, they can do it ten times cheaper.”

“Lower the minimum wage or just get rid of it.  That will start hiring and create competitiveness that build better skills and income.  I refuse to hire someone without the basic skills like reading, comprehension, spelling, and grammar that they should have learned in primary school.  The public schools have destroyed our children.”

“Let’s not forget the tremendous grade inflation.  Back in the day when I graduated from college, you really had to earn your grades.  The majority of students were B-/C+ students.  It was common for schools to grade on a C-Curve.  Today, it seems like every new grad has a 3.995 GPA.”

“I can’t deal with these multi-tasking googling tweeting young know nothings.  Always too smart to do the real work and with too much attitude to take a hint.  And unfortunately too busy broadcasting themselves to the rest of the world instead of figuring out a tough assignment.”

“As a business owner, I don’t have time to coddle prospective employees.  One guy we interviewed, when asked what he had been doing since last employed (over 30 months), said he had been doing a lot of fishing, hunting, sailing and working on his motorcycle.  Not exactly the type of personal investment in activities that would improve the skills that would have made him more apt for the job he was applying for.  To make matters worse, in the 26 years working in industry, he had not once taken the individual initiative to improve his knowledge or skill-sets.  He had indeed however, honed his leisure activities well enough to – in his words – be pretty good at them.  Individuals need to take some personal responsibility for knowledge and skills before laying it off on others.  Be an adult, and act like one.  As for Academics, they seem to have all of the answers. Problem is they don’t employ anyone nor do they have to spend their day mired in one regulation after another.”

Again, this is a sampling of the comments submitted, showing you how many points of view there are on this issue and how complex of a matter we’re facing as a country.

My challenge to the individual job hunters reading this blog?  Assign long-term blame for this problem, if you must, in the context of forming your voting decisions and trying to fix some of the big-picture problems we’re facing as a country.  But lay aside blame in the short-term, in the context of getting a job.  It’s counterproductive.  If anything, I’d study these types of arguments carefully to fully understand how employers and business owners today view the issue of hiring — even if you disagree with them — since the more you can empathize with their concerns, right or wrong, the better you’ll be able to sell yourself to them for a viable job opportunity.

That’s the ticket for pragmatic career survival, in any economy.

P.S.  For even more thoughts on this latter point, check out another outstanding article called Show Them That You Really Want the Job written recently by David Perlmutter in the Chronicle of Higher Education.  It again points to how the hiring process looks from the employer’s perspective and how savvy job hunters can capitalize on this reality…

2 Responses to “Who’s to Blame for the Unemployment Rate?”

  1. Matt – Great article and perspective. I published a similar article a few months ago which addresses similar issues you raised. It can be read at:

    I observed several common threads in your post.
    First – all the reasons give for the paradoxical current high unemployment with similtaneous shortages of workers are correct. Nearly every reason give is true. We have great employers struggling to find qualified workers and other employers who believe high unemployment means they have the upper hand. On the employee side, the example given of the engineer + mother is typical. While this person might have all the skills, the definition of work has changed. It’s a different workplace than the one she left 7 years ago. She may have the skill fit but what about culture? What about her technology skills? What about the ability to work on virtual teams? And that’s part of the problem – 30 and 40 years ago you could drop out of the workplace for 20 years and jump back in where you left. Today, skill requirements change so quickly that a year or even months could date an employee’s skill set.

    I coined the term Perfect Labor Storm (www.perfectlaborstorm.com) in the late 1990s to describe the multiple factors converging to create a skilled worker shortage. Your article does a brilliant job of confirming that the cause of high unemployment and skilled worker shortages is a complex problem, complicated by the multitude of root causes.

  2. Matt, if I may share a favorite quote, “The best years of your life are the ones in which you decide your problems are your own…you realize you control your own destiny.”

    Quote borrrowed from Albert Ellis
    Blame has no winners.

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