2012 November 25 Sunday
Skilled Worker Shortage In Manufacturing An Illusion

A great article by Adam Davidson in New York Times Magazine shows just how low the pay is in supposedly skilled manufacturing jobs. Low wages mean no labor shortage.

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.

The McDonald's job is probably more secure than the manufacturing job too. In the last 20 years employment of high school drop-outs in manufacturing has dropped in half (see next link). As manufacturing equipment becomes even more automated the prospects for assembly line workers will get even worse.

Only engineers and software developers should go into manufacturing in order to program the design and manufacturing software. When manufacturers are starting people at $10 per hour the only reason to go into manufacturing is if you have no other option.

What I do not understand: what are the least skilled people going to do in 20 years? Anyone have a good guess?

Since manufacturing jobs are now paying near minimum wage level isn't it time we end the practice of letting in large numbers of immigrant low-skilled workers, legal or illegal? Isn't it crazy to pretend we need more low-skilled workers? The unemployment rate for high school graduates is nearly triple that of college graduates.

Among Americans aged 25 to 34—the youngest group that would have completed college under a traditional schedule—the unemployment rate for bachelor's degree holders was 4.1%, versus 11% for those with only a high-school diploma and 9.8% for those who began college but didn't finish.

High school drop-outs are at 12.2% unemployment. These numbers underestimate the differences in employment rates due to lower labor market participation rates and higher prison participation rates among those with lower IQ scores and educational attainments.

Share |      By Randall Parker at 2012 November 25 01:19 PM 

asdf said at November 25, 2012 7:09 PM:

At some point a libertarian realizes that there are like 6 billion poor people in the world and letting them all in would be a disaster. He either then becomes some kind of conservative who takes a pragmatic approach to things, or he becomes disastrously committed to libertarian orthodoxy no matter how terrible the real world effect.

Randall Parker said at November 25, 2012 10:14 PM:


What amazes me is just how much realism has lost hold on the mainstream of American political life. You might that stagnant and declining living standards for the bottom half would be enough to wake up people. But no.

asdf said at November 26, 2012 5:14 AM:

It isn't surprising. Voting doesn't actually affect policy. It's just status signaling. People want to signal they are high status by supporting feel good but loopy policies.

Brendon Carr said at November 28, 2012 8:00 PM:

Re: "What are the least skilled people going to do in 20 years?" Simple. They're going to kill us and take our shit. America has, for the last 20 years that I've been aware, advanced an official line that those who have more stuff have stolen it from those who have less. When they come to have nothing and believe it's because we stole from them, violence will be inevitable.

lImIl said at December 1, 2012 5:36 AM:

They will just continue to take whatever evil policies the politicians implement and think it's in their own interest to spend the nights in a crowded homeless dormitory.

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