Tuesday, November 15, 2011

Some thoughts on work

I've seen a lot of good stuff on labor/skills shortages/skilled labor issues recently and was going to share a few random musings. I don't endorse all of this stuff (I'm generally skeptical of general shortage claims), but it's worth chewing on:

- First, there's been some good discussion of returns to different majors. I haven't had the time to look at this stuff in detail -there's a lot of self-selection in this sort of thing so I hope everyone is citing good studies that take that into account. This was a particularly interesting post on STEM (science, technology, engineering, and mathematics) degrees by Arnold Kling. I don't endorse the "STEM shortages" claim, but I do think this post and the links in it have some interesting material on grade inflation and college major choices.

- Granted, you have to be careful when you say you don't endorse the STEM shortages claim, because some people then want to lump you into the Lou Dobbs crowd. I've met and had conversations with both Ron Hira and Norman Matloff (both interviewed here by Lou Dobbs). I'm often sympathetic to Ron's high-quality work on the H1-B (although I don't agree with all the policy conclusions he draws from it). I have much bigger problems with Matloff's claims. One of my problems with this video is that they jumble a lot of different labor markets. I do think there are big problems with the post-doc labor market. I think there are trends in the labor market for software engineers that are definitely unfortunate for software engineers themselves. But I don't think you can look at gluts or dynamics in these very unique fields and make broader claims about how we have more than enough skilled workers.

- So I am not a "staple a green card to their diploma" STEM shortage guy, but I'm also not a "we're flooded with foreign labor and Americans will never do science" guy. Another prototypical position to take in this whole debate is the "forget the scientists - we need more skilled blue collar workers" position. Like the other positions, I think there's a grain of truth to this but I can't endorse it completely. We do under-invest in mid-level skills in this country. We have a bifurcated education system with a lot of four year degree liberal arts majors (which is fine - civilized society needs liberal education) that we put a lot of money into on the one hand, and a lot of high school grads, GED holders, and dropouts that need more investment in their human capital on the other. We know solutions that work - apprenticeships, community college, career and technical education. Some of these are on the rise, which is good - some aren't. If there's any truth to the "skills shortage"/"skills mismatch" story it's on these jobs with these skills. Technical, high-value work that does not require a four year degree. Mike Rowe has a great promotion of this issue here (again, I can't endorse everything he says about skills gaps, etc. - but he's focusing on important issues despite those disagreements that I'd have... and yes I'm actually embedding Mike Rowe's video but not Lou Dobbs because I like Rowe decidedly more than I like Dobbs):

- Finally, because the science and engineering labor market holds special interest to me, I've always been interested in the compensating wage differentials literature - a factor that I think for obvious reasons plays a huge role in this market. I was reading some of Einstein's essays last night, and I came across this great passage that really highlights why compensating differentials are so important when we think about scientists. He writes:

"The most important motive for work in the school and in life is the pleasure in work, pleasure in its result and the knowledge of the value of the result to the community." (from "On Education", 1936)

I (obviously) think one of the chief determinants of work is the monetary compensation received for that work and the marginal productivity that firms get out of purchasing labor. Einstein has not swayed me from this view. But I strongly agree with Einstein that that is not the full extent of our relationship with work, and in scientific jobs particularly, there are often motives much broader than earning an income that have to be considered.

Those are some scattered thoughts - I've been thinking about the STEM labor market recently because I'm getting ready to write an application for an IHS fellowship discussing the market for scientific labor. As I've said before - the market works. There's no real evidence of doomsday shortages. There are all kinds of interesting dynamics and adjustment processes in this specialized labor market - and lots of implications for growth and sustainability in general. There's lots of fascinating stuff for an economist to talk about. But the sky-is-falling mentality that a lot of people have is simply not justified.


  1. Three thoughts:
    1) A necessary precondition for the Einstein quote, or any of the various permutations of "Do what you love, and you will never work a day of your life." is that this that you can drive enough revenue doing it to live as you wish. A huge disconnect that I see is the naive pursuit of things that one loves with the expectation that it will afford that person a nice house and a BMW.
    2) I have no sympathy for twenty somethings with degree in BA in X, $100k in student debt, no marketable skills, and who are unwilling to work an entry level job. There are jobs, and there are hobbies. Very few people are lucky enough to have some overlap between the two. I expect that we will see a reduction in college attendance as a result of the crushing burden of student debt we see right now, as parents figure out that a BA in Random is not any more valuable than a stint in the National Guard or three years of freelance studying of art in Paris while living with friends for $500 a month.
    3) You can get a newspaper from any era, and it will have stories of doom and gloom just around the corner. The Sky Has Been Falling forever.

  2. I will not deny that foreign students can be bright, but faculty exaggerate their brilliance because foreign students are servile in doing work and favors for faculty and not demanding that professors actually earn their tuition keep. Morevover, faculty like that foreign students are either afraid, complicit or morally ambivalent about the imoral behavior of professors. In many cases they are more likely to share the professors' anti-Americanism than American students.


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