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Wednesday, July 11, 2018

The coming 'labor shortage' in America is great news for workers

They say "labor shortage" like it's a bad thing.

"America's labor shortage is approaching epidemic proportions, and it could be employers who end up paying," CNBC reported this week. That was before yet another monthly jobs report showing solid growth in jobs and wages.

I always find this framing to be backward. A "labor shortage" is good news: It means it's easier for unemployed people to find jobs, more appealing for people who quit the workforce out of frustration to get back in, and likelier that companies will decide they must pay higher wages to attract talent.

In theory, we could reach a point where upward wage pressure led to an inflationary spiral, with companies raising prices so they can afford to pay higher wages, and those higher prices eating up much of the wage increases. But we're far from that point, with corporate profits still high as a share of the economy.

For now, the "labor shortage" is very good news for workers, and we should root for it to continue.

In a "labor shortage," two key human capital problems in the economy start to fix themselves.



Anonymous said...

Labor shortage?? You mean the lazy ass Millenials don't want to work.

Kick them out of mommies basement and make them work.

Cut off the EBT cards, housing vouchers, welfare and cell phones and I guarantee you those lazy asses will start working.

Problem solved!

Anonymous said...

The writers, and the governments, as well as the MSM talking heads don’t represent the “little people” (goy). They represent the industrialists and bankers.

Labor shortage is bad for the bosses.

Anonymous said...

It is all a lie. There is no labor shortage. There is an overabundance of cheap employers who don't want to pay a livable wage and provide benefits and a surplus of people who just aren't going to be a slave to them anymore

People are tired of living in poverty while their boss is building himself and 1/2 a million dollar barn and telling them there is no money for a christmas bonus while serving them crappy bbq in his newly built barn that is better than them homes of his employees.

Wake the heck up to the fake news. Do the math.

Unemployment ROSE because of those BS figures and ALL those people that they conveniently did not count suddenly are starting to come back on the rolls? WHAT?? Are you kidding me?

It is all a big friggin lie.

Anonymous said...

9:20 is correct.
Many of the employers here on the shore pay little more than 10 to 15 per hour if you are lucky. Many claim to state they are hiring, but in reality they are not. Many of them will hire you only on a temporary basis for maybe a few months, and then let you go when they don't need you anymore. Few employers hire full time. My son is having this problem now. He's not lazy and he is desperately looking for work. Many are very picky and only want to hire you only if you have experience. If you are just starting out will little experience, good luck! Even the low skill fast food jobs are difficult to get hired with. On the shore, it's who you know, and not what you know.

Anonymous said...

Agree with Anonymous 11:52. I have been at one of the Microwave company's for over 20 years and they do not replace employees that have left instead they shuffle the workers remaining to fill the void. Add to that the vast majority of the veteran workers remaining have been on years of pay caps. Some as long as 5 years and counting. There is nothing to motivate throughput and seemingly no concern indicated with management about anything but maintaining their precious profit margins. Keeping labor cost down seems to be the number one priority of our business and probably many others on the shore. Smart business? No. Single minded incompetent profit at all cost blind to what makes improved profits AND motivated employees possible? Oh yeah. The so-called labor shortage around here is joyously self-inflicted.