Sunday, July 22, 2018

Labor Shortages


The problem of US labor shortages is overstated. The US labor force is more than capable of filling the manufacturing jobs that should be coming back from overseas. Engineering jobs have been slowing down since 2000 and many of these jobs that were decimated after 2008. The culprit is bad trade policy and bad tax policy and it will take a while before these jobs are restored to the levels we saw in the 1960s to 1980s.

Businesses are ramping up after a decade of low activity. This has happened before.  Engineers were in high demand from the 1980s to 2000 and then declined severely. 

Design work follows the design cycle one business or one industry at a time. A design cycle can last from 1 to 2 years depending on the product and if other products are also upgraded, then engineers can finish one product and join the design team for the next product. 

From 1980 to 2000, the electronics, PC, defense and telecom product upgrades dominated these decades. But most of these engineers haven’t done engineering work for 20 years and many have retired.  In the meantime, the US has not had a resurgence of engineering hiring, until now.  The off-shoring of manufacturing from 1993 to present decimated engineering jobs in the US for the past 20 years. So, why is it a surprise that companies can’t find engineers?

The engineering jobs listed on the job boards are spread all over the US and include the normal engineering openings, but there is no sign of the type of industry product upgrades we saw in the 1980s. Engineers prefer to live in larger cities that have a lot of engineering jobs. They look for jobs that match their interests and experience.

The industries that need to upgrade their equipment includes electric utilities who need to strengthen their grids and counties need to rebuild their aging water and sewer systems.

The industries that need to upgrade their capabilities include IT cyber security, government, healthcare and education to become more efficient and lower costs.


After 2008, workers were forced into service jobs and are now leaving those jobs to move into more lucrative fields. That creates labor shortages in these service companies.

Those service jobs that are minimum wage jobs in fast food, restaurants and retail should give these jobs back to the teenagers.

Smart businesses with specific needs are setting up specific training at community colleges. Temp Services have also been effective to staff up.

In the 1980s, the electronics manufacturing companies were ramping up in several cities and we used community colleges and temp services to find permanent employees and it worked.  There is no reason it can’t work today in 2018, but business hiring is now spread all over and is not in concentrated areas.

Construction jobs peaked in 2006 at 5.8% and fell to a low of 4.2% in 2010. It was back up to 4.6% in 2016. Most construction workers in the US in 2006 were illegal immigrants. They built millions of new homes from the 1980s to 2007. When residential home construction stopped in 2008, they left construction.


Norb Leahy, Dunwoody GA Tea Party Leader


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