Businesses say they can't find qualified workers. Are they right?

[rousseau]

I wonder if the more accurate claim is that businesses cannot find qualified candidates at the offered compensation.

In my field (software) most companies are looking for exceedingly skilled people which are in chronic short supply. Those who are skilled enough to get a high wage are usually already employed.

Perhaps, but a shortage indicates that the amount people wish to purchase at the market price exceeds the amount people are willing to sell. If there is truly a shortage for people with characteristics X, then the market compensation is too low for those people. Raising compensation in this instance sends two messages. First, it may induce more people to offer their services over time. Second, it may induce firms to reconsider their structure and needs and find alternative methods to achieve their goals.

If firms are cannot find people with the desired qualifications at the offered compensation, it is a market signal to those firms that their expectations are unrealistic at the offered compensation.

Yea, that's true. But it also may be true that these small businesses simply can't afford to pay more but also can't find the skills they need at what they can afford, meaning supply is not meeting demand. Maybe their expectations should be lower, but maybe lower expectations are not workable solutions. That would be the problem they face.

 

[ksen]

Yea, that's true. But it also may be true that these small businesses simply can't afford to pay more but also can't find the skills they need at what they can afford, meaning supply is not meeting demand. Maybe their expectations should be lower, but maybe lower expectations are not workable solutions. That would be the problem they face.

Then they're in the wrong business.

 

[coloradoatheist]

i wish the survey authors would try and investigate more, and dive more into what is wanted and what is missing. Businesses can't be too long without essential jobs so they would either need to hire and train, or hire. Or as rousseau talked about with software engineering, hiring someone that can't do the job may be worse than not hiring if you spend more energy trying to fix the mistakes.

Although I think there's something to be said for hiring people with little experience but a little bit of brains behind them. I went out on co-op last year for 8 months, my first time in industry, and for the first while I was nearly useless and oblivious, but after about four or five months I reached an intermediate level, and was outperforming some of the senior devs. That kind of productivity comes once you've had an excess of exposure to a businesses internal systems and processes, and is something any developer is going to have to go through, junior or senior, when faced with a new technology. In fact, after 6 months on the job I was training a guy who had been in the field for two decades.

So if companies can switch their focus to smart people, not experienced people, they'll likely gain some great employees. The problem comes when you pick up people with no ability to learn or problem solve.

It also depends on how long a company has to train, and the resources they have to train with. For some jobs it could take months to do it and at the same time you are losing the productivity of the person who is training. I think there needs to be more study into what positions/fields/jobs that they can't find for.

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Yea, that's true. But it also may be true that these small businesses simply can't afford to pay more but also can't find the skills they need at what they can afford, meaning supply is not meeting demand. Maybe their expectations should be lower, but maybe lower expectations are not workable solutions. That would be the problem they face.

Then they're in the wrong business.

The problem is when it's not their area of expertise. A laundry business isn't going to know how to do DBA work, or website development.

 

[rousseau]

i wish the survey authors would try and investigate more, and dive more into what is wanted and what is missing. Businesses can't be too long without essential jobs so they would either need to hire and train, or hire. Or as rousseau talked about with software engineering, hiring someone that can't do the job may be worse than not hiring if you spend more energy trying to fix the mistakes.

Although I think there's something to be said for hiring people with little experience but a little bit of brains behind them. I went out on co-op last year for 8 months, my first time in industry, and for the first while I was nearly useless and oblivious, but after about four or five months I reached an intermediate level, and was outperforming some of the senior devs. That kind of productivity comes once you've had an excess of exposure to a businesses internal systems and processes, and is something any developer is going to have to go through, junior or senior, when faced with a new technology. In fact, after 6 months on the job I was training a guy who had been in the field for two decades.

So if companies can switch their focus to smart people, not experienced people, they'll likely gain some great employees. The problem comes when you pick up people with no ability to learn or problem solve.

It also depends on how long a company has to train, and the resources they have to train with. For some jobs it could take months to do it and at the same time you are losing the productivity of the person who is training. I think there needs to be more study into what positions/fields/jobs that they can't find for.

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Yea, that's true. But it also may be true that these small businesses simply can't afford to pay more but also can't find the skills they need at what they can afford, meaning supply is not meeting demand. Maybe their expectations should be lower, but maybe lower expectations are not workable solutions. That would be the problem they face.

Then they're in the wrong business.

The problem is when it's not their area of expertise. A laundry business isn't going to know how to do DBA work, or website development.

And then when they're looking for that perfect employee they're wasting money too. It doesn't seem to be an easy game getting competent people on your team.

 

[rousseau]

Yea, that's true. But it also may be true that these small businesses simply can't afford to pay more but also can't find the skills they need at what they can afford, meaning supply is not meeting demand. Maybe their expectations should be lower, but maybe lower expectations are not workable solutions. That would be the problem they face.

Then they're in the wrong business.

And there's the paradox of running a small business. You need more people to take on more work that would get you the money to take on more people. If the costs of getting more people are too great it's impossible for the business to grow.

 

[coloradoatheist]

And then when they're looking for that perfect employee they're wasting money too. It doesn't seem to be an easy game getting competent people on your team.

Agreed. Which is why they are either trying to find non-essential employees, or their jobs are covered by other people. But it's also the argument against H1 Visas. Companies have to save a lot for them, or the skills that are needed aren't around.

 

[ksen]

Yea, that's true. But it also may be true that these small businesses simply can't afford to pay more but also can't find the skills they need at what they can afford, meaning supply is not meeting demand. Maybe their expectations should be lower, but maybe lower expectations are not workable solutions. That would be the problem they face.

Then they're in the wrong business.

And there's the paradox of running a small business. You need more people to take on more work that would get you the money to take on more people. If the costs of getting more people are too great it's impossible for the business to grow.

Then you should be charging more or reducing your profit expectations until you can get a competent team in place.

 

[rousseau]

Yea, that's true. But it also may be true that these small businesses simply can't afford to pay more but also can't find the skills they need at what they can afford, meaning supply is not meeting demand. Maybe their expectations should be lower, but maybe lower expectations are not workable solutions. That would be the problem they face.

Then they're in the wrong business.

And there's the paradox of running a small business. You need more people to take on more work that would get you the money to take on more people. If the costs of getting more people are too great it's impossible for the business to grow.

Then you should be charging more or reducing your profit expectations until you can get a competent team in place.

Yea I think that's typically how it works, or the entrepreneur/stakeholders in question bust their ass until it works.

 

[Nice Squirrel]

Many good points in this thread. Right now there is wage suppression due to the recent recession. I cannot find similar work without a Masters, and 12 years of progressive biochemistry.

 

[coloradoatheist]

Many good points in this thread. Right now there is wage suppression due to the recent recession. I cannot find similar work without a Masters, and 12 years of progressive biochemistry.

Which is one of a couple things. There was a signal to enter that career choice and now it has too many people. Or possibly it was overpaid in the past. In the late 90s/2000s there was certainly overpaid IT professionals.

 

[ksen]

Overpaid according to whom?

 

[coloradoatheist]

Overpaid according to whom?

Overpaid to what skills and experience they had coming into it. If you can say people are underpaid, then people can be overpaid too.

 

[Nice Squirrel]

And besides the market, how do we determine who is over or underpaid?

 

[coloradoatheist]

And besides the market, how do we determine who is over or underpaid?

Then you can't make the argument that people are over or underpaid. They are paid what they are.

 

[Nice Squirrel]

And besides the market, how do we determine who is over or underpaid?

Then you can't make the argument that people are over or underpaid. They are paid what they are.

Really? If 1000 laundresses make $35/hr ea and you hire one at $335/hr, would that one be overpaid?

 

[ksen]

Overpaid according to whom?

Overpaid to what skills and experience they had coming into it. If you can say people are underpaid, then people can be overpaid too.

Overpaid according to whom?

 

[coloradoatheist]

And besides the market, how do we determine who is over or underpaid?

Then you can't make the argument that people are over or underpaid. They are paid what they are.

Really? If 1000 laundresses make $35/hr ea and you hire one at $335/hr, would that one be overpaid?

But then who's making the claim the one who got paid $335/hr is overpaid? It's the same thing. You and I can make the claim.

 

[Bronzeage]

And besides the market, how do we determine who is over or underpaid?

Then you can't make the argument that people are over or underpaid. They are paid what they are.

Really? If 1000 laundresses make $35/hr ea and you hire one at $335/hr, would that one be overpaid?

Sometimes an absurd example helps an argument, but this one does not.

If there were only one laundress and this one could do the work of 1000, why wouldn't the pay be $335/hr? Does the value of clean clothes drop simply because labor becomes more efficient?

 

[ksen]

And besides the market, how do we determine who is over or underpaid?

Then you can't make the argument that people are over or underpaid. They are paid what they are.

Really? If 1000 laundresses make $35/hr ea and you hire one at $335/hr, would that one be overpaid?

Sometimes an absurd example helps an argument, but this one does not.

If there were only one laundress and this one could do the work of 1000, why wouldn't the pay be $335/hr? Does the value of clean clothes drop simply because labor becomes more efficient?

If you're an MBA idiot you think it does. Or how else would you describe the delinkage between productivity and wages?

 

[funinspace]

Overpaid according to whom?

Overpaid to what skills and experience they had coming into it. If you can say people are underpaid, then people can be overpaid too.

LOL…in some ways I’d have to agree. The Dot-Com bubble was distorting many things, including IT wages for a number of years. Along with that, CEO compensation could reasonably be argued is way over the top. Politics and governments can distort wages in various ways as well.