Eric Ruark's picture


  by  Eric Ruark

“Blue Collar Worker Shortage Turns U.S. Labor Market on Its Head” read the headline on a December 13 Bloomberg article. It was filed under the “Economics” section of the site, so one must assume the writer, Rich Miller, has a passing understanding of the field, which would include understanding what a actual labor shortage is.

Alas, here is Miller’s lede:

A surprise shortage of blue collar workers is changing the contours of the U.S. labor market, boosting their pay, narrowing wage inequality and drawing more women into those jobs.

Just as members of the corporate media have decided to call illegal aliens “undocumented immigrants” and refer to an amnesty unattached to any enforcement provisions “immigration reform” (“comprehensive” is added when increases in legal immigration and guest workers are attached to the amnesty), they now use the term “labor shortage” not to mean a lack of available workers, but instead to describe an abundance of available workers employers would rather not hire.

In economics, the term “shortage” refers to a situation wherein the demand for a good or service exceeds the supply. The situation wherein the supply of a good or service exceeds demand is a “surplus.”

If there were a labor shortage in the United States, wages would be skyrocketing, and many employers would immediately go out of business being unable to operate without a sufficient workforce.

There is dispute over the relative health of the U.S. economy, the competency of the Fed, and what has caused turbulence in the stock market over the last few months. There are differing views on what are the best economic policies for the United States to pursue. It is ludicrous to claim that there is a labor shortage in America.

Think about it this way. Landscaping is one of the sectors in which employers are constantly clamoring for more guest workers and hiring large number of illegal aliens. Owners of landscaping companies say there is a shortage of available workers. Yet, who in America is unable, if they chose, to hire a crew to mow their lawn?

Some people choose to mow their own lawns, but the fact that one can contract with a landscaping company to have one’s lawn mowed relatively cheaply has made that a common practice today, certainly compared to thirty years ago. It used to be that if homeowners hired someone to cut their lawn, it was usually an enterprising teenager who was paid a lower rate than that commanded by a professional landscaping crew. Immigration has lowered the price of landscaping and put enterprising teenagers out of business (who can now while away their time playing Fortnite).

One may argue that the whole point of mass immigration is to lower labor costs so that Americans can afford to outsource certain tasks and spend their time on more productive pursuits, say binge watching the latest Netflix series (or playing Fortnite.)

The reality is that the “benefit” of cheaper labor due to immigration means that millions of Americans suffer displacement and lower wages. The effect is especially pronounced in lesser-skilled jobs, though we also see this trend in the tech sector through the employment of H-1B and L guest workers, and the OPT program.

Devaluing the price of labor to such a degree that millions of Americans are unable to adequately support their families, and millions of others unwilling to work for poverty wages and under demeaning conditions because “growth is good” is one of the dogmas of our “elites.”

Reread Miller’s opening paragraph. A “shortage” of workers somehow comes as a "surprise" to employers who have been falsely complaining about that very thing for decades is resulting in [slightly] greater pay for workers in lesser-skilled occupations and is attracting more women into these jobs, which would not be occurring if there were truly a shortage of workers. If there were a shortage, there would be no workers, men or women, available to take those jobs.

To say the United States has a shortage of blue-collar workers is bogus if one is applying the standard useage of that term. It can only be true if one accepts the ideological premise that employers should use the immigration system as a method of bringing in workers who will accept the wages and conditions they prefer to offer, instead of employers having to recruit and retain domestically available workers. This is an opinion widely held by both Republicans and Democrats in Congress, and some writers at Bloomberg, apparently, but is a only one way of looking at how our labor market and wider economy should function. It is not a matter of fact.

A labor shortage means a lack of available workers, not an abundance of available workers employers prefer not to hire.

The fact is there is an oversupply of workers in the United States. About 55 million people between the ages of 18 and 65 are not working. According to the Bureau of Labor Statistics October 2018 survey, almost 11.5 million people wanted to start work immediately. The unemployment rate for those without a college degree is much higher than the national average, as are the rate of those without a college degree who have dropped out the labor market altogether.

Yet, Miller quotes uncritically Peter Quigley, executive vice president at Kelly Services staffing company claiming there is an “acute shortage” of blue-collar workers. And, of course, Miller also mentions immigration as a way to alleviate this problem.

That any tilt in the balance of power toward American workers is presented as a precipitating crisis shows the stranglehold business lobbying groups such as the U.S. Chamber of Commerce have on our government, and why the use of the term “corporate media” is appropriate. Miller writes for a publication owned by Michael Bloomberg, one of the richest men in the world, who also founded an organization with media mogul Rupert Murdoch that seeks to massively increase immigration to the United States. Mexican monopolist Carlos Slim is the largest shareholder of The New York Times, and then there’s that Bezos fellow over at The Washington Post who's done pretty well for himself lately.

It also demonstrates the state of organized labor when the leader of the AFL-CIO now teams up with the U.S. Chamber to push for more foreign workers to compete with Americans.

If lower immigration is a factor in the rise of wages, as Miller suggests in his piece, then hasn’t higher levels of immigration been a factor in lowering wages? And aren’t rising wages a good thing? Isn’t it desirable to give workers, many of who have lived through a decade of wage stagnation, a raise?

Working for an organization that seeks to lower immigration in order to boost pay for American workers, one can get frustrated when the issue is only dealt with from the perspective that immigration should always be formulated to favor employers over employees. It is maddening when the demonstrably false assertion there is a worker shortage in the U.S. keeps being bandied about by members of the media.

This isn’t to pick on Rich Miller. He’s has plenty of company. He may, in fact, believe there is an “acute shortage” of workers. But there isn’t. Not even in agriculture.

It is true that agribusiness has trouble finding workers in certain crop sectors that are labor intensive and have a narrow harvest window. This type of work is unattractive to most Americans, and to non-Americans, as well. Agribusiness operators are having difficulty finding workers willing to work for the pay and conditions on offer. This is not the same thing as a shortage of workers. Unwilling to boost pay and offer better conditions, and stymied by their failure to reinstitute indentured servitude, agribusiness is increasingly turning to mechanization.

Recently, CNBC reported on a new robot that could pick peppers. This is needed because "Farming worker shortages are getting worse." At least according to a survey of conducted by the California Farm Bureau Federation.

Here’s an important question: With Americans living longer, continuing mass immigration, increasing mechanization, the systematic unemployment of an ever-increasing number of U.S residents, and ever-growing entitlement costs, what is the future going to look like?

Some people have tried to answer that question. The best one I’ve come across so far is “Blade Runner with food stamps.”

Let’s at least hope we get these “labor shortages” dealt with in the dystopian future.

ERIC RUARK is the Director of Research for NumbersUSA

Updated: Thu, Jul 18th 2019 @ 5:45pm EDT

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