Youth Unemployment

[caleb]

I used to think the local bike shop business was on the way out. Not anymore. If you're willing to go to an under-served area and focus on the things you can make money doing/selling, there's a business model to be had.

I was around when this guy started, and he seems to have had nothing but success. If you called him up I'm sure he'd answer any questions you have about making a go of it - he's a good guy.

[caleb]

With due respect to all the non-physicists out there, I call BS on all the talk about "sorry, but you just picked the wrong field", or "just do something else for a while".

You simply CAN NOT stop doing math for 2 years, flip burgers then compete again on the world stage when the suits decide in their so-called wisdom that science is useful again. It takes day-in, day-out work at or near the cutting edge to stay in mental shape for the work. If it takes "welfare research programs" for physicists and mathematicians to stay sharp, I'm willing to pay the taxes. And anyone who cares about their nation's position in the world, and humanity's future, should, too.

Just you wait. We'll spend all our money on blowing shit up rather than building it up, and then wonder why we're #2.

Here's what happens when people with some brains and willpower start working minimum wage jobs.


Perhaps labor law will be a growing field as employers find it more agreeable to fight a losing battle with the National Labor Relations Board than deal with a unionized labor force. So, maybe the solution is to go to law school, clerk in a labor firm, and help sort out the winners and losers as the service economy starts fighting back.

[54ny77]

I have a relative who is/was very sharp and had a terrific career for many years as a draftsman, working for a global power company designing all kinds of electrical equipment by hand: transformers, switches, etc...

...and along came these things called computers and rudimentary computer aided design (this is the late 70's and very early 80's, mind you), and it was "Oh, that technology crap, I'm not going to do that."

Needless to say, within a very short period of time, his career was over. He didn't adapt.

That kind of thing makes me wonder what innovation will phase out an entire new generation of skilled workers in the modern era.

I think this “entrepreneur” vs. “physicist” argument is defining things a little too black and white. How many people are career entrepreneurs, as opposed to say, a physicist who thinks up a better way to split atoms, and goes off on his own? The better mousetraps of the world are built by exterminators, or rodent psychologists, not by serial inventors.

Smart people, who are willing, should be able to find work. If you’re in a highly specialized field, and the market moves, you either move with it, or switch markets. The people who stubbornly wait for their market to come back to them are doing themselves and the economy a disservice by staying on the sideline and lamenting their fate.

[sonnybiker]

youth underemployment is as much a problem as youth unemployment is.

[sonnybiker]

youth underemployment is as much a problem as youth unemployment is.

rings ever truer today.

[sonny]

rings ever truer today.

tell me about it.


and i've finally caught you
sonnybiker, i'm sonny. nice to meet you
:beerglass:

[Britishbane]

rings ever truer today.

ditto

[doomridesout]

As a young person who majored in possibly the most vaguely academic liberal arts field humanly possible, I can't help but feel like some of this is about the absolutely batshit stuff we tell high school seniors about the purpose of college-- it certainly made me smarter and more critically adept but it also basically hardened me against any career path where someone else tells me to do tangible, specific tasks all day, which is basically 90% of the world of work.

[false_aesthetic]

option 1: spend 60k to get a degree so you can hope to make 40k/yr in a highly cut throat job market
option 2: apprentice as a plumber/electrician/carpenter for a few years and make 40k+/yr in a good job market with no student loans to pay off

#2 is a bit harder if you're in a big city + if your community colleges/trade techs/vo-techs have been cut back again and again in favor of the White Collar Lie.

[EricKeller]

what we should do is call our congressmen and tell them to listen to Krugman. We could spend our way out of the deficit, cutting back is going to make it worse. Ya, some systems are non-linear but our economy responds to some pretty simple rules.

The minimum wage was referenced above. It has really fallen quite a bit over the years. Minimum wage when I was working in a bike shop back in the '70s was somewhere in the mid-teens in today's dollars. There is no point in discounting it further. Greenspan is a bloviating hack and republican tool. He has been exposed as such by the last few years.

I can do just about everything. Contrary to stereotype, a curious mind and a Ph.D. in mechanical engineering is a pretty potent combination. The only thing I worry about is getting assasinated by the CIA because I might fall into the wrong hands.

[TomW]

That kind of thing makes me wonder what innovation will phase out an entire new generation of skilled workers in the modern era.

My guess is that we should all be very scared. Look what Keynes was saying about unemployment back in 1930:

“We are being afflicted with a new disease of which some readers may not yet have heard the name, but of which they will hear a great deal in the years to come – namely, technological unemployment. This means unemployment due to our discovery of means of economizing the use of labour outrunning the pace at which we can find new uses for labor.” John Maynard Keynes, Economic Possibilities for Our Grandchildren

This is a global issue and one that is really going to hit a lot of us hard.

Some of the comments on this thread on unemployment also come off as a touch heartless. We are in the midst of a worldwide depression that is altering the fundamentals of employment and work and the effects of it are going to grow and magnify. Is the 50% unemployment amongst the youth in Spain because they are feckless, useless layabouts? No it is because the system of finance and leverage on which capitalism has run since WW2 has conspired to utterly f^&k them.

This is a system which the people criticizing the "youth" have had full benefit of.

For instance, when baby boomers talk about the lazy youth they say so in a context where they have sat on and taken advantage of the greatest growth in house prices ever and are now sitting on piles of capital. In the context where the youth are paying for aid, social security etc. and their pensions which society and the youth cannot afford and they haven't sufficiently paid for (no, all those taxes didn't get close and this is not just an American thing). The current generation in power have altered the structures and the access to work so that degrees are now required as standard. So when a kid goes to college and has to go USD100,000 into debt to even get the hope of getting an interview... is that them being lazy or useless?

There may always be jobs in McD but that is not an answer. Sometimes such jobs can end up costing more to work in than they earn. Have a look at this painful article in the New Statesman today about a poor, employed, person who had a couple of unlucky things happen to them and had a horrendous time and nearly fell into a permanent feedback cycle of pain.

You

Also if you are really suggesting that a world class physicist retrain rather that the State takes the hit and invests and develops that physicist and their knowledge for the benefit of us all you are missing the point on capital and educational investment. If we don't maintain and sustain our investment now it will double down on the f&*king of us later.

I grow depressed about the current situation and think a fairly substantial restructuring is needed by all to survive it. The West needs to live with less and to help its own more. The developing world hopefully needs to helped to skip past our intense failures in development.

[monadnocky]

a few years ago I was witness to Alan Greenspan giving a nice bitch slap to Senator Sanders (VT) in his testimony to congress. Sanders tried to pidgeon hole Greenspan into saying that raisng the minimum wage was good. G'Span's rsponse was that kids need to have an opportunity to learn how to apply, dress for an interview, show up on time etc and a high minimum wage does rob the workforce of a certain number of those 1st time workers. Now this is not about Greenspan, that's another topic, but I think he was right in this small instance. The number of kids I see apply for jobs wearing shorts or interview in jeans blows me away. My dad would have kicked my ass if I'd have gone for an interview without a tie on, nice shoes etc. I just don't think some people are prepared for the world we live in.

Ok, ok. I know that everyone has one of "these" stories, but hear me out: I recently worked at a mid-sized neuropsychology practice which happens to be next to a few small but decent colleges. Every once in a while we have someone drop by from one of these colleges who expresses interest in an "internship" of sorts - not a clinical internship, but just a short-term secretarial "internship" to introduce them to the feel of a medical office (we're psychology, but neuropsychology in many ways is akin to a medical office). This is usually for college students who might be thinking about becoming a mental health worker of some sort - gives them the feel of the office, gives a realistic overview of what being a psychologist (or Master's level clinician) is like, etc. Of course, they are not allowed to have clinical patient contact, but you get the point.

Last spring we had the father of a colleague (a doc) contact us, stating that his daughter was interested in such a position. Warning flags already, I know, but the owner of the practice is kind-hearted and perhaps a little naive. Took her on after one interview, which I wasn't present for, but the vibe around the office was that she was dressed inappropriately for the interview.

This woman - not even "young woman" as she was a junior in college - was dressed completely inappropriately on her first (and second) day of work. Not revealing, but just waaaaay too informal. And she smelled. Bad. Literally. That wasn't necessarily the problem, though- she had absolutely no idea how to do BASIC things, like "file something in a file cabinet" (I'm talking Smith-goes-after-Jones stuff here) and "making a telephone call to someone" (what is so hard about "Hello, this is so-and-so from Monadnocky's Haus of Neuropsychology, we're reminding you that you have an appointment tomorrow" is beyond me). She had no basic, BASIC skills whatsoever, and staff demanded that she be let go after the second day. She was. It was simply amazing to me that someone in college - and this, again, is a pretty decent school - couldn't even place a file in the right location.

At the risk of generalization, I'm not claiming that she is representative of her peers. Her predecessor, from the same college, was fabulous and we hired her and we were glad we did. As Maine Mike stated way back on the first page, there's a place for people who are good, who are at least making an effort. Not always, I know - believe me, I know my share of excellent mental health workers who are at least underemployed. But at the level I'm discussing here, there's an absurd amount of individuals who have no idea whatsoever regarding what the basic requirements of the world of work are. If this woman was at least making an effort, and had some basic skills, she very likely would have been hired at least part time, and would have ALWAYS had a place to work just down the street from where she lived.

Note that I'm not making the argument that the youth unemployment problem is due to young people not trying hard enough or not having a clue. It's systemic and due to the mistakes and greed of their parents (which, coincidentally, may also may be to blame for their cluelessness regarding work in general).

[Bobqzz]

A hard hitting NY Times Op-Ed published today draws out some parallels between the Egyptian situation and our own. Here are some choice snippets...

"About one-fourth of Egyptian workers under 25 are unemployed, a statistic that is often cited as a reason for the revolution there. In the United States, the Bureau of Labor Statistics reported in January an official unemployment rate of 21 percent for workers ages 16 to 24."

"As governments across the developed world balance their budgets, I fear that the young will bear the brunt of the pain: taxes on workers will be raised and spending on education will be cut while mortgage subsidies and entitlements for the elderly are untouchable. At least the Saudis and Kuwaitis are trying to bribe their younger subjects."

What is to be done?

How does one include 16 year-olds in the unemployment statistics? Every 16 year-old in the US has a "job" called high school. Why would one except to inflate the statistics. The job market is bad enough without making it seem worse.

What mortgage subsidies?

[vertical_doug]

How does one include 16 year-olds in the unemployment statistics? Every 16 year-old in the US has a "job" called high school. Why would one except to inflate the statistics. The job market is bad enough without making it seem worse.

What mortgage subsidies?

as opposed to renters, home owners get the following:
1. Fannie/Freddie guarantee by Federal Gov lowers cost of financing
2. Federal income tax deduction for mortgage interest
3. Federal income tax deduction for state/local property taxes
4. capital gains treatment for sale of primary residence.

The subsidy favors the wealthy and presently is about US$100 billion annually.
Since these are basically tax expenditures, many people do not see them as a subsidy the same way they see something like food stamps. (Fan/Fred gtee being the exception since it is not a tax expenditure)

[Bobqzz]

as opposed to renters, home owners get the following:
1. Fannie/Freddie guarantee by Federal Gov lowers cost of financing
2. Federal income tax deduction for mortgage interest
3. Federal income tax deduction for state/local property taxes
4. capital gains treatment for sale of primary residence.

The subsidy favors the wealthy and presently is about US$100 billion annually.
Since these are basically tax expenditures, many people do not see them as a subsidy the same way they see something like food stamps. (Fan/Fred gtee being the exception since it is not a tax expenditure)

Most of those apply to the owners of rental property,therefore to renters.
The government NOT taking your money is NOT a subsidy. It presupposes that the government is entitled to all your money- "some" people are correct in saying they are not subsidies and this is a very important point. Words matter.

[caleb]

The government NOT taking your money is NOT a subsidy. It presupposes that the government is entitled to all your money- "some" people are correct in saying they are not subsidies and this is a very important point. Words matter.

Well, the Brookings Institution and pretty much every mainstream economist I've ever read regards the mortgage interest deduction as a subsidy to the housing market and homeowners. The effect of a deduction is very similar to a direct payment, so the only reason I can think of to refuse to call it a subsidy would be a desire to frame favored government action as inaction in order to depoliticize it. I understand that there's a group of people that want to use the language of deductions and loopholes to talk about government choices that benefit the well off and use a different vocabulary - entitlements and subsidies - to talk about the government action that benefits the poor, but I just don't see the distinction. You're right that words matter, and that's especially true when language is used to create false distinctions that support political ends.

[vertical_doug]

Most of those apply to the owners of rental property,therefore to renters.
The government NOT taking your money is NOT a subsidy. It presupposes that the government is entitled to all your money- "some" people are correct in saying they are not subsidies and this is a very important point. Words matter.

Most of those apply to the owners of rental property,therefore to renters.
The government NOT taking your money is NOT a subsidy. It presupposes that the government is entitled to all your money- "some" people are correct in saying they are not subsidies and this is a very important point. Words matter.

Loopholes , deductions and other tax expenditures are subsidies. These are just buried in the tax code to make it more difficult to decipher. The issue of what is the right level of taxation is an important one. But it is easily lost in the tax code. For example, corporations complain about the U.S. high statutory tax rate of 35% being the highest in the world. A true statement. However, with the sheer number of tax deductions corporations can claim, the avg effective rate is around 12.1 % (2011 data) which is among the lowest in the OECD.

A flat tax would be an interesting experiment, but it is in the wealthy interest to kill it. You should make no mistake about it but tax expenditures are there to subsidize the wealthy.

[rfj1862]

This is a system which the people criticizing the "youth" have had full benefit of.

Thank you Tom, I logged on to say much the same thing, but I see you've said it much more eloquently than myself.

I hate threads where older folks complain about how today's youth are lazy, when in fact every post-Baby Boom generation is paying the price for Boomer's untrammeled greed. Gen X and later are no better or worse than previous generations, it's just that we've been screwed by those who came before us.

Imagine being a member of Generation X. Say you graduate from college in 1995 and get your first job. Only 5 years later your savings disappear in the crash of 2000. Then you spend 8 years chasing a house that you can't afford because prices are being driven higher by Boomers with more money than sense. Then, just as you've gotten a good nest egg, it's all taken away again in the crash of 2008--again fueled by the greed of the previous generation. And let's not forget that by 2008 you're in middle management, so you're first in line to lose your job as the previous generation scrambles to cover its ass.

Sound like fun? This isn't my personal experience because I've been successfully self-employed since grad school, but I know many, many smart and hard working people who have gone through just this. And the generations after Gen X? They don't have a chance.

And of course there is a huge demographic bulge moving through the system that becomes more conservative as it ages, so things like labor unions, safety nets, and government assistance for buying a home (mortgage tax deductions) are disappearing. Plus things are likely to get worse before they get better because we'll be paying for the Boomer's retirement.

Let's make a thread about lazy, overentitled old folks who have benefited tremendously from the system and now we have to pay the price. They got theirs, and screw everyone else.

[lukasz]

Thank you Tom, I logged on to say much the same thing, but I see you've said it much more eloquently than myself.

I hate threads where older folks complain about how today's youth are lazy, when in fact every post-Baby Boom generation is paying the price for Boomer's untrammeled greed. Gen X and later are no better or worse than previous generations, it's just that we've been screwed by those who came before us.

Imagine being a member of Generation X. Say you graduate from college in 1995 and get your first job. Only 5 years later your savings disappear in the crash of 2000. Then you spend 8 years chasing a house that you can't afford because prices are being driven higher by Boomers with more money than sense. Then, just as you've gotten a good nest egg, it's all taken away again in the crash of 2008--again fueled by the greed of the previous generation. And let's not forget that by 2008 you're in middle management, so you're first in line to lose your job as the previous generation scrambles to cover its ass.

Sound like fun? This isn't my personal experience because I've been successfully self-employed since grad school, but I know many, many smart and hard working people who have gone through just this. And the generations after Gen X? They don't have a chance.

And of course there is a huge demographic bulge moving through the system that becomes more conservative as it ages, so things like labor unions, safety nets, and government assistance for buying a home (mortgage tax deductions) are disappearing. Plus things are likely to get worse before they get better because we'll be paying for the Boomer's retirement.

Let's make a thread about lazy, overentitled old folks who have benefited tremendously from the system and now we have to pay the price. They got theirs, and screw everyone else.

In my field people literally wait for professors to die. Here's some stats from an article a colleague wrote last year: "I applied for a total of 281 academic positions: 181 tenure-track (or otherwise permanent); 58 replacement (visiting, sub, etc.), 36 postdocs, and 6 public historian (i.e. in-house historian at the Department of Defense). I had (or was offered) 15 first-round interviews (8 of which for tenure-track or permanent jobs) and 7 on-campus interviews (4 for tenure-track/permanent). The result: five job offers, two of which were tenure/track or permanent and three for visiting positions (including the two visiting positions I accepted last year)." I sure am looking forward to THAT.

[Joel Benjamin L]

In my field people literally wait for professors to die. Here's some stats from an article a colleague wrote last year: "I applied for a total of 281 academic positions: 181 tenure-track (or otherwise permanent); 58 replacement (visiting, sub, etc.), 36 postdocs, and 6 public historian (i.e. in-house historian at the Department of Defense). I had (or was offered) 15 first-round interviews (8 of which for tenure-track or permanent jobs) and 7 on-campus interviews (4 for tenure-track/permanent). The result: five job offers, two of which were tenure/track or permanent and three for visiting positions (including the two visiting positions I accepted last year)." I sure am looking forward to THAT.

The truth of the matter is that approximately 95% of the PhD programs in the Humanities should be shut down. There are not jobs to place the people with degrees. The only reason that they exist is so that universities can use them as cheap labor for TA's and introductory classes. It is an extremely sad story.