Misery Economic Theater 2011

[Christenson]

Originally Posted by fivemack

A bit of me thinks that 'can't find people with the required skills' often means 'can't face training up people who have approximately the required skills'; on the other hand on another forum I frequent someone's complaining that he's trying to recruit machine-tool operators and gets less than 30% correct answers, among what looked like serious applicants, to the question 'how many thousandths of an inch are there in an inch'.

I certainly think there's a lot of "can't face up to training someone who could learn it quickly", and "scared they will train someone that won't stay because they are too smart".

However, a mexican gentleman who leads a contract crew that builds pallets had a question to me yesterday about the dimensions on the print; after I explained to him that the dimensions were in both millimeters and inches, he wasn't sure that a number ending in 0.750 meant 3/4 was to be added to the number of inches.

[schickel]

Originally Posted by R.D. Silverman

My bet is on the latter.

BTW: In regard to the unemployment situation in the U.S., NBC news had
a brief segment about Siemens Corp. They claim to have "several thousand"
jobs openings that they can't fill because they can't find people with the
needed skills.

Originally Posted by fivemack

A bit of me thinks that 'can't find people with the required skills' often means 'can't face training up people who have approximately the required skills'......

Originally Posted by Christenson

I certainly think there's a lot of "can't face up to training someone who could learn it quickly", and "scared they will train someone that won't stay because they are too smart"....

This kind of reminds me of Circuit City a few years ago:

Circuit City to Fire 3,400, Hire Less Costly Workers:

Circuit City Stores Inc., the second-largest U.S. electronics retailer after Best Buy Co., fired 3,400 of its highest-paid hourly workers and will hire replacements willing to work for less.

The company said its eliminating jobs that paid ``well above'' market rates. Those who were fired can apply for the lower pay, company spokesman Bill Cimino said today.

Another perspective:

An interesting paradox in the technology world is that there is both a shortage and a surplus of engineers in the United States. Talk to those working at any Silicon Valley company, and they will tell you how hard it is to find qualified talent. But listen to the heart-wrenching stories of unemployed engineers, and you will realize that there are tens of thousands who can’t get jobs. What gives?

And wasn't there a push a while back to raise the limit on H1B visas in the US because there wasn't enough talented people here?

[Fusion_power]

There is indeed a shortage of skilled talent in the industry I work in. But there is also a reason why those people are in short supply. Communications businesses have assiduously trimmed headcount for the last 8 years, especially in the last 4 years. The result is that skilled employees went elsewhere and stayed there. Now there are very few people available that can do the required work. This is a serious problem that really hits home to me because I have been working 70+ hours per week for about 3 months. It would not be so bad except that I am on salary which means I get paid for 40 hours. It does not help to know that projected workload next year is set to double.

DarJones

[Christenson]

Shickel:
Just a quick reminder that Circuit City is no longer with us...and I've seen analysts say that that kind of personnel move is just what destroyed morale and cost the company its existence.

[jasonp]

Much of the rising standard of living over the last few years has been disproportionately awarded to college graduates, but a college degree by itself is not a guarantee of anything anymore. My wife's (2010) graduate school class on the whole had a great deal of trouble finding jobs. What amazed me was that in 2008 there were very few paying job postings in her field in the DC area but lots of openings for volunteer spots. In 2009 the volunteer positions were *gone*, nobody needed to advertise for them. And the DC area is supposed to be one of the *better* employment regions.

It used to be that a degree in electrical engineering meant you could write your ticket, but the competition is just ruthless now. I've worked places where just the hall with my office had people from India, Taiwan, Spain and Morocco. On the one hand engineers can make a decent living in the US, but engineering is on the borderline between a field where solving hard technical problems is a requirement and gets a lot of respect and a field where what you know is a commodity that can almost be paid for by the pound. So you get the paradox where everyone says they need engineers and skilled programmers, but nobody in the US wants to major in EE.

[Christenson]

part of what JasonP sees is this charade caused by US immigration policy...to import an H1-B engineer, you need to show that noone else can do the job...advertise it, wait 6 months for paperwork, etc. So would-be employer writes a job description for *exactly* that engineer, with *exactly* the tools used by the guy, and no real intention to even look at someone with ability, similar skills, and similar tools, possibly looking at the same problem. Thus appears the "shortage" of engineers.

As an engineer in Graduate School, it was a tremendously uneconomic proposition. Living poor, getting hired by working on low-level research that should have been done by in-house engineers at the sponsor....major discouragements. And watching a certain math professor self-destruct after getting tenure, on account of not being at Princeton...you want to see where RDS was, it wasn't a pretty place. There's a reason I do this math stuff on a strictly amateur basis.

In my own experience, the average employment decider in engineering has no engineering background, and cannot recognise the required talent and persistence by itself, and the degree is not a good analog. I work with degreed electrical engineers for whom ohm's law is not obvious, who cannot recognise parasitic coupling, etc. I certainly remember a fellow graduate student for whom the degree measured his ability to stick around more than it did to get anything meaningful done or calculated, and I'm pretty sure RDS could name similar people from the math field. I'm now up to the second technician in a decade in my organisation with more engineering talent than most of the degreed engineers he works for, out of a group of about a dozen.

I think a big part of the problem is similar to one in the world of equine sports: Students don't want to pay for the hard education that would stretch their abilities and give them real skills. Colleges, like most horse instructors, are not in a position to turn down the student's (often borrowed) money.

Not that I liked classes whose job was to weed out the untalented...circuits 2 did a good enough job of that.

[xilman]

Originally Posted by jasonp

Much of the rising standard of living over the last few years has been disproportionately awarded to college graduates, but a college degree by itself is not a guarantee of anything anymore. My wife's (2010) graduate school class on the whole had a great deal of trouble finding jobs. What amazed me was that in 2008 there were very few paying job postings in her field in the DC area but lots of openings for volunteer spots. In 2009 the volunteer positions were *gone*, nobody needed to advertise for them. And the DC area is supposed to be one of the *better* employment regions.

It used to be that a degree in electrical engineering meant you could write your ticket, but the competition is just ruthless now. I've worked places where just the hall with my office had people from India, Taiwan, Spain and Morocco. On the one hand engineers can make a decent living in the US, but engineering is on the borderline between a field where solving hard technical problems is a requirement and gets a lot of respect and a field where what you know is a commodity that can almost be paid for by the pound. So you get the paradox where everyone says they need engineers and skilled programmers, but nobody in the US wants to major in EE.

Back in the late 70's, when I was mid-way through my first degree (BA in Natural Science (Chemistry) --- Oxford has some rather idiosyncratic nomenclature) it was clear that the majority of the opportunities for the more capable scientists and engineers were not located in the UK. The brain drain had started several years earlier and continued for at least a decade afterwards.

It may be the case that the US has to come to terms with a brain drain of its own.

Paul

[fivemack]

When there was the strong brain drain from the UK to the US, it wasn't (as far as I know) particularly difficult for a UK person, having got a job offer in the US, to get the right to work there and start working; and the US salaries were more than the UK offered even for such jobs as existed here.

There's a degree of that now from southern to northern Europe; if you've got an engineering PhD from NTU Athens, you're likely to find more interesting work for more money if you look for it in Cambridge or London or Amsterdam or Frankfurt.

But, if I see things correctly, the situation with America isn't quite the same. You're not seeing thousands of smart American engineers get their PhD and get on the next plane to Bangalore or Shanghai because the opportunities are better there; you're seeing Indians who got their first degree from IIT Mumbai and their PhD from Caltech get on the next plane back to Bangalore rather than looking for work in Silicon Valley, and there doesn't seem to be much demand from Bangalore or Shanghai for American engineers; they have enough engineers locally and American engineers ask for too much money.

The glass banking towers of Pudong contain a fair number of Westerners, but they're expats working temporarily in Shanghai for Western banks.

[jasonp]

(I should mention that 99% of the foreign-born folks in the environment I described were naturalized US citizens, and had worked for the company for many years)

Engineering grad school, in the mid-90s, was much more of a thought exercise for me than any sort of concrete training in EE. Two years into the grad program I realized I sucked at the specialty I'd chosen, and that I was much better at programming than at conventional engineering design. It made me sad to realize that I myself would have never measured up to the standards of actually getting stuff done that I looked for in resumes from college grads.

[schickel]

Former US Secretary of Labor Robert Reich explains what the S&P downgrades means for the US (and what happens if it gets downgraded further):

[ewmayer]

Mish has a piece thanking S&P and the other major ratings agencies for their gross incompetence and corruption - his take being that things needed to get really bad in order for there to be a chance of real reform.


Mish also has a nice link-fest about the credit crunch hitting the EU financial system - I love the obligatory spate of soothing "this is not 2008"..."things are not as bad as they seem"..."investors are overreacting"...blurbs from the sell-siders and government officials, I`ve bolded the most-notable such:

"Lehman-Like" Credit Crunch Hits EU; ECB Will Not Disclose Affected Banks; Euro-Style Anxiety Spreads to U.S.

Please consider European bank stocks hurt by borrowing crunch

European bank stocks tanked Thursday as fears mounted about their exposure to the region's debt crisis and weakening economy.

The stock prices of Britain's Barclays and France's Societe Generale led the way down, falling 11.5 percent and 12 percent, respectively. Germany's Commerzbank fell 10 percent.

Analysts said the plunge was partly a reaction to evidence that European banks are being forced to pay more for the short-term loans they need to finance day-to-day operations.

Some European banks with heavy exposure to the debts of Greece and other weak countries are relying on loans from the European Central Bank because other private banks are reluctant to do business with them. The ECB said one bank, which it didn't identify, had paid above-market rates to borrow $500 million a day for seven days.

Euro-Style Anxiety Spreads to US

The New York Times reports Euro-Style Anxiety Spreads

European banks are continuing to show signs of strain, making investors increasingly skittish about American financial institutions.

Regulators, bank executives and others continued to play down the risks on Thursday, emphasizing that this would not be a repeat of the 2008 financial crisis. In Europe, political leaders have vowed to prevent a Lehman-like collapse of a major bank, while American firms are better insulated from potential shocks than they were three years ago.

But on Thursday, shares of some big Wall Street banks sank to levels nearly as low as that in the months after the downfall of Lehman Brothers. Among investors, anxiety has been intensifying over the soundness of European banks despite repeated efforts to contain the sovereign debt crisis. The latest fears flared up after an unspecified lender tapped an emergency borrowing program set up by the European Central Bank to ensure that firms had ample funds in dollars.
...
“A lot of this concern around the European banks is overstated,” said Alex Roever, a short-term fixed income analyst at JPMorgan. “We are not looking at another 2009, although investors are obviously being cautious.”

My Comment: I`m confused: Is it a repeat of 2008 or of 2009 we are most assuredly not looking at?

Former Moody's Senior VP ays Ratings Agency Rotten To Core With Conflicts, Corruption, And Greed

MOODY'S ANALYST BREAKS SILENCE: Says Ratings Agency Rotten To Core With Conflicts, Corruption, And Greed

A former senior analyst at Moody's has gone public with his story of how one of the country's most important rating agencies is corrupted to the core.

The analyst, William J. Harrington, worked for Moody's for 11 years, from 1999 until his resignation last year.

From 2006 to 2010, Harrington was a Senior Vice President in the derivative products group, which was responsible for producing many of the disastrous ratings Moody's issued during the housing bubble.

Harrington has made his story public in the form of a 78-page "comment" to the SEC's proposed rules about rating agency reform, which he submitted to the agency on August 8th. The comment is a scathing indictment of Moody's processes, conflicts of interests, and management, and it will likely make Harrington a star witness at any future litigation or hearings on this topic.
...
In short, Harrington describes a culture of conflict that is so pervasive that it often renders Moody's ratings useless at best and harmful at worst.

Harrington believes the SEC's proposed rules will make the integrity of Moody's ratings worse, not better. He also believes that Moody's recent attempts to reform itself are nothing more than a pretty-looking PR campaign.