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Do We Need More Stimulus — or a Fix for Job-Skill Mismatches? | Bacon's Rebellion

Do We Need More Stimulus — or a Fix for Job-Skill Mismatches? | Bacon's Rebellion

tagsWhite Performance Fabric Chair May. 10 , 8

A scene from the Bassett furniture factory in Bassett, Virginia. Like North Carolina, jobs in Martinsville and Henry County, the furniture manufacturing center of Virginia, will also be vacant.

The US unemployment rate in December was 6.7%, lower than the peak of 14.7% in April, but still high by historical standards. Therefore, it is shocking to find that the hourly wage of experienced interior decorators in the furniture industry is as high as $30 per hour.

The President of the Richmond Federal Reserve Bank, Tom Barkin, was surprised when he was crossing the Fifth District to find that furniture manufacturers in North Carolina were struggling to hire workers. In this issue of writing

, He described his conversation.

One executive after another told me that his company had vacancies. Some list 40 or more. What happens when so many people are injured, when thousands of workers in industries such as catering and hotels are unemployed?

In theory, Barkin may be due to the poor reputation of the industry after a generation of layoffs. Perhaps the problem lies in the "mismatch" between the geographical location and skills of laid-off workers.

Finding answers is crucial, because the political institutions in Washington, DC are prepared to do their best to spend money to make the economy worse through economic “stimulus”. The basic assumption of the national capital is that the big problem of the economy is the lack of sufficient macroeconomic demand. In reality (this is my observation, not Ba Jin's observation), the problem may be widespread inefficiency and mismatches, and it is best to solve it locally.

Ba Jin wrote:

One mismatch is that a large part of the laid-off workers are in large cities with large leisure and hotel industries. They may be connected to their place of residence, but understandably they are unwilling to move to a smaller manufacturing town.

The second mismatch is skill. I heard at the round table that an experienced interior decorator can make $30 an hour. However, just to enter this field, workers need to undergo a six-month initial training program at a community college, and then undergo extensive on-the-job training. Therefore, if someone loses their job as a hotel service staff, they cannot immediately engage in skilled and high-paying furniture manufacturing jobs. Moreover, given that the pandemic may end in a few months, they may not have the incentive to make the necessary investments to rearm themselves.

Ba Jin pointed out that although workers have the opportunity to learn new skills and increase their income, the number of enrollment in community colleges where this "re-skilling" occurs is declining. Nationwide, the first-time enrollment rate for community colleges has fallen by 22.7% this year. The head of the community college told him that potential students are struggling with tuition fees, parenting, children at home in a virtual school, etc., and it is difficult to obtain online education.

Thank you Governor Ralph Northam for trying to solve the affordability problem of community colleges. However, whether Washington has anything useful is another question. The "CARES Act" promulgated during the Trump administration did not solve these local mismatch problems, and the 1.9 trillion US dollar stimulus plan proposed by President Biden did not seem to bring any benefit to the people, but expected any return. There is an urgent need to motivate people to invest time and energy to learn new skills and/or move to new places. Giving them free money does not drive them out of their sleepiness zone.

Providing free funds to individuals and businesses indiscriminately seems to be the way the United States does things now. of

In the House of Representatives appropriations yesterday, the Virginia Employment Commission reported that there were nearly half a million job vacancies in the state. No one wants to touch the third way, asking if all the expanded UI money and other forms of help are damaging people's motivation. Hell, we cannot blame the Democrats for what they did in this regard in 2020, because who will be in charge of the WH and the Senate.

500000? This accounts for almost 12% of the 4.3 million population of Virginia! too crazy!

You should write an article about this.

Agree with Jim. Is that the correct number?

I guess a lot of people are happy if they don't work, they can manage it at low tax rates in certain areas (other than NoVA), and probably they have alternative sources of funding (family etc.).

The last time I heard, and I heard from a top mathematician in SS, the requirements for social security disability have dropped, not so. I hope to hear the updated SS presentation now. I was not allowed to publish a report on BR’s first SS seminar... but it was so interesting, I did try a weak connection with Va.

I heard that the furniture industry has performed well during this period. Obviously, many people now want to stay at home more, so they want new and better furniture. In addition, home office and school areas need to be repaired. But this may be temporary. The demand for furniture may soon return to a few days before the pandemic. There is little motivation for someone in Richmond to move to Martinsville and devote six months or more of training to work that may only be temporary.

The furniture company must be responsible for this. After they outsourced a lot of work to China (see Beth Macy's "Factory Man"), they lost a lot of skilled workers and these workers were transferred.

Speaking of Martinsville (and vocational training), the Wind Technician Program at the New School College is gradually unfolding. It seems that the course will start next week:

I actually agree with Jim B to some extent.

There is no better opportunity to motivate people to receive retraining, especially if they are unemployed.

Make training a necessary condition for getting stimulating help.

Don't sit at home and watch TV and surf the Internet... Go to "school" remotely to receive education and guide yourself to a better future.

The government should help, but you should go for training and work.

Many of us expect Uncle Sugar to "help", but not many people are willing to sweat and take the initiative.

Attaboy, Larry!

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