U.S. Economy Struggling Coping with “Skills Overage”

By Joe Guzzardi
February 9, 2015

January’s Bureau of Labor Statistics report is the latest in a predictably upbeat but misleading assemblage of economic data slanted to make it look like the economy is improving. Under that glowing scenario, Wall Street and the White House look good. With January showing total nonfarm payroll employment increasing by 257,000 jobs, the Street can claim as one well known investment bank did that “it’s raining jobs,” and President Obama can take credit for having turned the economy around.

But, especially for the college-educated and minority workers, the true picture is completely the opposite of the rosy one advanced by vested interests. Zero Hedge, a candidly anti-establishment financial blog, offered an interesting example of the deceptions included in the false claim that the job market is continuously improving.

Recently, an unemployed 26-year-old with a master’s degree created a fake job opening as an experiment to gauge just how awful the labor market is. Here’s the mundane job description: “full-time position with health benefits for an administrative assistant in a busy Midtown Manhattan office. Hours are Monday through Friday, nine to five. Duties include filing, copying, answering phones, sending e-mails, greeting clients, scheduling appointments. Previous experience in an office setting preferred, but will train the right candidate. Compensation: $12-$13 per hour.”

The ad received 653 responses in 24 hours with 10 percent or 64 applicants having a minimum of ten years’ experience, and 3 percent or 19 prospects with master’s degrees. Presumably, one will get the job but the other 652 would remain unemployed even though they are equally qualified and willing to work in uber-expensive Manhattan for the pauper’s wage. Assuming the unfortunate 652 give up their job search after a month, they will no longer be officially included among the nation’s unemployed pursuant to BLS’s definition of unemployed. Those who are lucky enough to land jobs will most likely find themselves working in the McJobs category like retail where demand remains high. Wages range from $8-$10 an hour but without benefits.

When broken down by demographics, monthly government reports tell dramatically different stories. In January, teenagers and blacks had unemployment rates above 10 percent. Since 2009, unemployment for blacks has declined less than any group, a grave disappointment to African-American leaders who hoped for a rebound under Obama. The all-inclusive U-6 unemployment rate for blacks has hovered around 19 percent since 2014.

The so called “skills gap” that Obama and cheap labor employers cite as justification for their advocacy to increase legal immigration, expand the numbers of non-immigrant visas for millions more overseas workers, and issue employment authorization documents to five million unlawful immigrants is a cruel ruse. In today’s labor market, one million young workers and college graduates are neither employed nor, because opportunities are so scarce, actively seeing work. In no industry does the number of job openings even come close to the number of people hoping to fill them.

The surplus of unemployed young Americans with degrees in every conceivable field proves as a basic function of supply and demand economics that the U.S. has a “skills overage” which will become more acute if millions more immigrants join the labor force.

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Joe Guzzardi is a Californians for Population Stabilization Senior Writing Fellow. Contact him at [email protected]