How the Other Half Thinks

By Troy Senik, Ed. | July 19, 2012 | Ricochet

The folks over at the Daily Kos’s labor section (count me among those shocked that the entire website isn’t considered the labor section) have developed a novel theory of unemployment — one in which American workers are Charlie Brown and a nation full of impish employers are playing the part of Lucy pulling away the football.

A post there this week by Laura Clawson reacts to a recent study showing that American employers are, on average, devoting fairly limited resources to picking up new hires. Rather than trying to discern the economic rationale that may lead to such behavior, Clawson has developed a more parsimonious theory — employers are schmucks:

During the recession, businesses didn’t have to try much at all to get a slew of ridiculously overqualified applicants for any job, and they got used to that. Now that things are picking up a little, employers are still spoiled, expecting to be able to snap their fingers and get what they want. And if that’s not the way it works out, they’re content to just sit around waiting and lamenting the lack of qualified applicants, rather than actually making an effort to recruit workers…

… So basically, it’s like this: business puts up a couple halfhearted ads offering $10 an hour and no benefits for a job requiring substantial skill and training, then waits for the applications to pour in. Only now, there are some applications but not thousands of desperate people begging for the job. The business takes its sweet time looking through those applications and getting back to people, some of whom may by now have found equivalently good jobs. Business then complains to reporters that there just aren’t enough qualified applicants for the jobs it’s trying so hard to fill. Reporter dutifully publishes article blaming unemployment on unemployed people.

Put aside, if you can, some of the ball-pein-hammer-to-the-skull stupidity at work here (Is the first word that comes to mind when describing the lot of business owners in this economy “spoiled”?) and consider the broader argument on the merits. Call me crazy, but I have a hard time believing that there is a critical mass of employers out there willing to spend any money on an ad for new hires without an expectation of getting something back for it. I would think that the Daily Kos — which through its prose seeks to graft a top hat and monocle onto every business owner in the country (excepting those who run pilates studios or macrobiotic smoothie shops) — would be uniquely sensitive to the self-interest at work here.

A “halfhearted ad” is just not something any entrepreneur worth his salt engages in. They don’t generally spend money out of indifference. Moreover, anyone who knows an actual employer knows that they tended to hate the glut of applications that would accompany any job opening during the depths of the recession for the simple reason that it was prohibitively difficult to sort through them.

What’s most remarkable here is the total lack of awareness that there are labor markets. Any employers behaving with the lethargy Clawson is describing here are putting themselves at a competitive disadvantage by failing to snap up talent at reasonable wages. The idea that competitors wouldn’t jump at the opening thus created defies belief.

It’s safe to say that there are a wide variety of explanations for the labor market’s prolonged inability to snap back to something approaching a normal equilibrium. But it’s also probably safe to say that employers’ thirst for the tears of the unemployed is not one of them.

Source