WHERE ARE THE JOBS, CONT'D
Reader Tim Belknap writes:
I am an 20-year veteran, operating executive at a rather gigantic company and we are hiring, but mostly for replacement and some niche growth areas (sales, engineers, product managers etc.). I think we'll just barely grow our employment year over year.
I don't think one can characterize the American economy by what us Big Multinationals do, but all of you are on to something regarding how expensive and risky it is to do business now than it was 5 years ago.
All of the [Sarbanes-Oxley] costs are going to be amortized on employees...so we've made it even more expensive to hire people. Already, we put aside nearly 40 cents on the dollar for every employee we hire for benefits, pension, healthcare etc. How long until that is dollar for dollar? Are you kidding me?
The structure costs of business reporting are brutal also. I am sure you've seen the report from Emerson on US competiveness.
And frankly, people can be a pain in the rear. At 5.6% unemployment, you just can't convince me or any of my peers that the people out there looking for work are top notch...and as expensive as it is to hire someone, we want the best. Otherwise, you'd be surprised how well you can get by without someone, especially someone of mediocre professional value.
So we are either hiring from campus (aren't in the 5.6%) or from other companies (ditto).
I know this "get by" without hiring is real because we've never seen the leverage on sales like we are seeing now. That is, our revenues have grown double digits, and we've not added anyone, or even added any physical capacity.
I'm sure this doesn't help Bush, but it has very little to do with him or his team anyway. I laughed out loud when I heard Carville's response on Meet The Press this weekend. Russert asked him what specifically the Democrats would do to help improve job growth and he said something like "spend more money on roads and infrastructure to make us more productive" I thought Industrial Policy was the 1992 mantra?
The 5.6 percent unemployment isn't equally distributed across professions; in fields with lots of layoffs, job seekers may in fact be highly qualified. But Tim's note captures the risk aversion that's holding down hiring. It also points to the unmentionable reason high-tech companies are looking abroad for programmers: When you're trying to get the very, very best--the top 1 percent--it helps to expand the pool to a billion Indians, not to mention drawing from an elitist education system that leaves lots of children behind but gives the geniuses unsurpassed training.