Monday, March 11, 2013

Of High Growth and Low Wages

The Skeptical Entrepreneur is thunderstruck - yes, thunderstruck! - ladies and gentlemen, to read in Money's online edition that robust job growth in one career field is accompanied, hand-in-hand, by less-robust wage growth in that career field. Strike TSE down with a feather!

It seems that demand for home-healthcare aides is booming. Given that perennial demand for jobs has been exacerbated lately by a shortage of supply, folks are flocking to home-healthcare like carrion birds to . . . well . . . never mind, but suffice to say that demand for jobs has produced an abundant supply of workers, once the supply of jobs perked up to meet the demand. Clear as mud, right?

And, surprise, surprise, surprise, as the supply of workers has spiked in the home-healthcare-aide market, what has happened to the value of that commodity? Well, whatta ya know - the labor market behaves just like any other commodity market! The Skeptical Entrepreneur hardly knows for whom to weep first.

Shall The Skeptical Entrepreneur weep for Money's writer, who appears to have discovered laissez-faire, or at least free-market economics? Probably better to weep for the editor(s), who considered this a reasonable slant for the article, assigned it, edited it, and posted it, all with a straight face and the comfort of knowing they were providing a service for the infotainment-starved masses.

The Skeptical Entrepreneur declines to weep for the capitalists, who having planned their work (or, at least, having arranged economic conditions in such a way that consumers will stampede to any job, no matter how distasteful, for however small a pittance), are now working their plan.

Perhaps The Skeptical Entrepreneur should weep for his fellow Americans, who are so economically-illiterate that they need to be fed this sort of non-information, and will lap it up with scarcely an ironical gulp.

Perhaps The Skeptical Entrepreneur should weep for the academic economists, who, if they are as clueless as academic historians, could stand to hear "the circular flow of goods and services," and "commodity prices and supplies vary inversely with each other" just one more time, for old times's sake.

No, The Skeptical Entrepreneur reserves his tears for the poor dumb bastards who have flocked into home-healthcare aide work, especially those with shiny, new student-loan debt. It reminds TSE of the heady days of the MCSE boom in the mid-1990s, when TSE managed to avoid the stampede to second-class techno-geekery, being content to continue to flip hamburgers

As it turns out, Mark Twain was right:  "History doesn't repeat itself, but it does rhyme."

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