

US Underemployment 28.4% for young people, 18.4% in all Age Groups - startuprules
http://www.gallup.com/poll/141770/Underemployment-Steady-July.aspx

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jsz0
I've been wondering how many of these jobs are just gone for good due to
higher efficiency and permanently increased productivity? We assume most of
the unemployment & underemployment is caused directly by the recession but I'm
not so sure about that. It seems possible to me we had sort of a jobs bubble
where companies were overstaffing and the recession just exposed this. If you
lay off 20% of your staff and magically the other 80% pickup the slack what
incentive is there to re-expand by 20%?

My theory is modern technology and communications have just made certain
positions inherently more productive. I can think of a time not that long ago
where I may have lost an hour a day driving back to my office just to check my
e-mail. Now I do that throughout the day on my SmartPhone while working on
other projects. For a less skilled job I look at how grocery stores now scan
products by UPC. There goes the job of the 19 year old tagging every can of
corn with a little price tag sticker. When you run out of corn your computer
inventory (tracked by UPC) knows about it. You spend 30 seconds re-ordering
more through a computer instead of 15 unproductive minutes on the telephone
waiting for the supplier to take your order. If these scenarios are being
repeated in different ways all over the economy I think we need to consider
that the rise in worker productivity is permanent and these jobs are gone for
good.

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tkahn6
This.

I find it absolutely _amazing_ this hasn't been talked about more. I have no
idea what the majority of the population is going to do in the near-future.
These jobs are not coming back. I posit that a large percentage of the
currently unemployed will never be employed in their sector again. We will
never reach pre-2007 employment levels because the majority of jobs weren't
and aren't _necessary_.

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andreyf
_I have no idea what the majority of the population is going to do in the
near-future._

Some part of marketing and advertising? That seems to have been the trend for
the last century or so...

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varjag
Century? Hell, no - up until 1970s the USA was distinctly industrial
powerhouse. As were nearly all other developed economies.

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joelmichael
The minimum wage makes it difficult to hire unskilled workers. If it didn't
exist, there would be a lot less unemployment for young people just starting
out.

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lsc
Lowering the minimum wage, the theory states, will open up more unskilled job
hours, and thus decrease underemployment, if you define underemployment as
people who work part time, but would like full time work.

the idea being if one guy with one of those parking lot cleaning trucks can
clean my parking lot in an hour and it takes, say 10 man hours to clean my
parking lot with brooms, if the guy with the truck costs $50/hr to clean my
parking lot and a guy with a broom costs $10/hr, it's cheaper for me to hire
the guy with the truck. If I can get guys with brooms to work at $4/hr,
suddenly it makes sense for me to hire 10 guys with brooms (assuming I need it
done in an hour, and the work scales that way) rather than one guy with a
truck.

On the other hand, if you hire 10 guys with brooms, you just eliminated a
higher paying job in favor of 10 low paying jobs. this will tend to increase
the number of people taking work that is beneath their skill level. so one
could say that a high minimum wage is a subsidy on skilled labour.

I mean, even my company. right now, most of the provisioning is done by
hand... this is because I'm able to obtain fairly cheap (well, quite a bit
over minimum wage, but still, cheap by the standard of such things) SysAdmins
who /can/ provision people by hand. If the job market was better, I'd be
forced to pay much higher rates for my sysadmins, and my current mostly-manual
situation would be untenable. Granted, either way, automation is a high
priority, but with current market conditions, 'just do it by hand' is an
option, and that simply wouldn't be the case if the job market was in better
shape.

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dantheman
That is only looking at one side of the minimum wage coin. There are also a
lot of people who may only contribute 4$ of value per hour (inexperienced,
etc) who would like to work at that wage but won't get hired due to their lack
of value. But if they could get a job, they would gain experience and
eventually start contributing more value and thus be able to justify a higher
wage. Minimum wage hurts those who it is trying protect -- in fact when I
worked menial "minimum wage " jobs, I was always actually paid more than
minimum wage.

~~~
lsc
did you read what I wrote? specifically:

"On the other hand, if you hire 10 guys with brooms, you just eliminated a
higher paying job in favor of 10 low paying jobs. this will tend to increase
the number of people taking work that is beneath their skill level. so one
could say that a high minimum wage is a subsidy on skilled labour."

So yeah, a higher minimum wage does favor more expensive people who can be
more productive over less expensive people who are less productive.

My first job didn't pay minimum wage, and I know that some 15 year old fixing
computers is rather different than an adult labourer trying to feed a family,
but I feel that I benefited from having the job; It got me my next job (which
was minimum wage) which started me down the path, a few years later, to a
'real job' with real pay.

~~~
codexon
_It got me my next job (which was minimum wage) which started me down the
path, a few years later, to a 'real job' with real pay._

It's all relative. When everyone starts having 2 unpaid internships or related
work as a kid paid under the table, businesses start to expect this level of
experience before hiring someone for a "real" job.

~~~
lsc
start to, nothing. most businesses expect you to have experience now, and, uh,
you need to get that experience somehow.

for me, it was a bigger problem than for most people. I didn't have a degree.
It's hard to get a real job with a degree and no experience. getting a 'real
job' with no degree and no experience is pretty much impossible.

My brother, on the other hand, has been making $20+ an hour at his
internships; a line I didn't cross until I made programmer. To be fair, he's
the age I was when I got a 'programmer' title, and his responsibilities and
accomplishments are similar to mine at his age; the only real difference is
that when school starts, he heads back to school, while I kept working.

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jhamburger
How is a young person with little or no work experience and no college
education "underemployed"? That is basically the least qualified group
possible.

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potatolicious
Least qualified for what? In previous decades young people with little work
experience and no college education had a solid blue-collar track available to
them.

Nowadays, not so much.

~~~
jhamburger
My point is if you're lucky enough to get a solid union unskilled blue-collar
job, great. If you get stuck doing a similar job without a union for much less
money, that sucks but it isn't underemployment.

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sprout
I suppose, but it will cause deflation, and whatever you want to call that
deflationary pressure, we're getting dangerously close to it.

