3/21/2012 5:23 PM ET
Signals from the labor market suggest the US workforce is becoming less productive, even as fewer unemployed Americans look for work. Are we going soft, or is something else going on?
American workers have hit a wall.
For years, productivity has been the U.S. economy's saving grace. I'm sure you're heard this line: Sure, American workers cost more, but they're the most productive in the world.
That's changing. For the first time since the recession ended, businesses are increasingly unable to squeeze more and more work out of existing workers. Workweeks have been maxed out. Manufacturers are increasingly turning to expensive overtime to fill orders.
Yes, with corporate profits at record highs and millions still out of work, it's hard to feel bad for those in corner offices poring over résumés. But their job has gotten tougher. Rather than hiring from an eager, skilled and educated reserve army of workers, recent data suggest they're facing an emerging skills shortage.
The debate over 'Coming Apart'
Labor productivity, a measure of how much work is done per hour, has plunged over the past four months while labor costs have spiked toward pre-recession highs. The unemployment rate has dropped dramatically. And yet wage growth has stalled.
Translation: Companies appear to be hiring more less-skilled and less-motivated workers at low pay levels to get the same amount of work done. That's crimping profit margins and pushing inflation higher. At the same time, many qualified workers seem to be turning up their noses at jobs they see as demeaning, or that don't pay what they need, and they are deciding instead to leave the workforce, trying to strike out on their own or retire.
Anthony Mirhaydari
You could read these data to suggest Americans are getting lazier, losing their skills or letting them fall out of date, and choosing not to take jobs they view as beneath them. Or you could fault employers for not offering enough rewards to interest even the long-term unemployed.
Both are true, to some extent. And to me, a deep dive into the jobs picture suggests that what we're seeing is an across-the-board erosion of Americans' can-do spirit. It's a change that will have wide-ranging consequences on everything from corporate profits and Federal Reserve policy to the overall shape of the nation's economy for years to come.
Let's take a look at two key age groups that illustrate the problem. Then we'll zero in on how it impacts the economy and investing.
This laziness dynamic, to the extent it is present, seems to affect the young rather than the old, men more than women, and the uneducated more than the educated. The overall drop in the men's labor participation rate -- the number of American men who have jobs or are actively looking for one -- is shown in the chart below. It's fallen to near 70%.
Part of this is no doubt due to the overall economic picture; job creation hasn't been high enough to keep pace with population growth for years. America is also aging, but this isn't just older people stepping out. The numbers are particularly painful in the 16- to 24-year-old male demographic, with workforce participation falling from nearly 80% in the late 1970s to around 58% now.
Is something else at work here?
/*
Charles Murray, a frequent and controversial commentator on racial issues, has gotten a lot of attention lately for his recent book, "Coming Apart: The State of White America, 1960-2010." He paints the problem as a cultural one. Society seems to believe it's better to be a young idealist who's above lawn-and-garden work or a part-time college student who's more focused on music and Ultimate Fighting Championship fights than to be a 9-to-5 go-getter.
He also theorizes that, with female-dominated sectors such as education and health care being relatively healthy parts of the economy, men are needed less and feel less pressure to work. In a recent piece in the Wall Street Journal, Murray writes:
"Whether because of support from the state or earned income, women became much better able to support a child without a husband over the period of 1960 to 2010. As women needed men less, the social status that working-class men enjoyed if they supported families began to disappear. The sexual revolution exacerbated the situation, making it easy for men to get sex without bothering to get married. In such circumstances, it is not surprising that male fecklessness bloomed, especially in the working class."
Murray suggests these feckless young adults should be the subject of public scorn. After all, Americans used to share a moral imperative to be productive contributors to society, not couch-surfers wielding armories of Apple products. Similarly, David Brooks of The New York Times, also concerned about the rise of young, listless males, suggests one fix could be subsidies from the government to encourage men to, at the very least, get married and be responsible parents to their children. (I wonder how that would fare in Congress.)
Truth is, this explanation sounds a little too easy; these aren't the first old guys to complain about "kids these days." Getting a job that will pay the bills is tough; it can seem that work doesn't pay. And fecklessness isn't the exclusive property of the young, unemployed and poor, as any number of nauseating "Real Housewives" spinoffs prove regularly on reality TV.
But their "feckless young" are my peers, and I can tell you they have a point. Clearly, there is work to be done, both literally and figuratively.
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Went to work for a company for a certain pay and benefits looking forward to the time we could retire in relative comfort... being told all these years that we should save for the future and thinking benefits would be there.
Well...everything changed..benefits are nearly non existant..being whittled away every year and they are right that wages have not increased, for me at least. Inflation has eaten up most of our pay increases and gas gets the rest.
What we started working for when we were young was just a carrot, dangling always just a little out of reach through our earlier working years. Nearly back at sqare one now.
No, Not Lazy, just tried of the crap.
1 0ReportSpamHANKS5 minutes agoWHY IF PAY GOES DOWN WOULD ANYONE EXPECT PRODUCTION TO NOT GO DOWN?Good question...............Answer: Lower wages is not the worst thing that can happen to you, ...............no pay, after being replaced by someone else who is available because of a glut of entry level humans .............and the future holds a near 100% chance that if the job can be learned in less than a week...................a robot is your real competition for ANY INCOME! 0 0ReportSpamshadows and dust7 minutes ago
America was hyjacked with the formation of the Federal Reserve Bank, the rest is history. Don't occupy Wall Street, prosecute it, and the architechs who set this mess into action.
France used the Guilotine, restructuring their financial sector; I wonder what we in the colonies will use
1 0ReportSpamDEA Undercover7 minutes agoC6h9l4o2e 16 seconds ago @Pha-Q123, where in the country do you live that you can say this?!! i know several people that work at The Devil store you mention in various different positions (and several that used to work there) and NOT A ONE started at $17.48. i call BS. LOL...I think he ment pesos. I call BS also. 0 0ReportSpamorigamigirl7 minutes agoI think young people are realizing that their time is more precious than material wealth. We have been a consumer driven society for so long, and that isn't necessarily a good thing. The more, more, more, mentality has had it's day.
1 0ReportSpamParker Jones10 minutes agoI wonder if "Lean Manufacturing" has something to do with our decline in productivity. Inventories are kept low because there is less demand for products because of the economy. As a result manufacturing is runng at far below capacity. 1 0ReportSpamC6h9l4o2e10 minutes ago@Pha-Q123, where in the country do you live that you can say this?!! i know several people that work at The Devil store you mention in various different positions (and several that used to work there) and NOT A ONE started at $17.48. i call BS.Pha-Q123: 8 minutes agoWalmart has a starting salary of $17.48 plus benefits for entry level ,full time workers!What's the matter,working for Walmart below your standards?
1 2ReportSpamREALLY THINK ABOUT THIS12 minutes agoWell the biggest problems is the immigrates, that came into this country thinking that you can work for minimum wage or less. also taking the jobs away from other people for less money, and not keeping the job wage were it should be and they don't care who they hurt by doing this. because they are not here for long legal or not, and also they keep sending this countries money over to there country. they do this with everything jobs ,housing and anything they get there hands on so don,t plain the Americans for that they just want to get paid what the job is worth employers take advantage of this we need to put a stop to this like i said they don't care what they do here 3 1ReportSpamwill13 minutes agoWhen you are producing garbage that enables your economic oppressors to waste the environment your life your children's future quality of life and all in the name of greed its just not worth it. People are becoming wise to this cycle of dysfunction fueled by prideful stupidity. Driving in circles everyday is going to have to stop. The gas and oil companies need to be taken over by the government instead of running it 6 2ReportSpamfofb13 minutes agoYou seem to be missing a key point here--"Baby Boomers" (that is, the older group of Baby Boomers), held onto jobs for a very long time and did not let them go to their younger brothers and sisters. There is an entire group of individuals who are 50-something who are perfectly capable of taking these jobs--but are being overlooked because some ditz thinks that the elderly have to be replaced by the very young.
If businesses are having a hard time finding people with experience--they might stop and think about how many resumes are going straight into trashcans because the 20-somethings who staff their offices throw away anything with information that suggests the person is around the age of 50 or over it. Remember that a person of Generation X--the very beginning of it--is now 48 years old. A person at the very end of the Baby Boom is now 50 or a bit over. Such people do not even get phone calls--heck, one doesn't even get an acknowledgment that the company received one's resume.
If the concern is that a person of 50-something won't stick around--young people don't hang around more than about 5 years. If the concern is that someone who is 50-something will have poor health, then hire the 50-something as an independent contractor who has to worry with his/her own health care or who has to produce or not get paid. There is no skills gap--there is a problem with the people with the skills being considered worthy of being hired--the Baby Boomers who refuse to leave think that anyone who is 50 and doesn't yet have a "career position" must be stupid, and the Generation Y'ers think that they must be dinosaurs.
No--we are neither dinosaurs nor stupid. We are the left-overs because our older brothers and sisters refused to retire and still refuse to retire. There are only so many positions to be had, you know--and we've always had seconds. Can we finally get hired? You need skilled workers, we have the skills--and we've waited long enough.
3 0ReportSpamwill14 minutes agoWhen you are producing garbage that enables your economic oppressors to waste the environment your life your children's future quality of life and all in the name of greed its just not worth it. People are becoming wise to this cycle of dysfunction fueled by prideful stupidity. Driving in circles everyday is going to have to stop. The gas and oil companies need to be taken over by the government instead of running it. 2 1ReportSpamamethyst7046414 minutes agoBased on this article, my own personal experience is that companies can only squeeze so much out of a human being. We're not Superman with an infinite supply of energy. I have seen where job expectations were continuously rising because they want to get a bigger bang for the buck, which is a lot of the reason why companies are flush with cash because they put one person in charge of the same amount of work that would be expected of multiple employees.. As companies continue to squeeze as much as they can out of workers, the moral drops drastically, people become exhausted, and they end up having nothing leftover for personal or family life. It's almost as if the job comes home to them, so they basically have to "work" all day except when sleeping. The longer that companies keep doing this, the harder it becomes for the employees to continue at the pace or demand expected. It eventually falls apart with such unrealistic expectations by companies. You can pay someone as much money as you want, but they can only do so much.So i don't think it's so much as being lazy, although there are a lot of lazy people out there, but I think it's more because people are running out of gas. The "human engine" is breaking down. 7 0ReportSpamkmd51115 minutes agoPoo Bear, you must be kidding right? Just about every "under 30" hire that comes into the company that I work for has a mentality of entitlement. They all think they should have company cars, expense accounts and blackberrys and for what? Because they were brought up by a generation of parents that told them how special they are and that the government will take care of them no matter what.Companies are in business to make money, why is that such a bad thing? I bet you don't work for free do you, but I'm sure that you enjoy your benefits. 3 1ReportSpamjcbozark16 minutes ago
This is laughable. American's are the laziest, fattest, rudest people on this planet. My wife works for a national law firm. To keep an administrative assistant or legal secretary employed is almost insurmountable. From day one they are automatically enrolled in the health insurance plan, vision, life, dental insurance at one twentieth the usual cost, less than $25 a month. The salaries are very in line with the local area, and to boot they match 10% of your yearly salary in a 401k, even if they don't participate. Yet they never show up on time, lie about their hours, leave early when the want to. But, this one is the killer, almost 90% of them will call in sick within the first two weeks of their starting date.
Never underestimate the stupidity nor the laziness of the American people. It will serve you well. And don't even get me started on this two year unemployment extension thing.
4 5ReportSpamC6h9l4o2e17 minutes agozers09, i think you have stated this very well; i would only add that shipping our jobs overseas and the government letting the various different corporations that do this get away with it, and then charge us the same or more for a product that is not made in the USA, is also a huge part of the problem. you can't find a job if it has been sent over seas.and CEO's earning corporate payouts after having raped their employees and consumers should actually be treated like a crime instead of a way to be rewarded more.from: zers09: Lazy? No. Jaded? YesI find it interesting that my grandfather, who worked a vending route his whole working life, was able to own a nice home, raise two daughters, have his wife stay at home, own two cars, and retire at age 55 with a nice pension. Meanwhile families today have both the husband and wife working, many can't afford a home, no pensions, no retirement in sight. What happened? My grandfather lived the "American Dream" driving a vending route. What happened is CEO's started taking more and giving less. 6 1ReportSpamSomeone19 minutes agoThis article kinda grinds my gears. How many years have we had stagnant wages? How many years has inflation caused the majority of us to take pay cuts? How many recent college graduates were given quality jobs? Now we are being told that we are lazy? Screw you people. My generation is not lazy; we are being oppressed by previous generations. It has never been this hard to find quality jobs. 9 2ReportSpamPoo Bear20 minutes agoThere isn't a single major corporation out there who believes in Enlightened Self Interest. I doubt they even know what that means. All that is cared about anymore is the bottom line. Every single day, it's "how much did we make this time?". And young people do get a raw deal. The haven't gotten the full story, and why would we tell them when we can just blame them for worlds problems. Them and their dang ipads. How about baby boomers take some credit for sucking the system dry... 6 5ReportSpamSomeone (clevus)21 minutes agoIf pay goes down why on Earth would anyone expect productivity to go up? I mean I realize that most employers refuse to acknowledge the connection but they know, the working man has had his employer provided pension taken away, if he is one of the lucky ones that still receives health insurance at work his required contribution has sky rocketed, the cost of fuel to get back and forth from work has doubled, inflation on the things he "has" to buy rises at a double digit rate, and the working man's hourly pay, well it has remained flat or decreased. Please stop the rubbish about American workers getting lazy, they are just trying to give their employers something closer to what they deserve. 10 0ReportSpamAnthony Wassil (Kleenrelease)24 minutes agoAre we getting lazy? Of course. Its simple to explain. Technology has made us lazy. What most people don't understand is there are two kinds of technology. The things we want technology are the things that make us lazy. TV remotes, certain cellular technology etc... The list is to large to put down. The other technology is the technology that we need. Advanced cancer screening machines, all the technology that makes us safer and healthier. I think you get my point. Advances in technology dose not mean it is good for us. You can tell what type of people own the companies that create the technology by just reading between the lines. 0 4ReportSpamSomeone24 minutes agoI work with people from all over the world. Ask anyone one of them about the work ethics in the US and they are amazed at how many hours and how hard we work. Look overseas at the work weeks and vacations they take. There are countries who have only 32 hr work weeks. In Liberia you are not allowed to work over 40 hrs a week. For me I would like to know what a 40 I hr week feels like. I have 2 jobs just to survive and provide for my family. I am not uneducated and not lazy. I would be willing to bet there are more people who work overtime or a second job then people would think. I truly believe the american worker is not lazy and definitely overworked. 9 2ReportSpam of 24 Add a commentReportPlease help us to maintain a healthy and vibrant community by reporting any illegal or inappropriate behavior. If you believe a message violates theCode of Conductplease use this form to notify the moderators. They will investigate your report and take appropriate action. If necessary, they report all illegal activity to the proper authorities.CategoriesSpamChild pornography or exploitationProfanity, vulgarity or obscenityCopyright infringementHarassment or threatThreats of suicideOtherAdditional comments(optional) 100 character limitAre you sure you want to delete this comment?/**/ DATA PROVIDERSCopyright © 2012 Microsoft. All rights reserved.
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He also theorizes that, with female-dominated sectors such as education and health care being relatively healthy parts of the economy, men are needed less and feel less pressure to work. In a recent piece in the Wall Street Journal, Murray writes:
"Whether because of support from the state or earned income, women became much better able to support a child without a husband over the period of 1960 to 2010. As women needed men less, the social status that working-class men enjoyed if they supported families began to disappear. The sexual revolution exacerbated the situation, making it easy for men to get sex without bothering to get married. In such circumstances, it is not surprising that male fecklessness bloomed, especially in the working class."
Murray suggests these feckless young adults should be the subject of public scorn. After all, Americans used to share a moral imperative to be productive contributors to society, not couch-surfers wielding armories of Apple products. Similarly, David Brooks of The New York Times, also concerned about the rise of young, listless males, suggests one fix could be subsidies from the government to encourage men to, at the very least, get married and be responsible parents to their children. (I wonder how that would fare in Congress.)
Truth is, this explanation sounds a little too easy; these aren't the first old guys to complain about "kids these days." Getting a job that will pay the bills is tough; it can seem that work doesn't pay. And fecklessness isn't the exclusive property of the young, unemployed and poor, as any number of nauseating "Real Housewives" spinoffs prove regularly on reality TV.
But their "feckless young" are my peers, and I can tell you they have a point. Clearly, there is work to be done, both literally and figuratively.
Some of us are just plain tired of the rat race. Went to work for a company for a certain pay and benefits looking forward to the time we could retire in relative comfort... being told all these years that we should save for the future and thinking benefits would be there.
Well...everything changed..benefits are nearly non existant..being whittled away every year and they are right that wages have not increased, for me at least. Inflation has eaten up most of our pay increases and gas gets the rest.
What we started working for when we were young was just a carrot, dangling always just a little out of reach through our earlier working years. Nearly back at sqare one now.
No, Not Lazy, just tried of the crap.
America was hyjacked with the formation of the Federal Reserve Bank, the rest is history. Don't occupy Wall Street, prosecute it, and the architechs who set this mess into action.
France used the Guilotine, restructuring their financial sector; I wonder what we in the colonies will use
I think young people are realizing that their time is more precious than material wealth. We have been a consumer driven society for so long, and that isn't necessarily a good thing. The more, more, more, mentality has had it's day.
Walmart has a starting salary of $17.48 plus benefits for entry level ,full time workers!What's the matter,working for Walmart below your standards?
You seem to be missing a key point here--"Baby Boomers" (that is, the older group of Baby Boomers), held onto jobs for a very long time and did not let them go to their younger brothers and sisters. There is an entire group of individuals who are 50-something who are perfectly capable of taking these jobs--but are being overlooked because some ditz thinks that the elderly have to be replaced by the very young.
If businesses are having a hard time finding people with experience--they might stop and think about how many resumes are going straight into trashcans because the 20-somethings who staff their offices throw away anything with information that suggests the person is around the age of 50 or over it. Remember that a person of Generation X--the very beginning of it--is now 48 years old. A person at the very end of the Baby Boom is now 50 or a bit over. Such people do not even get phone calls--heck, one doesn't even get an acknowledgment that the company received one's resume.
If the concern is that a person of 50-something won't stick around--young people don't hang around more than about 5 years. If the concern is that someone who is 50-something will have poor health, then hire the 50-something as an independent contractor who has to worry with his/her own health care or who has to produce or not get paid. There is no skills gap--there is a problem with the people with the skills being considered worthy of being hired--the Baby Boomers who refuse to leave think that anyone who is 50 and doesn't yet have a "career position" must be stupid, and the Generation Y'ers think that they must be dinosaurs.
No--we are neither dinosaurs nor stupid. We are the left-overs because our older brothers and sisters refused to retire and still refuse to retire. There are only so many positions to be had, you know--and we've always had seconds. Can we finally get hired? You need skilled workers, we have the skills--and we've waited long enough.
This is laughable. American's are the laziest, fattest, rudest people on this planet. My wife works for a national law firm. To keep an administrative assistant or legal secretary employed is almost insurmountable. From day one they are automatically enrolled in the health insurance plan, vision, life, dental insurance at one twentieth the usual cost, less than $25 a month. The salaries are very in line with the local area, and to boot they match 10% of your yearly salary in a 401k, even if they don't participate. Yet they never show up on time, lie about their hours, leave early when the want to. But, this one is the killer, almost 90% of them will call in sick within the first two weeks of their starting date.
Never underestimate the stupidity nor the laziness of the American people. It will serve you well. And don't even get me started on this two year unemployment extension thing.
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