Comment by snowwrestler | Hacker News Reader

Comment by snowwrestler | Hacker News Reader

Facebook gets some of my data, but in return I get a free software platform that makes it easier than before to keep in touch with my friends and family.

Like most of the U.S. economhy, it works because it is a free exchange in which both parties gain something. I could easily keep my data away from Facebook. But then I would not benefit from their services.

I think the real issue is hidden in the article--opportunity today is incredibly rich for those who have the right education...which not everyone has.

There are two issues here, actually. The first is whether our public education system is preparing youth to seize future opportunities. On the whole, I think the answer is at best mixed--but it seems solvable. We can improve our schools and make the students next year smarter than the year before. At least we have the concept of free public education as a platform.

The second is what happens to adults who lost their industries? Can a 40-something factory worker or lumberjack learn how to create Android apps that generate revenue? The answer here seems a lot worse. Not only does it seem harder for middle aged folks to radically change their professions, there are no free, and few low-cost institutions helping them do it. Online schools like Khan Academy seem exciting, but are very far from being proven answers to this problem.

There do seem to be openings in the middle--providing services to the educated people who can build moneymaking technologies. For example, I believe there continues to be a shortage in nurses nationwide. It's not easy to become a nurse or PA, but at least there are a lot of good community college programs for it.

Whenever you hear there's a "shortage" of a particular job, that usually just means wages are higher than the employers would like them to be. You can really think of that relationship either way around. e.g. – there's a huge shortage of butlers because they're just way too expensive.

One way to compensate for the suffering caused by economic dislocation is to reduce the hardship of not having a job. More unemployment and welfare aid, with less degrading means testing would help. Better would be a basic income, with income earned from working always a bonus on top.

A shortage also often refers to an inability for employers to find someone they wish to hire, regardless of what the price is.

I.e. I've interviewed a number of people in the past year or so. I only recommended hiring one of them.

I'm sure there are some brilliant people working on Wall Street right now who'd be happy to come work for you at the right price.

(Note: These questions are not meant to be snarky so please don't dog pile on the poster if he responds.)

Can you tell me what sort of position was this for (developer, scientist, "unicorn"*, etc)?

Were the parameters for this candidate search "find us someone regardless of price" or was there some notion of "market rate" attached to it?

> Whenever you hear there's a "shortage" of a particular job, that usually just means wages are higher than the employers would like them to be. You can really think of that relationship either way around. e.g. – there's a huge shortage of butlers because they're just way too expensive.

This sentiment comes from the idea that businesses facing a "shortage" can always hire good candidates by just raising their salaries. That is true, but it does not disprove a shortage--it just proves that good employees can be recruited from competitors if the wage is high enough. But if there actually is a shortage, all that does is move the shortage around.

There's also the issue of what is a sustainable salary expense in a given industry. Sure Inova could staff up with top-notch nurses if it paid them all $300k per year. But then how much would they have to charge patients to stay in business?

In the end, this a fun and easy argument to make because it requires no actual data about a given industry--just a preconception that businesses are cheap and manipulative. (Which they sometimes are--but again, that doesn't mean there's not a shortage.)

Why does Economics 101 go out the window when it comes to labor supply and demand? Rising prices increase supply until supply and demand reach equilibrium. The "sustainable salary expense" is whatever the market decides it is. Remember, prices affect the demand curve too. The specter of businesses not being able to afford labor is wholly fictional. If the market price of programmers is $300k and some businesses cannot afford nurses at $300k, that doesn't mean there is anything wrong. If the market price is $300k, that means there are companies who get much more than that in value out of each programmer, and so all that happens is that programmers get shifted from companies that generate less value to companies that generate more value.

>Why does Economics 101 go out the window when it comes to labor supply and demand? Rising prices increase supply until supply and demand reach equilibrium.

why does Dynamic Systems 101 goes out of the window when it comes to proponents of supply/demand economics? Positive feedback in a system - like rising prices increase supply - is not necessarily leads the system to equilibrium, in many cases it is a recipe for the system to swing even more widely out of equilibrium. What do they teach these days in colleges?!

Shortage doesn't mean the market doesn't clear. Of course the market will clear. Absent price controls it will always clear. But sometimes the price ends up higher than we think is good for everyone.

We think that things would be better for everyone if we could train more people to be effective programmers.

If higher wages drive higher labor supply, why haven't all the laid off factory workers gotten jobs as software developers or nurses[1]? Even the mean salaries in those industries are much higher than unemployment payments. And yet, there are labor shortages in both, and a large number of unemployed factory workers.

The answer is that it is very difficult for people to change industries. It would be like if you needed gold for a product you're manufacturing, but only iron was available. No matter how much you're willing to pay for it, iron won't do what gold does. Only mining, or transmutation, can give you what you need.

We're mining new developers and nurses by educating youth. The question is, can we transmute factory workers?

[1] Just using these industries as examples.

Who says there's a shortage of software developers? Outside the Valley and the Bay Area in general, who says mean and median software salaries are going up?

Not everyone has the aptitude to do certain jobs. I‘m never going to be a professional basketball player, and most people are never going to be professional software engineers. I think some of the best and brightest students who previously would have gone into fields like business, law, and medicine are now going into software engineering because of the hot job market. Additionally, some students who were considering graduate school end up going to work in industry right after they finish their undergraduate degrees because they’re effectively getting “bought out” by large signing bonuses and starting salaries.

> But if there actually is a shortage, all that does is move the shortage around.

The shortage should then be eliminated organically by more people being attracted to the higher wages. Therefore I tend to agree with the GP, if you are hearing about a shortage, it is probably just that employers are looking to avoid raising wages, so they are trying to make the market correct more quickly.

> The shortage should then be eliminated organically by more people being attracted to the higher wages.

Yes, eventually, but how long does that take? A temporary shortage is still a shortage while it persists.

And it takes more than just being attracted to high wages; job applicants need to have the skills and experience to satisfy the demands of the position. How do they get those? If they're a laid-off 40-something parent of 2 with a high school education? That's the big question.

Theory says people will figure out ways to become qualified for those positions unless they are actively prevented from doing so (presumably by the government, which would be a market distortion). That's why the market idea is so seductive, things take care of themselves. I think there is definitely an argument to be made that the current education system could be considered distorted, but that's not the point. The point is that if CEOs are out there begging the government to intervene to increase the supply of worker type X, it means that they are either admitting that the labor market is fundamentally broken, or they are just trying to artificially lower the wages they have to pay (or prevent them from rising). In the former scenario, we've got a broken labor market, and in the latter scenario, those CEOs are trying to break the labor market. I'm not sure which it is in the case of the STEM fields.

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