Some people formulate problems around the concept of physical limits – there is only so much of something (gold, oil, people), and when we use it all up, it’s gone. Current examples concern the ever-changing predictions of when the globe will reach the “peak” level of oil production, when we will run out of some critical metal and when we will fall over an irreversible cliff by changing our climate.
Other people formulate problems around the concept of the limitless capacity of human imagination – the ability to recognize problems before they occur and adjust by finding new ways to get more value out of existing resources and altogether new resources. Witness the revolution in oil production brought about by shale fracking technology and the exploration of ways to get energy from the sun, the wind and other natural elements never before considered “resources.”
In a similar way, this same intellectual struggle is now playing out in the far less technologically deterministic world of the labor market.
Some people say, “There aren’t enough workers. I can’t find the people I need. We have a skills gap.” Others say, “There are plenty of people. We just have to find better ways to find them, to prepare them to do the work we want done; and, perhaps most importantly, to pay them enough to attract them to where we want them to do the work.”
One side says, “We’ve reached ‘peak labor,’ and we’ll just have to go to the few places where the high-value labor exists.” The other side says, “We’ve got to be far more imaginative and precise about what we want labor to do and far more thorough in where and how we hunt for that labor.”
Just as there are mental, legal and regulatory barriers to finding imaginative solutions in the physical world, so are there similar barriers in the labor market. One of the most significant of these barriers is the increasing discrepancy between the boundaries of today’s labor markets and political boundaries that are centuries old.
Physical landforms define watersheds – areas upon which rain falls and water flows. Similarly, economic landforms, including businesses, housing stock, transportation infrastructure and community amenities, define labor sheds – areas through which workers commute to work.
Increasingly, labor sheds cross municipal and state boundaries. People live and work where they choose. Unfortunately, most labor market data are collected by political entities of long standing that are – increasingly – not synonymous with today’s labor sheds. This discrepancy is a major barrier to Maine’s economic growth.
Far too many businesses dismiss investments in Maine because “there aren’t enough skilled workers there.” This cliché ignores two important facts.
The first is that many skilled Maine workers work in businesses outside Maine and are thus not counted in a labor market defined by surveys of employers located in Maine. The second is that many skilled workers who now neither live nor work in Maine would love to relocate to Maine if they could find a comparable job (or for couples, jobs) in Maine.
To solve this problem, we need to get business decision-makers to identify, look for and use the labor market data that actually apply to their problems rather than the data that are most easily obtained.
Another barrier to finding imaginative solutions to labor market problems is a failure to ask the right questions regarding the application of new technologies. Today, the vast majority of labor market activity (at least at the initial stages) takes place online.
Every day, millions of employers post ads looking for workers, and millions of applicants post resumes looking for jobs. At the same time, scores of companies scour these sites hunting for key words – “C++ programmer,” “marketing experience,” “team player,” on and on – trying to cull from this flood of claims about jobs and skills what matches there seem to be (or not) and what jobs or claims are “trending” without any idea of what “trending” actually means.
All this robotic activity reminds me of the old saw about trying to understand “elephant” from the descriptions of five blind people describing the small part of the animal that they are feeling. How much better will our understanding be if we have 500 blind people offering their understanding?
To me, the answer to this second failure of imagination is to identify and seek the really valuable information rather than just the information that happens to be available. And this really valuable information is not what the employer and would-be employees claimed before the fact, but the criteria by which employers made their actual hiring decisions after the fact and the experience of the new employee in the job.
This post-employment information is really the area to be explored if we are to get the most value out of the people we already have. And it will be information obtained not by bots crawling online job sites, but by more imaginative extraction of post-employment information by employers.
Only by imaginatively exploring the depths of our human resources will we be able to accelerate sluggish job growth and restore prosperity, both in Maine and the nation as a whole.
Charles Lawton is chief economist for Planning Decisions, Inc. He can be contacted at:
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