Eric Isbister - AssholeA couple of weeks ago, my father asked me about a 60 Minutes segment in which some manufacturing executive complained that he couldn't find skilled workers who knew trigonometry. My father didn't know exactly what trigonometry was, but it seemed like some advanced math. So he was confused why a job that required advanced math only paid $12 per hour. I agreed with him. Really, if such works are in demand yet scarce, surely the solution is to raise the rate of pay.

I explained to my father—who is naive in many ways—that this was an old story. The executives should be honest and say, "We can't find high skilled workers for low skilled pay." The truth must be that they don't really want to hire people—they just want to complain. The truth is that if they were truly desperate for workers, they would hire smart people and train them—like companies used to.

Last week, Adam Davidson wrote a very interesting article at the New York Times, Skills Donít Pay the Bills. He talks about the fact that employers are lying about the "skill shortage." This is embarrassing:

Eric Isbister, the C.E.O. of GenMet, a metal-fabricating manufacturer outside Milwaukee, told me that he would hire as many skilled workers as show up at his door. Last year, he received 1,051 applications and found only 25 people who were qualified. He hired all of them, but soon had to fire 15. Part of Isbister's pickiness, he says, comes from an avoidance of workers with experience in a "union-type job." Isbister, after all, doesn't abide by strict work rules and $30-an-hour salaries. At GenMet, the starting pay is $10 an hour. Those with an associate degree can make $15, which can rise to $18 an hour after several years of good performance. From what I understand, a new shift manager at a nearby McDonald's can earn around $14 an hour.

Note that Isbister doesn't just pay poorly.[1] Of the qualified people he found, he fired 60% of them because he doesn't abide strict work rules. What could that mean? State mandated breaks? Occupational safety? I don't know, but it is clear that there are a lot more reasons to not work for Isbister than the poor pay. But I don't want to make too big an issue of this. Eric Isbister is just a good example of the assholes who head America's businesses.

Davidson notes a very damaging aspect of all this fake talk of a skills gap: it is creating a real skills gap. Young people who go to school to get these vaunted in-demand skills quickly learn that they are qualified to take jobs that pay no more than McDonald's. And so they leave the profession for something that will pay their bills—or at least where they don't have to deal with assholes like Eric Isbister. Currently, highly skilled manufacturing workers are old and will soon retire from jobs that pay reasonable salaries. Who will be around to take these jobs? Will these employers go the way of GenMet and lower their wages in the hope that that will draw the workers in?



[1] Given that Isbister is so cavalier about finding workers, I can see how he might think of himself as the mythical job creator. In his case, he clearly doesn't care about maximizing the amount of product he can produce. He just staffs his factory with people he considers deserving. Of course, this makes him a very bad businessman. And that makes him very bad for job creation. If he just tried to maximize profits, he would employ more people. So Eric Isbister isn't just an asshole, he's also an idiot.