4 ms·

Of course it's a lie. Like with many industries, worker 'shortages' only exist at the price level the corporations want to pay. So they artificially inflate s

by Mikeb85 11y ago

Of course it's a lie. Like with many industries, worker 'shortages' only exist at the price level the corporations want to pay. So they artificially inflate supply to lower wages. Nothing new here.

cortesoft 11y ago
I am not sure what you mean by 'want to pay'. It isn't like the companies that can't pay higher prices are rolling in profit. The companies that DO make a lot of money DO pay their engineers good wages. It is just that most companies tech workers don't add enough profit to afford their work. If a company will make $100k extra in profit a year from the work a developer does, but the worker capable of doing that costs $150k a year, that company isn't going to be able to hire the worker. It isn't about 'wanting to pay them less' it is about the fact that every worker needs to produce more value than they cost, or the company will go out of business .
- tankerdude 11y ago
  So that specific company either doesn't hire, or hires for less compensation, if they can find it. But that doesn't mean that there's a shortage of workers. It means that that company isn't paying the market rate and thus will pull the good old H1B trick.
  - cortesoft 11y ago
    If lots of companies that have a need can't fill that need at a price they can afford, that is by definition a shortage. Of course a company could hire a worker if they spent enough money; even in the middle of a famine, you can find food if you have enough money. Are there a lot of engineers sitting around unemployed, not taking these jobs that are offered because they aren't paying enough? I don't think that is the case - if there were, those people would start taking those jobs at the lower pay. Since this isn't the case, imagine what you say starts happening - those companies with openings raise the pay enough to find a candidate. Where do you think that person is coming from? Not a pool of unemployed engineers, but from a pool of engineers working at other companies. So now, that other company has an open position. You have not changed anything, just shifted the problem to another company. Sure, an individual company can deal with a shortage by just paying more, but that doesn't fix the industry wide issue. I know as engineers, the shortage is great for us. It drives up our wages, and it benefits me greatly. I make a lot more than most other industries. But that doesn't mean there isn't a shortage.
    - tankerdude 11y ago
      The pool of unemployed engineers is of decent size, especially people who are over 40. We know that ageism exists in tech, and many are deemed not even worthy of an interview. I will also disagree that these companies "cannot afford it". Who are the ones complaining? They are mainly very large corporations, or at least the ones that are being heard. Do you really think that hiring of an engineer here will make it so that they will become unprofitable? It's the old saying of, "if you've been unemployed for X number of months, you will get shunned". So again, it's supply/demand. If you want to pay less, why not just hire give the unemployed guys a shot at that lower pay? It's part of doing business. So pay less for less quality, but that's not what companies want. They want to pay less but for a higher quality. Like all things economics, we can have a substitute. It might be an inferior one, but you're not sure. As far as wages, meh. I dunno. Once you hit a certain level these days, you kind of top out in engineering, or what people _want_ to pay. And the top of the graph gets dragged down by the sheer number of H1Bs.
- sbov 11y ago
  How is this a problem? It's like saying that there's a shortage of X because I have a business idea that won't work unless I can pay all my workers minimum wage.
  - cortesoft 11y ago
    Whether it is a problem or not can be debated, but it IS a shortage. If we don't say this is a shortage, then nothing ever would be, unless there is literally 0 supply of something. As long as there is at least 1 of something, there will always be at least SOME price you could pay to get it. In economics, a shortage means the price of something fails to rise to reach an equilibrium, which is EXACTLY this situation: https://en.wikipedia.org/wiki/Shortage https://en.wikipedia.org/wiki/Shortage
    - cortesoft 11y ago
      Actually, I think I am wrong. The price HAS risen, but lots of people can't or won't pay. This doesn't meet the technical definition of a shortage: In common use, the term "shortage" may refer to a situation where most people are unable to find a desired good at an affordable price, especially where supply problems have increased the price. "Market clearing" happens when all buyers and sellers willing to transact at the equilibrium price are able to find partners. There are almost always willing buyers at a lower-than-market-clearing price; the narrower technical definition doesn't consider failure to serve this demand as a "shortage", even if it would be described that way in a social or political context (which the simple model of supply and demand does not attempt to encompass).
    - deleted 11y ago
      [deleted]
- stcredzero 11y ago
  There's probably enough hysteresis and softness in the market, such that job markets that are pricing the wages too high will retain their error long enough to drive a lot of companies out of business that wouldn't have failed if wage levels were set perfectly.
refurb 11y ago
I don't think that's true in the short run. If there are 4 people in the US who have the skills to do a job, but you need 8, you have a shortage. It doesn't matter how much you offer for the role, you only have 4 skilled workers. Of course in the long run, that doesn't hold true.
- jellicle 11y ago
  Is there any company in the U.S. that needs more tech workers than exist in the United States or can come to the United States to work? If not, your example is silly. No company needs more than a tiny fraction of all the workers. Any company can fill its tiny fraction, if it wanted to, by simply increasing wages.

by Mikeb85 11y ago

Of course it's a lie. Like with many industries, worker 'shortages' only exist at the price level the corporations want to pay. So they artificially inflate supply to lower wages. Nothing new here.

cortesoft 11y ago

I am not sure what you mean by 'want to pay'. It isn't like the companies that can't pay higher prices are rolling in profit. The companies that DO make a lot of money DO pay their engineers good wages. It is just that most companies tech workers don't add enough profit to afford their work. If a company will make $100k extra in profit a year from the work a developer does, but the worker capable of doing that costs $150k a year, that company isn't going to be able to hire the worker. It isn't about 'wanting to pay them less' it is about the fact that every worker needs to produce more value than they cost, or the company will go out of business .

tankerdude 11y ago
So that specific company either doesn't hire, or hires for less compensation, if they can find it. But that doesn't mean that there's a shortage of workers. It means that that company isn't paying the market rate and thus will pull the good old H1B trick.
- cortesoft 11y ago
  If lots of companies that have a need can't fill that need at a price they can afford, that is by definition a shortage. Of course a company could hire a worker if they spent enough money; even in the middle of a famine, you can find food if you have enough money. Are there a lot of engineers sitting around unemployed, not taking these jobs that are offered because they aren't paying enough? I don't think that is the case - if there were, those people would start taking those jobs at the lower pay. Since this isn't the case, imagine what you say starts happening - those companies with openings raise the pay enough to find a candidate. Where do you think that person is coming from? Not a pool of unemployed engineers, but from a pool of engineers working at other companies. So now, that other company has an open position. You have not changed anything, just shifted the problem to another company. Sure, an individual company can deal with a shortage by just paying more, but that doesn't fix the industry wide issue. I know as engineers, the shortage is great for us. It drives up our wages, and it benefits me greatly. I make a lot more than most other industries. But that doesn't mean there isn't a shortage.
  - tankerdude 11y ago
    The pool of unemployed engineers is of decent size, especially people who are over 40. We know that ageism exists in tech, and many are deemed not even worthy of an interview. I will also disagree that these companies "cannot afford it". Who are the ones complaining? They are mainly very large corporations, or at least the ones that are being heard. Do you really think that hiring of an engineer here will make it so that they will become unprofitable? It's the old saying of, "if you've been unemployed for X number of months, you will get shunned". So again, it's supply/demand. If you want to pay less, why not just hire give the unemployed guys a shot at that lower pay? It's part of doing business. So pay less for less quality, but that's not what companies want. They want to pay less but for a higher quality. Like all things economics, we can have a substitute. It might be an inferior one, but you're not sure. As far as wages, meh. I dunno. Once you hit a certain level these days, you kind of top out in engineering, or what people _want_ to pay. And the top of the graph gets dragged down by the sheer number of H1Bs.
sbov 11y ago
How is this a problem? It's like saying that there's a shortage of X because I have a business idea that won't work unless I can pay all my workers minimum wage.
- cortesoft 11y ago
  Whether it is a problem or not can be debated, but it IS a shortage. If we don't say this is a shortage, then nothing ever would be, unless there is literally 0 supply of something. As long as there is at least 1 of something, there will always be at least SOME price you could pay to get it. In economics, a shortage means the price of something fails to rise to reach an equilibrium, which is EXACTLY this situation: https://en.wikipedia.org/wiki/Shortage https://en.wikipedia.org/wiki/Shortage
  - cortesoft 11y ago
    Actually, I think I am wrong. The price HAS risen, but lots of people can't or won't pay. This doesn't meet the technical definition of a shortage: In common use, the term "shortage" may refer to a situation where most people are unable to find a desired good at an affordable price, especially where supply problems have increased the price. "Market clearing" happens when all buyers and sellers willing to transact at the equilibrium price are able to find partners. There are almost always willing buyers at a lower-than-market-clearing price; the narrower technical definition doesn't consider failure to serve this demand as a "shortage", even if it would be described that way in a social or political context (which the simple model of supply and demand does not attempt to encompass).
  - deleted 11y ago
    [deleted]
stcredzero 11y ago
There's probably enough hysteresis and softness in the market, such that job markets that are pricing the wages too high will retain their error long enough to drive a lot of companies out of business that wouldn't have failed if wage levels were set perfectly.

refurb 11y ago

I don't think that's true in the short run. If there are 4 people in the US who have the skills to do a job, but you need 8, you have a shortage. It doesn't matter how much you offer for the role, you only have 4 skilled workers. Of course in the long run, that doesn't hold true.

jellicle 11y ago
Is there any company in the U.S. that needs more tech workers than exist in the United States or can come to the United States to work? If not, your example is silly. No company needs more than a tiny fraction of all the workers. Any company can fill its tiny fraction, if it wanted to, by simply increasing wages.