32 ms·

Blue-collar wages are surging. Can it last?

261 points by artsandsci 9y ago

ocschwar 9y ago
Plumbers can't telecommute.
- deleted 9y ago
  [deleted]
- onion2k 9y ago
  I imagine there's an opportunity for a startup that let's someone who wants to do a simple job themselves Facetime with a plumber to talk them through the work. No idea if there's any profit in it though.
  - baxtr 9y ago
    Love it! But, in many countries regulation/ warranty might kill such an idea.
  - strictnein 9y ago
    I imagine lots of this: "Lefty loosey, righty tighty... no no your other left"
    - antisthenes 9y ago
      "...and now your house is flooding at 3 GPM"
  - cma 9y ago
    Microsoft did a marketing demo of that (Skype Hololens): https://bfgblog-a.akamaihd.net/uploads/2015/01/hololens-plumbing-e1422571078912.jpg https://bfgblog-a.akamaihd.net/uploads/2015/01/hololens-plum... (it was faked, the remote guy was drawing with a tablet, but somehow it worked in 3d like tilt brush..)
  - bdamm 9y ago
    "Now grab a 3ft section of copper tubing, cut it to length with your pipe cutter, bend it with your copper bending tool, and flare it with your flare clamp... what, you don't have any of those? Wellll.."
    - alextheparrot 9y ago
      Great! There’s an opportunity for same day rental delivery here too
      - toyg 9y ago
        And in the end you'll have spent more than you would have with a regular plumber, you'll have a bunch of tools you won't need for another 10 years, and the job will look terrible. Source: had to retile a bit of a floor, too small to interest a real tiler. Guess how it looks now?
        jerkstate 9y ago
        I'm not a professional but I cracked a tile on my kitchen counter and replaced it and you can't tell. Likely difference between you and me? My uncle is a tile man and he walked me through the whole process (remotely), from finding a matching replacement tile and grout to what kind of tile glue works best for this kind of tile to grouting and cleaning.
        monocasa 9y ago
        > And in the end you'll have spent more than you would have with a regular plumber, you'll have a bunch of tools you won't need for another 10 years, and the job will look terrible. That part of the business model worked well for Home Depot.
        ryandrake 9y ago
        As someone who does as much as I can around the home myself, this attitude baffles me. I consider my tools and knowledge a financial investment: most are used at least monthly, some weekly. I'd never be able to afford living in my home if I paid a contractor to come out every time my toilet leaked. Likewise, my car ownership costs would increase substantially if I paid a mechanic $100 to change the oil or $1000 to service the brakes. Also, most light everyday home maintenance work like laying tile, building a fence, framing a wall, installing plumbing, etc. is not rocket science. You don't have to be Bob Vila or go to trade school for years to learn how to do it.
  - westbywest 9y ago
    A substantial factor in licensed tradespersons' ability to collect the wages they get is that many situations require the work be done by a license holder. For example electrical or plumbing repairs done to satisfy a building code violation are often expected to have permit paperwork documenting the repair. License = ability to pull permit.
    - thanatropism 9y ago
      What, can't a tradesman certify that a job was done to code remotely? We allow people to get degrees online. Of course, some things (is the screw really tight?) can't be verified by video only, but possibly one could devise smarter tools like pressure gauges and some such that can be shown over a video call.
      - TheCapn 9y ago
        I'd be curious what the cost savings in the end were regardless. An untrained hand takes so much longer to complete a task that a professional is used to regardless of the understanding. Do you want to slog along a journeyman in video conference for 8 hours or hire him for 2? What's your cost going to be with either? Beyond that a lot of physical tasks can be done blind, does he "see" that you've threaded the hose properly or applied the compound properly when you're doing it by feel as your eyes can't reach behind whatever you're working at? I like the idea but I always relate back to my own real world experiences and think about how inefficient it is to remotely task with someone. Ever try helping your parents navigate their computer over the phone? Imagine doing that with a professional @ $100/hr or whatever to replace your faucet or wire new fixtures and run cabling to a breaker panel
      - westbywest 9y ago
        The licenses tradesmen carry also tend to be paired with some sort of insurance or bond to back up the fitness of their work. Were it my plumber's license and liability coverage, for example, I'd be hesitate to approve a sweated pipe weld just from video footage. And the market for cheap sonar/magnetic gadgetry or whatever for laypersons to inspect the welds on bathroom plumbing probably just isn't there.
  - PeterisP 9y ago
    What's the business model there? If the job would take a plumber 30 minutes, it'll take me an hour - so instead of paying a plumber for 30 minutes of work, I'd need to pay him for an hour of supervision; so I'd be paying more for the privilege of doing it myself.
    - alextheparrot 9y ago
      Presumably a single plumber could handle multiple clients, plus you are already paying for his commute, which you probably don’t need to do (in your own house)
      - throwawayjava 9y ago
        I could see some combo of youtube, tool rental, and a live helpline with trained blue collar workers as a fallback.
  - bpicolo 9y ago
    You'd have to pay a plumber -more- to wait for you to do it, because you're going to be less efficient
    - onion2k 9y ago
      I was thinking more like having someone assess the job, point out potential tricky bits, advise on different approaches, etc before you start. Like I said, I have no idea if there's a profitable business there, I was just suggesting a way a plumber could actually work remotely.
  - ceejayoz 9y ago
    My dad helped me disassemble a lawnmower to fix a carburetor float once via Facetime, and I felt like a living Apple commercial when it started back up on the first pull, especially considering I didn't know what a carburetor was beforehand.
  - 52-6F-62 9y ago
    That would be pretty funny, but plumbing can be pretty damned complex work. I could see some potential in apprenticeships taking place remotely, though. At least in the latter years of one. And maybe compliance tests, journeyman tests, etc — depending on the nature of the work. And in that case, less Skype, and more AR.
    - humanrebar 9y ago
      The risk is pretty high, too. Instead of a $300 p-trap replacement, you can do it yourself, but if you do it wrong, you can have 4-5 figures of accidental water damage to the house.
      - 52-6F-62 9y ago
        Absolutely! And that's just in your bathroom wear-and-tear maintenance. Never mind commercial plumbing! Small business owners trying to sort out a commercial block backup caused by a grease-trap failure could start to turn out a few issues... Plumbers deserve higher regard than they're given (all great plumber jokes aside). That said if the tech could be used to improve the training of specialists in remote areas/ areas that might be short a few journeymen or master tradespersons, or aid in especially complex problems, it could be a huge boon and reduction in cost (eg - travel costs).
  - matt_wulfeck 9y ago
    DIY always breaks down when you need to purchase an expensive tool that you only use once.
    - abfan1127 9y ago
      I wouldn't say always. I usually ask my friends if they have the tool and borrow it, or buy it knowing someone will likely borrow it in the future.
    - bluGill 9y ago
      Fortunately most of the tools you don't use once. The few you do tend to be the types of tools a pro would rent as well.
    - ceejayoz 9y ago
      Tool libraries are a pretty neat solution to this. Some local book libraries are getting into it as a way to expand services.
    - dcherman 9y ago
      Define expensive. 200$? That's the cost of the plumber's time, and now I've got that tool forever. That and I've gained knowledge and know how to fix or build something that I didn't before which is something I take pride in. In my experience, there's been very few things where it makes more sense long term to just pay someone else to do it so long as you're willing to do a little bit of learning.
  - hiram112 9y ago
    I tried to fix numerous issues with my car and in my apartment by following very clear and detailed YouTube videos. Unfortunately, it's the little things that usually push me to give up and hire a pro - wrong tools, don't know the tricks to get a tight screw loose, etc. It's not dissimilar to how many non-technical PHBs watch developers typing away, and figure they can just get a random worker for half-price to copy the same code from a book or website. In reality, it's not the actual code - many times which can just be copied - that makes a good developer worthwhile, it's the years of experience to know what to do when something goes wrong.
  - myth_drannon 9y ago
    I'm not allowed to cut a tree in my backyard because it's close to power lines, only licensed arborist. I CAN do it but not allowed, so it's just a legislation not an issue of knowledge.
    - m0llusk 9y ago
      Trimming trees near power lines is extremely dangerous and can lead to deadly electric shocks even simply operating near power lines. Metal ladders and tools can draw current from lines to ground and to a great deal of damage. Arborists have special training and tools to prevent deadly electric shocks when trimming trees near power lines.
  - jaymzcampbell 9y ago
    I worked at a startup doing exactly this last year[1], [2], [3]. Unfortunately, the parent company shut us down after we ran out of runway but it was starting to gain traction. One issue we had was ultimately a lot of people wanted someone to come out anyway and to make sure we had the right quality (and so gain customer/brand trust) we had to do this in-house - i.e. hire actual plumbers and handymen to be on call as well as building logistics software to support all of this entirely outside of the video call aspect. It was more than a bit depressing the parent company pulled the plug because it really did feel like it was about take off. Maybe we could've instead integrated into a set of preferred suppliers cross country as a lead gen service. Though if you read the TrustPilot reviews it was the fact we were the whole package that customers loved. We started by first charging for calls but in order to grow switched that to free calls with the assumption that people would then book a home visit if needs be. Nobody wanted to pay £10 on a call and find out they needed a plumber to come out. It felt like something that with Uber-style levels of investment (i.e. tons) could be pretty profitable if you owned the sector. To expand on our offerings we would do things like allow people to simply book a handyman for an hour to do whatever - put up a curtain rail, fix that loose light fitting and so on. People were using the video aspect as a precursor to someone actually coming to do the work so the video bit was never the end of the transaction. As soon as you start needing a team of people to field customer calls, do support and manage your countrywide team of tradesmen it gets expensive. [1] https://uk.trustpilot.com/review/dad.co?page=2 https://uk.trustpilot.com/review/dad.co?page=2 [2] http://www.eu-startups.com/2016/05/london-based-dad-secures-2-million-to-launch-diy-video-visit-service/ http://www.eu-startups.com/2016/05/london-based-dad-secures-... [3] https://s3.amazonaws.com/poly-screenshots.angel.co/enhanced_screenshots/423633-original.png https://s3.amazonaws.com/poly-screenshots.angel.co/enhanced_...
    - GFischer 9y ago
      Well, having someone over video sounds like it would have value :) (even though eventually you get a house visit), I'd love that service. I have some exterior window blinds that need fixing, I'd love for someone to see it over a video call and get a quote before them coming. That startup sounded great, I'm sad it failed :(
margorczynski 9y ago
Does every paragraph needs to rephrase that it isn't thanks to Trump? Maybe I'm wrong but lately it seems every US media outlet needs to mention him this way or another in every topic possible (positive or negative light)
- warriormonk5 9y ago
  The Economist is a British publication
- rm999 9y ago
  I think you may be underestimating the importance of this article to US politics. One of the biggest issues in the 2016 election was stagnating blue-collar wages - it was one of Trump's main platforms, and one of the main factors that made him President. If the economy continues to do well across all income levels, regardless of why, and regardless of how unpopular Trump remains, there is a good chance we will see a second Trump term. As much as I dislike him, Scott Adams made this exact argument recently: http://blog.dilbert.com/2017/10/14/low-public-approval-of-president-trump-yet-unusually-high-consumer-confidence-hmmm/ http://blog.dilbert.com/2017/10/14/low-public-approval-of-pr... As Bill Clinton said, "it's the economy, stupid".
  - thanatropism 9y ago
    Did you begin disliking Scott Adams when he became a Trump booster, or...?
    - victor106 9y ago
      No. When he let it out that 1. He supports the NRA even after the recent gun violence 2. When he supported Trumps statements during Charlottesville 3. When he keeps saying on Twitter how the alt-right is so correct.
    - ffhhfyy55 9y ago
      He’s long been a minor celebrity with delusions of grandeur. His blog stuff comes off as no better informed than a typical cable news watcher But he makes comic strips that show how everyone else is the idiot so there’s that So of course he’ll fit right in with the tech crowd
danielvf 9y ago
I worked with small / medium manufacturers in the prosperous part of the Southeast. Hiring is brutal currently. Last week one company setup interviews with 20 possible new workers. One showed up for his interview, and one wandered in the next day. 18 nonshows. Another local company is seeing 50% of new hires failing their first drug test. Anecdotaly, about 20% of new hires under 30 don’t understand the concept of showing up on time (or at all) even after that’s explained as a part of orientation. Sub $160,000 houses (3-4 bedrooms, land, average schools, 15-30 minute commute) are now selling in 1-3 days, compared with 3-6 months five years ago. There’s definitely a boom getting started here.
- deleted 9y ago
  [deleted]
- QAPereo 9y ago
  This is what over 40 years of gutting education and social safety nets bought us. Idiocracy is coming!
  - TheAdamAndChe 9y ago
    No, this is what happens when employers show their workers absolutely no loyalty over decades. If people have no reason to care about their job, they won't care about it. The labor market is tight enough so that they can't just fire everyone who behaves like that, otherwise everyone would quit.
    - QAPereo 9y ago
      That’s a factor, but the collective dumbing down is as well. We now have a nearly feral workforce and body politic, because contrary to expectations, they’re unpredictable and hard to control.
      - TheAdamAndChe 9y ago
        > the collective dumbing down is as well Graduation rates are are higher than ever. Over 30% of people have Bachelors degrees or higher. Literacy rates are higher than they ever have been. Our people aren't dumber, they just realize that when the business managers and owners are making millions while they don't get wage increases above inflation, they have no incentive to care.
PatientTrades 9y ago
Illegal border crossings on the southern border are down 78% and blue collar wages are rising. Of course correlation does not equal causation, but when there are fewer available workers to hire/train and demand remains constant, wages tend to rise.
amriksohata 9y ago
The gap is closing but it means amenities are getting more expensive and since the people in the middle aren't getting raises it just isn't attractive to work in a smarter role
- TheAdamAndChe 9y ago
  Right, and as fewer people go into middle class jobs, demand for those workers will increase and will lead to increased wages. This is what inflation is. It's all a function of supply and demand.
  - thrillgore 9y ago
    It'll be either an increase in wages, or increase in visas for that kind of labor from overseas.
    - amriksohata 9y ago
      Or worse the businesses decide to open shop abroad the jobs disappear from the local market
      - TheAdamAndChe 9y ago
        Hence the growing disdain for globalization. It's a race to the bottom to see what country will provide the lowest wages and quality of life for its workers.
        amriksohata 9y ago
        Interesting way of looking at it, and capitalism in general
xefer 9y ago
Since this article focuses on the U.S., how much of this is related to the slowdown in illegal immigration?
- danielvf 9y ago
  Probably none [edit: in manufacturing]. Most illegal immigrants don’t work manufacturing. The three most common jobs for illegals around here are construction, yardcare, and building cleaning via nested subcontractors. Manufactures have hard assets they could loose. Sketchy subcontractors can just disappear and rename. The growth is from the demand side - people are buying more right now.
  - gthtjtkt 9y ago
    > Probably none. Most illegal immigrants don’t work manufacturing. You say that as if the jobs taken by illegals exist in some alternate universe where simple economic principles don't apply. If an illegal immigrant's job is vacant (because he couldn't enter the country) and a would-be manufacturing worker fills that job, that obviously has a direct impact on the manufacturer's ability to hire that worker. He's no longer looking for a job because he filled a vacancy left by an illegal immigrant.
    - Xylakant 9y ago
      This makes little sense. Illegal immigrants usually occupy the least qualified and least-paid jobs. Few persons that are qualified to apply for a manufacturing would rather apply for a job that an illegal immigrant could get.
      - gthtjtkt 9y ago
        Do the illegal immigrants take those jobs because they pay so little, or do those jobs pay so little because there has always been a steady supply of illegal immigrants desperate to fill them at below-market prices? If your business model relies on wages being suppressed by those illegal workers, then maybe your business deserves to go bankrupt when the supply dries up and Americans start demanding $15/hour.
dionidium 9y ago
I work at a medium-sized software company. We've had similar problems with younger employees. Guys literally posting in company-wide Slack channels that they're "feeling a little sleepy this morning, gonna be in later." Can you even imagine somebody saying that to their boss in some black-and-white movie from the 1940s? "Hey, how about instead of coming in later you hit the bricks and never come back?" The culture has definitely changed. It's wild.
- nesyt 9y ago
  Are you against this? Flexible working hours that can bend to accommodate very malleable human lives seems better than rigid adherence to traditional schedules for the sake of it.
  - alexanderstears 9y ago
    It's important that businesses answer the question and stick to it. Do they want people to work a set schedule or not? Or businesses can make demands, but in this labor market they'll have to pay for people to meet 'em. I can promise to be in my chair at 9 am everyday, but I want to leave at 5 and if I'm tired, the business gets to pay for a less than productive day.
    - humanrebar 9y ago
      If they want me commuting during both morning and evening rush hour, they better pay a premium over companies that let me work around commuting. The extra 30+ minutes per day stuck in traffic or on trains does not come for free.
      - deleted 9y ago
        [deleted]
  - Y7ZCQtNo39 9y ago
    Yeah, if a person really feels the need to sleep in, I can't imagine their productivity would be much different if you had a culture for pressuring for adhering to schedules. I think many people to fail to realize that writing software is very unlike producing widgets in a factory line. Some people hit periods of high productivity when they work quietly, alone, for an hour or two. And you might get more in that 1-2 hours than you would all day with the constant distractions in the modern office.
thanatropism 9y ago
This comment (not by me; the poster name isn't even visible anymore): > Illegal border crossings on the southern border are down 78% and blue collar wages are rising. Of course correlation does not equal causation, but when there are fewer available workers to hire/train and demand remains constant, wages tend to rise. was marked dead. Why? Is the illegal crossing number wrong/fake news?
- ben_jones 9y ago
  Whatever the crossing number is I don't believe it. There is too much incentive for the number to be artificially higher or lower. Politicians in border states want it low. Border patrol want it low. Feds want to show marked "improvement".
- stemc43 9y ago
  illegals dont have SSNs. EMployers have to run ssn verification before they hire you. These checks are instant and this will popup immediately. Can they still hire you - well maybe for janitorial -> manufacturing jobs I'd say highly unlikely.
  - smallnamespace 9y ago
    This is definitely not the case. E-Verify has existed for a long time, but is still not mandatory [1]. Employers are supposed to have employees fill out an I-9 form that verifies employment eligibility, but the penalties for noncompliance are at most $1,100 per form -- basically slap on the wrist territory [2]. The irony here is that the anti-immigration wing of the Republican party is now in open conflict with the business wing of the party, which benefits heavily from hiring ineligible workers for low wages. [1] https://en.wikipedia.org/wiki/E-Verify#Operations https://en.wikipedia.org/wiki/E-Verify#Operations [2] https://www.thebalance.com/i-9-form-employment-eligibility-verification-form-1918902 https://www.thebalance.com/i-9-form-employment-eligibility-v...
    - ryanmarsh 9y ago
      I've never used E-verify. I just use people's I-9. Everyone I've ever hired was born in the US so I never thought about this.
seibelj 9y ago
I keep reading that AI is going to eliminate all the jobs. Yet unemployment is at record lows and wages are rising across the board. Could it be possible that AI will instead free people to work on new jobs in new industries? Amazing! It’s almost like this time is not any different from any other time.
- ffhhfyy55 9y ago
  Yeah all those retail and manufacturing workers can jump right into coding and medicine no problem when robots take over It’s just that easy!
- bpicolo 9y ago
  There are other factors though, e.g. underemployment.
- bantunes 9y ago
  It's the first time we're automating legal casework and medical diagnostic work. Rest assured: it is different.
- ceejayoz 9y ago
  The last massive shift like this led to multiple world wars. Let's not pretend there aren't legitimate concerns about the impact of AI on society - unemployment numbers are only one part of the story.
- throwawayjava 9y ago
  There was a long lag between the time when companies invested in hardware and the time when worker productivity started really picking up. And a lot of the job reduction didn't happen in firings, it happened in not replacing retirements. Unemployment lags behind productivity increases. Productivity increases lag behind tech adoption. Tech adoption lags behind innovation. innovation lags behind technology maturation. technology maturation lags behind science. A lot of the transformation automation is in the "science/maturation" or the "innovation" phases.
- Density 9y ago
  Overwhelming number of jobs created in the last decade are very low quality gig economy jobs. People work, but they're severely underemployed.
neves 9y ago
The article says no, but are there any dissented view that sees a causation between Trump policies and the rise in blue collar wages? Please, polite answers only. I'm just a foreigner that want to understand a little more.
- SamReidHughes 9y ago
  One way that Trump helped is that the illegal migration rate dropped as soon as he came into office. He scared people out of even trying. You've also got his halt to the ever-expanding regulatory environment and his opposition to the TPP.
  - eru 9y ago
    Did they actually drop? From what I remember, illegal migration has been dropping for years now.
- sailfast 9y ago
  Not a "dissenter" per se, just a rational human trying to draw connections: In service positions, I could see a rise in wages attributed to those jobs that might have previously been filled with migrants. I might see legal immigration also being discouraged, but to be honest that includes tourism from abroad which is shrinking and potentially having a negative impact on the service sector. The only direct _policy_ link I can see is not a policy but rather a "business friendly" climate that might lead companies to start to invest more, understanding that they probably won't be taxed or regulated more heavily in the next 3 years. That, plus cheap credit (a big overheat risk IMO) means opportunities for growth. In terms of actual policy, I'd say not much has happened but rather the economy is now recovering from the housing crisis and growth has picked up again across the board. This was occurring before Trump, and will continue until another systemic issue occurs and people panic I'd imagine. That said, in my opinion, Presidents rarely have much to do with economic outcomes except to either inject risk / instability with policy initiatives or pronouncements. Some big policies have costs, but most of the day to day impacts are quite spread out. There has been no action yet on health care or taxes that would influence employer direct costs. Perhaps some regulation has not been implemented and some executive orders rolled back, but nothing that would impact markets.
pure_ambition 9y ago
No it won't last, because as soon as the wages start coming up then the fed will say "inflation is heating up" and raise interest rates, causing businesses to spend more on debt service and less on employees.
- smallnamespace 9y ago
  Higher rates only affects new issuances of bonds, rolling over of existing debt, or bank loans (which are a small fraction of the total debt market in developed economies). The average maturity of a corporate bond is now 15+ years, and most bonds pay a fixed interest rate that doesn't vary due to current rates [1]. That means that any change to rates will not have much of an immediate impact on the interest expense line item. On the other hand, it will actually increase the interest income they receive on their cash balances. [1] https://www.ft.com/content/41213b02-b87e-11e6-ba85-95d1533d9a62 https://www.ft.com/content/41213b02-b87e-11e6-ba85-95d1533d9...
  - soVeryTired 9y ago
    You think rolling over of debt and new issuance is less important than interest income?
    - smallnamespace 9y ago
      No, but the 15+ year plus maturity of existing debt stock means that on average, borrowers won't need to go back to the capital markets any time soon. Slightly oversimplified way to think about it: every year companies need to refi only 1/T of their debt, where T is the average maturity.
  - Symmetry 9y ago
    Not to necessarily agree with the OP's prognosis, but the Fed rate also affects inflation which can affect the viability of every contract written in terms of dollars when it strays from where it's expected to be.
- runeks 9y ago
hyperion2010 9y ago
I had a long talk with a guy getting his general contractor's license yesterday. He told me that down in San Diego they are continually short on construction workers, so much that one of his friends said that there is 10 years worth of construction that needs to be done and no one to do it. Wages at ~$45/hr, and probably rising, some projects paying perdiems for commutes from Orange County. Strange.
- gjem97 9y ago
  I always find it a bit strange when people talk about shortages of non-price-controlled goods and services. When you say that the industry is "short on construction workers", there's an implicit "who will work for what we used to pay them." It seems to me like it's someone who hires in that industry trying to entice more talent to come help lower the price again, rather than an accurate description of the state of the world. To be sure, bona-fide shortages can occur transiently. For example when a natural disaster happens, it will take time for the local tradesmen to work through the backlog. But at a relatively steady state, it seems silly to talk about a shortage of construction workers. Pay a bit more than the next guy, and my guess is, your shortage will quickly disappear.
  - sharemywin 9y ago
    You can't just raise prices and expect to win jobs.
  - adventured 9y ago
    You can't just create 100,000 new construction workers in San Diego because you raise wages from $45 to $60 per hour. Labor availability + skill + time + market awareness = it takes a helluva lot longer than months or 2-3 years to meaningfully boost a skill trade. Labor availabity means: how many people - heavily influenced by the unemployment rate - are interested in putting in the time to go retrain themselves to do a new job. Many people will not kill themselves to do so, if they're making $45/hour and you tell them the upside is $60/hour. A deep level of comfort sets in for a large percentage of the population once you get to $30-$45 per hour. Skill means: it takes years to train someone to an appropriate level at being a professional anything, whether we're talking roofing or plumbing. Time means: well, it simply takes time to rotate large numbers of people into blue collar jobs. The whole process takes a lot of time, from start to finish. There's only so much that can be done to speed that process up. Market awareness: it can take years for people to believe that blue collar work demand is going to be sustained (history say otherwise, and people know that such work is often inconsistent; and they know that the downturns are brutal). It can take years to get the word out in just a mid-size city like San Diego, that there is high demand. It requires new entrants to take risk, which most people do not like doing. To be convinced to take a life change risk if someone is even remotely comfortable, the reward has to be extreme in most cases.
ransom1538 9y ago
>> "Anecdotaly, about 20% of new hires under 30 don’t understand the concept of showing up on time (or at all)" Don't kid yourself. Those new hires are at other jobs making more money. I am booked for a roofer in feb 2018 (fingers crossed - friend of a friend). Blue skills are in extremely high demand. And those guys are working extremely hard making really high incomes (400k+). These guys are highly paid and are not messing around -- most saw 2008. They drive nice trucks, own their company, have rude secretaries and wont look at your email until feb 18 (fingers crossed). Look at a blue collar guys' current circumstance: no competition (know anyone learning HVAC?), a HUGE housing boom in cali, pass through low tax income, 2k homes burned (wtf), no outsourcing (try outsourcing a plumber) -- as my mentor said: "Harvest time".
- jetrink 9y ago
  This reminds me of the observation[1] that most applicants for programming positions can't implement FizzBuzz. This has led some to conclude that the majority of programmers would be stumped by the task, but it is more likely that such programmers are overrepresented in the applicant pool. 1. http://wiki.c2.com/?FizzBuzzTest http://wiki.c2.com/?FizzBuzzTest
  - danielvf 9y ago
    This is exactly the issue. It’s not that all $manufacturing_demographic have issues showing up up, working, or are doing drugs, it’s that the pool has been almost picked clean of those who don’t.
    - s73ver_ 9y ago
      It doesn't help that most employers are not willing to do what it takes to attract qualified employees.
  - expertentipp 9y ago
    So we have filtered 0.5% "elite" passing FizzBuzz, what shall we do now? Those need CV crafted in LaTeX, maintain public repositories, have fluency in latest frameworks and APIs, demand moderate salary... wait... nobody's left. SHORTAGE! Teach EVERYONE programming!
tryingagainbro 9y ago
I guess 3-4% is better than less /nothing, but seriously, this needs to be going on for 20-30 years.
mikeokner 9y ago
Another key factor is that a lot of baby boomers are reaching retirement age. With every kid being told college is the only path to become "successful," there's going to be a lack of talent in the trades at least in the near term that's going to continue driving wages higher.
- megaman22 9y ago
  And the all-too-common problem is that firms haven't prepared for the necessary knowledge transfer when those boomer workers do retire. If you've got a millwright who's been working in the same plant for forty years since it opened, he'll know every detail of how things work, where things don't match the schematics, what's been tried and how well that worked out. You can't just start that process when they turn in their two-weeks' notice; you've got to have somebody or somebodies working as assistants, and you've got to pay them adequately to keep them around. Nobody wants to do that.
  - RhodesianHunter 9y ago
    They'll pay for it all right, just down the road when it's some other executive's problem.
- jseliger 9y ago
  I've been teaching college students at non-elite schools for ten years, and it's obvious to me (and pretty much any intellectually honest person) that college has been oversold; many students floundering in college would be better served by trade schools: http://seliger.com/2017/06/16/rare-good-political-news-boosting-apprenticeships http://seliger.com/2017/06/16/rare-good-political-news-boost... Not everyone should be specializing in abstract symbol manipulation.
sravan222 9y ago
Kiel
jamesmp98 9y ago
I keep hearing how great blue collar josb are, but looking at glassdoor, most of them seem to be in the $30k - $50k range in my state
- PopsiclePete 9y ago
  Heh. $50k isn't too bad, is it? Don't nurses start at that?
  - jamesmp98 9y ago
    I mean, it depends on where you live I guess. Out here, you can probably live well on $50k
- randomdata 9y ago
  If you spend your time around highly-paid software professionals, $30k-$50k may not seem great. When you consider that the median income in the country is $31,099[1], making more than half the population is pretty great. At the upper end of that range, you are in the top 30%. [1] https://en.wikipedia.org/wiki/Personal_income_in_the_United_States https://en.wikipedia.org/wiki/Personal_income_in_the_United_...
fredgrott 9y ago
it's just a repeat...something goes up and everyone jumps not realizing that the boiling water has already started to simmer...I am referring to the general lack of economic growth per country...the longer that goes on..the worse the boiling water will feel at the end..will we be boiled or will we finally understand our grave future economic peril
roseburg 9y ago
It's a labor shortage more than anything else they listed. It's not an energy boom, weak dollar, Trump etc. The question should be "why is this a surprise?" Does our culture esteem people that work with their hands? Do parents encourage their children to aspire to learn trade skills? Does our educational system encourage students to learn trade skills and explore the trades as highly viable alternatives to going to college? We've looked down at the trades and blue-collar work for decades. The evidence is everywhere. Of course there is a shortage, students have been listening to the adults in their lives, their peers, media outside of Mike Rowe etc and have heard the message loud and clear. Solutions; I see two things that need to happen. First, we need to reach and communicate to students and adults across the country that trade skills are valuable and a career in the trades is an outstanding option. Create a more efficient, affordable and accessible resources for people to learn trade skills, no matter their location, age, income, nationality etc. We need to make it 10x easier for people to learn the skills that are in demand. I’m working on both those solutions at Tradeskills.io   Definitely a lot to figure out!
tjpaudio 9y ago
Data Scientist at major company here that was pounding nails in construction circa 2005. This to me is no surprise. At the time I was early 20s and needed that job that would be sort of an apprenticeship. The problem was, these jobs just didn't exist. The young guys (me) got laid of every winter to keep on as many senior crew members as possible and every spring the jobs were less skilled and more labor (think demolition vs. the skills needed for finish work). Young workers need a solid 5-7 years to develop those skills, but from the years 2005 (yea, that early things started slowing down in construction) to 2015 we didn't really train anyone new. My story was a common one; unable to find work in the trades, I eventually gave up and looked for work elsewhere. So there is a gap in the training of skilled labor. How long will it take to recover? Easy, the same 5-10 years we took a break from training new labor.
- myegorov 9y ago
  Your career path (and its determinants) mirror mine to an uncanny degree. Nonetheless, I disagree that there's a long-term shortage of skilled labor in the US in general, or that any short-term shortage has its root cause in underdeveloped supply channels. I saw first hand how easy it was to procure non-union labor, even at the height of construction boom circa 2004 (when I left construction trades) or 2015 (when I left the construction industry as a licensed engineer). Like yourself, I couldn't compete (or refused to put up with) what's essentially become a migrant work force. While it does take about as long to become a skilled carpenter as it takes to become a software developer (and a strikingly similar mindset too), it's infinitely easier to employ migrant skilled workers, the workers are highly mobile, there's a ready supply of them anywhere there's active construction going on, and everyone in the construction business -- from employers to clients -- has de facto acquiesced in the status quo where work permits are not enforced. Union labor is indeed rather inelastic during the periods of boom and bust, but it's also chronically underemployed, historically shrinking and in the big scheme of things a tiny portion of the overall labor.
  - ianai 9y ago
    I agree. The ability to employ people from just about anywhere makes demand very sensitive to any wage increases. Further, the economy doing well when people see wage increases reinforces that marginal increases in income for the 99% highly benefit the national output.
sandworm101 9y ago
I'm unclear from this article whether wages are going up or costs. Wages are take-home earnings of workers. That is something different than costs to employers. I need clarification as to whether insurance/tax costs are part of this math. Ideally, in such articles I want to see actual numbers. I want to see "the average wage for a carpenters in 2015 was X, and today is is X+10%". I'm not so sure that those numbers are changing all that much.
eighthnate 9y ago
I could have sworn this same article was one the front of HN a few days ago...
dsfyu404ed 9y ago
ITT a bunch of white collar software engineers discuss subjects about which most have zero familiarity.
- cylinder 9y ago
  When blue collar wages rise it is due to flawed economic policies! When white collar tech wages rise it is because they are creating an incredible amount of economic value and deserve all of it! It is absolutely all because of their own genius!
tamrix 9y ago
Is anyone else finding a lot of these comments are overly exaggerated? It's like everyone's ego suddenly came out.
- dang 9y ago
  Anything wage-related seems reliably to do that. I suppose it triggers both survival instincts and status issues.
vadimberman 9y ago
But, but, but... automation! Singularity! Boston Dynamics robot backflips!
- Strom 9y ago
  If backflipping robots do the easier work, then what is left for humans is the more complex well paying work. When you remove the lower paying jobs from the average calculation, the average will rise. Indeed the article even states that at 89%, male prime-age [labour market] participation remains close to a record low. The article also has an opinion quote stating that some of the recent wage gains are misleading, because they have occurred in industries, such as textile manufacturing, in which employment continues to fall.
  - vadimberman 9y ago
    That's the point, it will take A LOT longer for the robots to replace these menial jobs. (And they are not all as low-paying.) I remember articles from one or two decades ago about the attempts to automate a very dangerous and not even low-paying job of window washing in the high rise buildings. It is a real problem, it does not require HAL-9000 grade AI that can analyse Shakespeare, it is economically viable, and neither then nor now it is completely automated. I see that in Australia, window washing jobs are paid as high as low to midrange software development. I am not even going to mention more complex tasks like a work of a plumber, a gardener, a janitor. Is the work of a janitor the more lucrative occupation? It takes very long to get from the first demos to a prototype working most of the time, and even longer from the prototype to a system that can be relied upon in a mission critical environment (a category that most applications of robotics fall into). The Silicon Valley prophets got it all backwards.
m0llusk 9y ago
It is interesting that wages spiked and yet hourly rate is being considered the only relevant factor by many. Most of these jobs require behaving in a servile manner toward some assholes who have zero respect or commitment and start the process with a drug test in order to make the fundamental lack of trust explicit. The way corporate America treats candidates and employees is unacceptable at any price for many people.
- gokvokbok 9y ago
  I've heard wages have been stagnating since the 70's or onwards. The latest QE or whataver is just the banks trying to kickstart a corpse they killed. In a horrible way, by funneling huge amounts of made up cash into the Silicon Valley 'ites. And we get Facebook, Twitter and other inane wastes of time. Edit: [1] https://www.youtube.com/watch?v=k6z42a8yfTg https://www.youtube.com/watch?v=k6z42a8yfTg
- linkregister 9y ago
  Have you ever worked a construction or labor job? I don't recall ever having to act in a servile way. Service jobs on the other hand were the most humiliating experiences of my life. We were expected to take harsh abuse from customers while issuing apologies.
anovikov 9y ago
Maybe this is simple fact of exhausting of 'Chinese advantage' of lower wages in developing countries, that used to drive jobs abroad? Even about 2007, there were forecasts that Chinese wages will rise to the level which no longer drives American jobs away - to ~20% of American level, rest is compensated by lower productivity - by about 2015. It was long ago expected to be a turnaround year. So why are everyone surprised?

261 points by artsandsci 9y ago

ocschwar 9y ago

Plumbers can't telecommute.

deleted 9y ago
[deleted]
onion2k 9y ago
I imagine there's an opportunity for a startup that let's someone who wants to do a simple job themselves Facetime with a plumber to talk them through the work. No idea if there's any profit in it though.
- baxtr 9y ago
  Love it! But, in many countries regulation/ warranty might kill such an idea.
- strictnein 9y ago
  I imagine lots of this: "Lefty loosey, righty tighty... no no your other left"
  - antisthenes 9y ago
    "...and now your house is flooding at 3 GPM"
- cma 9y ago
  Microsoft did a marketing demo of that (Skype Hololens): https://bfgblog-a.akamaihd.net/uploads/2015/01/hololens-plumbing-e1422571078912.jpg https://bfgblog-a.akamaihd.net/uploads/2015/01/hololens-plum... (it was faked, the remote guy was drawing with a tablet, but somehow it worked in 3d like tilt brush..)
- bdamm 9y ago
  "Now grab a 3ft section of copper tubing, cut it to length with your pipe cutter, bend it with your copper bending tool, and flare it with your flare clamp... what, you don't have any of those? Wellll.."
  - alextheparrot 9y ago
    Great! There’s an opportunity for same day rental delivery here too
    - toyg 9y ago
      And in the end you'll have spent more than you would have with a regular plumber, you'll have a bunch of tools you won't need for another 10 years, and the job will look terrible. Source: had to retile a bit of a floor, too small to interest a real tiler. Guess how it looks now?
      - jerkstate 9y ago
        I'm not a professional but I cracked a tile on my kitchen counter and replaced it and you can't tell. Likely difference between you and me? My uncle is a tile man and he walked me through the whole process (remotely), from finding a matching replacement tile and grout to what kind of tile glue works best for this kind of tile to grouting and cleaning.
      - monocasa 9y ago
        > And in the end you'll have spent more than you would have with a regular plumber, you'll have a bunch of tools you won't need for another 10 years, and the job will look terrible. That part of the business model worked well for Home Depot.
      - ryandrake 9y ago
        As someone who does as much as I can around the home myself, this attitude baffles me. I consider my tools and knowledge a financial investment: most are used at least monthly, some weekly. I'd never be able to afford living in my home if I paid a contractor to come out every time my toilet leaked. Likewise, my car ownership costs would increase substantially if I paid a mechanic $100 to change the oil or $1000 to service the brakes. Also, most light everyday home maintenance work like laying tile, building a fence, framing a wall, installing plumbing, etc. is not rocket science. You don't have to be Bob Vila or go to trade school for years to learn how to do it.
- westbywest 9y ago
  A substantial factor in licensed tradespersons' ability to collect the wages they get is that many situations require the work be done by a license holder. For example electrical or plumbing repairs done to satisfy a building code violation are often expected to have permit paperwork documenting the repair. License = ability to pull permit.
  - thanatropism 9y ago
    What, can't a tradesman certify that a job was done to code remotely? We allow people to get degrees online. Of course, some things (is the screw really tight?) can't be verified by video only, but possibly one could devise smarter tools like pressure gauges and some such that can be shown over a video call.
    - TheCapn 9y ago
      I'd be curious what the cost savings in the end were regardless. An untrained hand takes so much longer to complete a task that a professional is used to regardless of the understanding. Do you want to slog along a journeyman in video conference for 8 hours or hire him for 2? What's your cost going to be with either? Beyond that a lot of physical tasks can be done blind, does he "see" that you've threaded the hose properly or applied the compound properly when you're doing it by feel as your eyes can't reach behind whatever you're working at? I like the idea but I always relate back to my own real world experiences and think about how inefficient it is to remotely task with someone. Ever try helping your parents navigate their computer over the phone? Imagine doing that with a professional @ $100/hr or whatever to replace your faucet or wire new fixtures and run cabling to a breaker panel
    - westbywest 9y ago
      The licenses tradesmen carry also tend to be paired with some sort of insurance or bond to back up the fitness of their work. Were it my plumber's license and liability coverage, for example, I'd be hesitate to approve a sweated pipe weld just from video footage. And the market for cheap sonar/magnetic gadgetry or whatever for laypersons to inspect the welds on bathroom plumbing probably just isn't there.
- PeterisP 9y ago
  What's the business model there? If the job would take a plumber 30 minutes, it'll take me an hour - so instead of paying a plumber for 30 minutes of work, I'd need to pay him for an hour of supervision; so I'd be paying more for the privilege of doing it myself.
  - alextheparrot 9y ago
    Presumably a single plumber could handle multiple clients, plus you are already paying for his commute, which you probably don’t need to do (in your own house)
    - throwawayjava 9y ago
      I could see some combo of youtube, tool rental, and a live helpline with trained blue collar workers as a fallback.
- bpicolo 9y ago
  You'd have to pay a plumber -more- to wait for you to do it, because you're going to be less efficient
  - onion2k 9y ago
    I was thinking more like having someone assess the job, point out potential tricky bits, advise on different approaches, etc before you start. Like I said, I have no idea if there's a profitable business there, I was just suggesting a way a plumber could actually work remotely.
- ceejayoz 9y ago
  My dad helped me disassemble a lawnmower to fix a carburetor float once via Facetime, and I felt like a living Apple commercial when it started back up on the first pull, especially considering I didn't know what a carburetor was beforehand.
- 52-6F-62 9y ago
  That would be pretty funny, but plumbing can be pretty damned complex work. I could see some potential in apprenticeships taking place remotely, though. At least in the latter years of one. And maybe compliance tests, journeyman tests, etc — depending on the nature of the work. And in that case, less Skype, and more AR.
  - humanrebar 9y ago
    The risk is pretty high, too. Instead of a $300 p-trap replacement, you can do it yourself, but if you do it wrong, you can have 4-5 figures of accidental water damage to the house.
    - 52-6F-62 9y ago
      Absolutely! And that's just in your bathroom wear-and-tear maintenance. Never mind commercial plumbing! Small business owners trying to sort out a commercial block backup caused by a grease-trap failure could start to turn out a few issues... Plumbers deserve higher regard than they're given (all great plumber jokes aside). That said if the tech could be used to improve the training of specialists in remote areas/ areas that might be short a few journeymen or master tradespersons, or aid in especially complex problems, it could be a huge boon and reduction in cost (eg - travel costs).
- matt_wulfeck 9y ago
  DIY always breaks down when you need to purchase an expensive tool that you only use once.
  - abfan1127 9y ago
    I wouldn't say always. I usually ask my friends if they have the tool and borrow it, or buy it knowing someone will likely borrow it in the future.
  - bluGill 9y ago
    Fortunately most of the tools you don't use once. The few you do tend to be the types of tools a pro would rent as well.
  - ceejayoz 9y ago
    Tool libraries are a pretty neat solution to this. Some local book libraries are getting into it as a way to expand services.
  - dcherman 9y ago
    Define expensive. 200$? That's the cost of the plumber's time, and now I've got that tool forever. That and I've gained knowledge and know how to fix or build something that I didn't before which is something I take pride in. In my experience, there's been very few things where it makes more sense long term to just pay someone else to do it so long as you're willing to do a little bit of learning.
- hiram112 9y ago
  I tried to fix numerous issues with my car and in my apartment by following very clear and detailed YouTube videos. Unfortunately, it's the little things that usually push me to give up and hire a pro - wrong tools, don't know the tricks to get a tight screw loose, etc. It's not dissimilar to how many non-technical PHBs watch developers typing away, and figure they can just get a random worker for half-price to copy the same code from a book or website. In reality, it's not the actual code - many times which can just be copied - that makes a good developer worthwhile, it's the years of experience to know what to do when something goes wrong.
- myth_drannon 9y ago
  I'm not allowed to cut a tree in my backyard because it's close to power lines, only licensed arborist. I CAN do it but not allowed, so it's just a legislation not an issue of knowledge.
  - m0llusk 9y ago
    Trimming trees near power lines is extremely dangerous and can lead to deadly electric shocks even simply operating near power lines. Metal ladders and tools can draw current from lines to ground and to a great deal of damage. Arborists have special training and tools to prevent deadly electric shocks when trimming trees near power lines.
- jaymzcampbell 9y ago
  I worked at a startup doing exactly this last year[1], [2], [3]. Unfortunately, the parent company shut us down after we ran out of runway but it was starting to gain traction. One issue we had was ultimately a lot of people wanted someone to come out anyway and to make sure we had the right quality (and so gain customer/brand trust) we had to do this in-house - i.e. hire actual plumbers and handymen to be on call as well as building logistics software to support all of this entirely outside of the video call aspect. It was more than a bit depressing the parent company pulled the plug because it really did feel like it was about take off. Maybe we could've instead integrated into a set of preferred suppliers cross country as a lead gen service. Though if you read the TrustPilot reviews it was the fact we were the whole package that customers loved. We started by first charging for calls but in order to grow switched that to free calls with the assumption that people would then book a home visit if needs be. Nobody wanted to pay £10 on a call and find out they needed a plumber to come out. It felt like something that with Uber-style levels of investment (i.e. tons) could be pretty profitable if you owned the sector. To expand on our offerings we would do things like allow people to simply book a handyman for an hour to do whatever - put up a curtain rail, fix that loose light fitting and so on. People were using the video aspect as a precursor to someone actually coming to do the work so the video bit was never the end of the transaction. As soon as you start needing a team of people to field customer calls, do support and manage your countrywide team of tradesmen it gets expensive. [1] https://uk.trustpilot.com/review/dad.co?page=2 https://uk.trustpilot.com/review/dad.co?page=2 [2] http://www.eu-startups.com/2016/05/london-based-dad-secures-2-million-to-launch-diy-video-visit-service/ http://www.eu-startups.com/2016/05/london-based-dad-secures-... [3] https://s3.amazonaws.com/poly-screenshots.angel.co/enhanced_screenshots/423633-original.png https://s3.amazonaws.com/poly-screenshots.angel.co/enhanced_...
  - GFischer 9y ago
    Well, having someone over video sounds like it would have value :) (even though eventually you get a house visit), I'd love that service. I have some exterior window blinds that need fixing, I'd love for someone to see it over a video call and get a quote before them coming. That startup sounded great, I'm sad it failed :(

margorczynski 9y ago

Does every paragraph needs to rephrase that it isn't thanks to Trump? Maybe I'm wrong but lately it seems every US media outlet needs to mention him this way or another in every topic possible (positive or negative light)

warriormonk5 9y ago
The Economist is a British publication
rm999 9y ago
I think you may be underestimating the importance of this article to US politics. One of the biggest issues in the 2016 election was stagnating blue-collar wages - it was one of Trump's main platforms, and one of the main factors that made him President. If the economy continues to do well across all income levels, regardless of why, and regardless of how unpopular Trump remains, there is a good chance we will see a second Trump term. As much as I dislike him, Scott Adams made this exact argument recently: http://blog.dilbert.com/2017/10/14/low-public-approval-of-president-trump-yet-unusually-high-consumer-confidence-hmmm/ http://blog.dilbert.com/2017/10/14/low-public-approval-of-pr... As Bill Clinton said, "it's the economy, stupid".
- thanatropism 9y ago
  Did you begin disliking Scott Adams when he became a Trump booster, or...?
  - victor106 9y ago
    No. When he let it out that 1. He supports the NRA even after the recent gun violence 2. When he supported Trumps statements during Charlottesville 3. When he keeps saying on Twitter how the alt-right is so correct.
  - ffhhfyy55 9y ago
    He’s long been a minor celebrity with delusions of grandeur. His blog stuff comes off as no better informed than a typical cable news watcher But he makes comic strips that show how everyone else is the idiot so there’s that So of course he’ll fit right in with the tech crowd

danielvf 9y ago

I worked with small / medium manufacturers in the prosperous part of the Southeast. Hiring is brutal currently. Last week one company setup interviews with 20 possible new workers. One showed up for his interview, and one wandered in the next day. 18 nonshows. Another local company is seeing 50% of new hires failing their first drug test. Anecdotaly, about 20% of new hires under 30 don’t understand the concept of showing up on time (or at all) even after that’s explained as a part of orientation. Sub $160,000 houses (3-4 bedrooms, land, average schools, 15-30 minute commute) are now selling in 1-3 days, compared with 3-6 months five years ago. There’s definitely a boom getting started here.

deleted 9y ago
[deleted]
QAPereo 9y ago
This is what over 40 years of gutting education and social safety nets bought us. Idiocracy is coming!
- TheAdamAndChe 9y ago
  No, this is what happens when employers show their workers absolutely no loyalty over decades. If people have no reason to care about their job, they won't care about it. The labor market is tight enough so that they can't just fire everyone who behaves like that, otherwise everyone would quit.
  - QAPereo 9y ago
    That’s a factor, but the collective dumbing down is as well. We now have a nearly feral workforce and body politic, because contrary to expectations, they’re unpredictable and hard to control.
    - TheAdamAndChe 9y ago
      > the collective dumbing down is as well Graduation rates are are higher than ever. Over 30% of people have Bachelors degrees or higher. Literacy rates are higher than they ever have been. Our people aren't dumber, they just realize that when the business managers and owners are making millions while they don't get wage increases above inflation, they have no incentive to care.

PatientTrades 9y ago

Illegal border crossings on the southern border are down 78% and blue collar wages are rising. Of course correlation does not equal causation, but when there are fewer available workers to hire/train and demand remains constant, wages tend to rise.

amriksohata 9y ago

The gap is closing but it means amenities are getting more expensive and since the people in the middle aren't getting raises it just isn't attractive to work in a smarter role

TheAdamAndChe 9y ago
Right, and as fewer people go into middle class jobs, demand for those workers will increase and will lead to increased wages. This is what inflation is. It's all a function of supply and demand.
- thrillgore 9y ago
  It'll be either an increase in wages, or increase in visas for that kind of labor from overseas.
  - amriksohata 9y ago
    Or worse the businesses decide to open shop abroad the jobs disappear from the local market
    - TheAdamAndChe 9y ago
      Hence the growing disdain for globalization. It's a race to the bottom to see what country will provide the lowest wages and quality of life for its workers.
      - amriksohata 9y ago
        Interesting way of looking at it, and capitalism in general

xefer 9y ago

Since this article focuses on the U.S., how much of this is related to the slowdown in illegal immigration?

danielvf 9y ago
Probably none [edit: in manufacturing]. Most illegal immigrants don’t work manufacturing. The three most common jobs for illegals around here are construction, yardcare, and building cleaning via nested subcontractors. Manufactures have hard assets they could loose. Sketchy subcontractors can just disappear and rename. The growth is from the demand side - people are buying more right now.
- gthtjtkt 9y ago
  > Probably none. Most illegal immigrants don’t work manufacturing. You say that as if the jobs taken by illegals exist in some alternate universe where simple economic principles don't apply. If an illegal immigrant's job is vacant (because he couldn't enter the country) and a would-be manufacturing worker fills that job, that obviously has a direct impact on the manufacturer's ability to hire that worker. He's no longer looking for a job because he filled a vacancy left by an illegal immigrant.
  - Xylakant 9y ago
    This makes little sense. Illegal immigrants usually occupy the least qualified and least-paid jobs. Few persons that are qualified to apply for a manufacturing would rather apply for a job that an illegal immigrant could get.
    - gthtjtkt 9y ago
      Do the illegal immigrants take those jobs because they pay so little, or do those jobs pay so little because there has always been a steady supply of illegal immigrants desperate to fill them at below-market prices? If your business model relies on wages being suppressed by those illegal workers, then maybe your business deserves to go bankrupt when the supply dries up and Americans start demanding $15/hour.

dionidium 9y ago

I work at a medium-sized software company. We've had similar problems with younger employees. Guys literally posting in company-wide Slack channels that they're "feeling a little sleepy this morning, gonna be in later." Can you even imagine somebody saying that to their boss in some black-and-white movie from the 1940s? "Hey, how about instead of coming in later you hit the bricks and never come back?" The culture has definitely changed. It's wild.

nesyt 9y ago
Are you against this? Flexible working hours that can bend to accommodate very malleable human lives seems better than rigid adherence to traditional schedules for the sake of it.
- alexanderstears 9y ago
  It's important that businesses answer the question and stick to it. Do they want people to work a set schedule or not? Or businesses can make demands, but in this labor market they'll have to pay for people to meet 'em. I can promise to be in my chair at 9 am everyday, but I want to leave at 5 and if I'm tired, the business gets to pay for a less than productive day.
  - humanrebar 9y ago
    If they want me commuting during both morning and evening rush hour, they better pay a premium over companies that let me work around commuting. The extra 30+ minutes per day stuck in traffic or on trains does not come for free.
    - deleted 9y ago
      [deleted]
- Y7ZCQtNo39 9y ago
  Yeah, if a person really feels the need to sleep in, I can't imagine their productivity would be much different if you had a culture for pressuring for adhering to schedules. I think many people to fail to realize that writing software is very unlike producing widgets in a factory line. Some people hit periods of high productivity when they work quietly, alone, for an hour or two. And you might get more in that 1-2 hours than you would all day with the constant distractions in the modern office.

thanatropism 9y ago

This comment (not by me; the poster name isn't even visible anymore): > Illegal border crossings on the southern border are down 78% and blue collar wages are rising. Of course correlation does not equal causation, but when there are fewer available workers to hire/train and demand remains constant, wages tend to rise. was marked dead. Why? Is the illegal crossing number wrong/fake news?

ben_jones 9y ago
Whatever the crossing number is I don't believe it. There is too much incentive for the number to be artificially higher or lower. Politicians in border states want it low. Border patrol want it low. Feds want to show marked "improvement".
stemc43 9y ago
illegals dont have SSNs. EMployers have to run ssn verification before they hire you. These checks are instant and this will popup immediately. Can they still hire you - well maybe for janitorial -> manufacturing jobs I'd say highly unlikely.
- smallnamespace 9y ago
  This is definitely not the case. E-Verify has existed for a long time, but is still not mandatory [1]. Employers are supposed to have employees fill out an I-9 form that verifies employment eligibility, but the penalties for noncompliance are at most $1,100 per form -- basically slap on the wrist territory [2]. The irony here is that the anti-immigration wing of the Republican party is now in open conflict with the business wing of the party, which benefits heavily from hiring ineligible workers for low wages. [1] https://en.wikipedia.org/wiki/E-Verify#Operations https://en.wikipedia.org/wiki/E-Verify#Operations [2] https://www.thebalance.com/i-9-form-employment-eligibility-verification-form-1918902 https://www.thebalance.com/i-9-form-employment-eligibility-v...
  - ryanmarsh 9y ago
    I've never used E-verify. I just use people's I-9. Everyone I've ever hired was born in the US so I never thought about this.

seibelj 9y ago

I keep reading that AI is going to eliminate all the jobs. Yet unemployment is at record lows and wages are rising across the board. Could it be possible that AI will instead free people to work on new jobs in new industries? Amazing! It’s almost like this time is not any different from any other time.

ffhhfyy55 9y ago
Yeah all those retail and manufacturing workers can jump right into coding and medicine no problem when robots take over It’s just that easy!
bpicolo 9y ago
There are other factors though, e.g. underemployment.
bantunes 9y ago
It's the first time we're automating legal casework and medical diagnostic work. Rest assured: it is different.
ceejayoz 9y ago
The last massive shift like this led to multiple world wars. Let's not pretend there aren't legitimate concerns about the impact of AI on society - unemployment numbers are only one part of the story.
throwawayjava 9y ago
There was a long lag between the time when companies invested in hardware and the time when worker productivity started really picking up. And a lot of the job reduction didn't happen in firings, it happened in not replacing retirements. Unemployment lags behind productivity increases. Productivity increases lag behind tech adoption. Tech adoption lags behind innovation. innovation lags behind technology maturation. technology maturation lags behind science. A lot of the transformation automation is in the "science/maturation" or the "innovation" phases.
Density 9y ago
Overwhelming number of jobs created in the last decade are very low quality gig economy jobs. People work, but they're severely underemployed.

neves 9y ago

The article says no, but are there any dissented view that sees a causation between Trump policies and the rise in blue collar wages? Please, polite answers only. I'm just a foreigner that want to understand a little more.

SamReidHughes 9y ago
One way that Trump helped is that the illegal migration rate dropped as soon as he came into office. He scared people out of even trying. You've also got his halt to the ever-expanding regulatory environment and his opposition to the TPP.
- eru 9y ago
  Did they actually drop? From what I remember, illegal migration has been dropping for years now.
sailfast 9y ago
Not a "dissenter" per se, just a rational human trying to draw connections: In service positions, I could see a rise in wages attributed to those jobs that might have previously been filled with migrants. I might see legal immigration also being discouraged, but to be honest that includes tourism from abroad which is shrinking and potentially having a negative impact on the service sector. The only direct _policy_ link I can see is not a policy but rather a "business friendly" climate that might lead companies to start to invest more, understanding that they probably won't be taxed or regulated more heavily in the next 3 years. That, plus cheap credit (a big overheat risk IMO) means opportunities for growth. In terms of actual policy, I'd say not much has happened but rather the economy is now recovering from the housing crisis and growth has picked up again across the board. This was occurring before Trump, and will continue until another systemic issue occurs and people panic I'd imagine. That said, in my opinion, Presidents rarely have much to do with economic outcomes except to either inject risk / instability with policy initiatives or pronouncements. Some big policies have costs, but most of the day to day impacts are quite spread out. There has been no action yet on health care or taxes that would influence employer direct costs. Perhaps some regulation has not been implemented and some executive orders rolled back, but nothing that would impact markets.

pure_ambition 9y ago

No it won't last, because as soon as the wages start coming up then the fed will say "inflation is heating up" and raise interest rates, causing businesses to spend more on debt service and less on employees.

smallnamespace 9y ago
Higher rates only affects new issuances of bonds, rolling over of existing debt, or bank loans (which are a small fraction of the total debt market in developed economies). The average maturity of a corporate bond is now 15+ years, and most bonds pay a fixed interest rate that doesn't vary due to current rates [1]. That means that any change to rates will not have much of an immediate impact on the interest expense line item. On the other hand, it will actually increase the interest income they receive on their cash balances. [1] https://www.ft.com/content/41213b02-b87e-11e6-ba85-95d1533d9a62 https://www.ft.com/content/41213b02-b87e-11e6-ba85-95d1533d9...
- soVeryTired 9y ago
  You think rolling over of debt and new issuance is less important than interest income?
  - smallnamespace 9y ago
    No, but the 15+ year plus maturity of existing debt stock means that on average, borrowers won't need to go back to the capital markets any time soon. Slightly oversimplified way to think about it: every year companies need to refi only 1/T of their debt, where T is the average maturity.
- Symmetry 9y ago
  Not to necessarily agree with the OP's prognosis, but the Fed rate also affects inflation which can affect the viability of every contract written in terms of dollars when it strays from where it's expected to be.
runeks 9y ago

hyperion2010 9y ago

I had a long talk with a guy getting his general contractor's license yesterday. He told me that down in San Diego they are continually short on construction workers, so much that one of his friends said that there is 10 years worth of construction that needs to be done and no one to do it. Wages at ~$45/hr, and probably rising, some projects paying perdiems for commutes from Orange County. Strange.

gjem97 9y ago
I always find it a bit strange when people talk about shortages of non-price-controlled goods and services. When you say that the industry is "short on construction workers", there's an implicit "who will work for what we used to pay them." It seems to me like it's someone who hires in that industry trying to entice more talent to come help lower the price again, rather than an accurate description of the state of the world. To be sure, bona-fide shortages can occur transiently. For example when a natural disaster happens, it will take time for the local tradesmen to work through the backlog. But at a relatively steady state, it seems silly to talk about a shortage of construction workers. Pay a bit more than the next guy, and my guess is, your shortage will quickly disappear.
- sharemywin 9y ago
  You can't just raise prices and expect to win jobs.
- adventured 9y ago
  You can't just create 100,000 new construction workers in San Diego because you raise wages from $45 to $60 per hour. Labor availability + skill + time + market awareness = it takes a helluva lot longer than months or 2-3 years to meaningfully boost a skill trade. Labor availabity means: how many people - heavily influenced by the unemployment rate - are interested in putting in the time to go retrain themselves to do a new job. Many people will not kill themselves to do so, if they're making $45/hour and you tell them the upside is $60/hour. A deep level of comfort sets in for a large percentage of the population once you get to $30-$45 per hour. Skill means: it takes years to train someone to an appropriate level at being a professional anything, whether we're talking roofing or plumbing. Time means: well, it simply takes time to rotate large numbers of people into blue collar jobs. The whole process takes a lot of time, from start to finish. There's only so much that can be done to speed that process up. Market awareness: it can take years for people to believe that blue collar work demand is going to be sustained (history say otherwise, and people know that such work is often inconsistent; and they know that the downturns are brutal). It can take years to get the word out in just a mid-size city like San Diego, that there is high demand. It requires new entrants to take risk, which most people do not like doing. To be convinced to take a life change risk if someone is even remotely comfortable, the reward has to be extreme in most cases.

ransom1538 9y ago

>> "Anecdotaly, about 20% of new hires under 30 don’t understand the concept of showing up on time (or at all)" Don't kid yourself. Those new hires are at other jobs making more money. I am booked for a roofer in feb 2018 (fingers crossed - friend of a friend). Blue skills are in extremely high demand. And those guys are working extremely hard making really high incomes (400k+). These guys are highly paid and are not messing around -- most saw 2008. They drive nice trucks, own their company, have rude secretaries and wont look at your email until feb 18 (fingers crossed). Look at a blue collar guys' current circumstance: no competition (know anyone learning HVAC?), a HUGE housing boom in cali, pass through low tax income, 2k homes burned (wtf), no outsourcing (try outsourcing a plumber) -- as my mentor said: "Harvest time".

jetrink 9y ago
This reminds me of the observation[1] that most applicants for programming positions can't implement FizzBuzz. This has led some to conclude that the majority of programmers would be stumped by the task, but it is more likely that such programmers are overrepresented in the applicant pool. 1. http://wiki.c2.com/?FizzBuzzTest http://wiki.c2.com/?FizzBuzzTest
- danielvf 9y ago
  This is exactly the issue. It’s not that all $manufacturing_demographic have issues showing up up, working, or are doing drugs, it’s that the pool has been almost picked clean of those who don’t.
  - s73ver_ 9y ago
    It doesn't help that most employers are not willing to do what it takes to attract qualified employees.
- expertentipp 9y ago
  So we have filtered 0.5% "elite" passing FizzBuzz, what shall we do now? Those need CV crafted in LaTeX, maintain public repositories, have fluency in latest frameworks and APIs, demand moderate salary... wait... nobody's left. SHORTAGE! Teach EVERYONE programming!

tryingagainbro 9y ago

I guess 3-4% is better than less /nothing, but seriously, this needs to be going on for 20-30 years.

mikeokner 9y ago

Another key factor is that a lot of baby boomers are reaching retirement age. With every kid being told college is the only path to become "successful," there's going to be a lack of talent in the trades at least in the near term that's going to continue driving wages higher.

megaman22 9y ago
And the all-too-common problem is that firms haven't prepared for the necessary knowledge transfer when those boomer workers do retire. If you've got a millwright who's been working in the same plant for forty years since it opened, he'll know every detail of how things work, where things don't match the schematics, what's been tried and how well that worked out. You can't just start that process when they turn in their two-weeks' notice; you've got to have somebody or somebodies working as assistants, and you've got to pay them adequately to keep them around. Nobody wants to do that.
- RhodesianHunter 9y ago
  They'll pay for it all right, just down the road when it's some other executive's problem.
jseliger 9y ago
I've been teaching college students at non-elite schools for ten years, and it's obvious to me (and pretty much any intellectually honest person) that college has been oversold; many students floundering in college would be better served by trade schools: http://seliger.com/2017/06/16/rare-good-political-news-boosting-apprenticeships http://seliger.com/2017/06/16/rare-good-political-news-boost... Not everyone should be specializing in abstract symbol manipulation.

sravan222 9y ago

Kiel

jamesmp98 9y ago

I keep hearing how great blue collar josb are, but looking at glassdoor, most of them seem to be in the $30k - $50k range in my state

PopsiclePete 9y ago
Heh. $50k isn't too bad, is it? Don't nurses start at that?
- jamesmp98 9y ago
  I mean, it depends on where you live I guess. Out here, you can probably live well on $50k
randomdata 9y ago
If you spend your time around highly-paid software professionals, $30k-$50k may not seem great. When you consider that the median income in the country is $31,099[1], making more than half the population is pretty great. At the upper end of that range, you are in the top 30%. [1] https://en.wikipedia.org/wiki/Personal_income_in_the_United_States https://en.wikipedia.org/wiki/Personal_income_in_the_United_...

fredgrott 9y ago

it's just a repeat...something goes up and everyone jumps not realizing that the boiling water has already started to simmer...I am referring to the general lack of economic growth per country...the longer that goes on..the worse the boiling water will feel at the end..will we be boiled or will we finally understand our grave future economic peril

roseburg 9y ago

It's a labor shortage more than anything else they listed. It's not an energy boom, weak dollar, Trump etc. The question should be "why is this a surprise?" Does our culture esteem people that work with their hands? Do parents encourage their children to aspire to learn trade skills? Does our educational system encourage students to learn trade skills and explore the trades as highly viable alternatives to going to college? We've looked down at the trades and blue-collar work for decades. The evidence is everywhere. Of course there is a shortage, students have been listening to the adults in their lives, their peers, media outside of Mike Rowe etc and have heard the message loud and clear. Solutions; I see two things that need to happen. First, we need to reach and communicate to students and adults across the country that trade skills are valuable and a career in the trades is an outstanding option. Create a more efficient, affordable and accessible resources for people to learn trade skills, no matter their location, age, income, nationality etc. We need to make it 10x easier for people to learn the skills that are in demand. I’m working on both those solutions at Tradeskills.io   Definitely a lot to figure out!

tjpaudio 9y ago

Data Scientist at major company here that was pounding nails in construction circa 2005. This to me is no surprise. At the time I was early 20s and needed that job that would be sort of an apprenticeship. The problem was, these jobs just didn't exist. The young guys (me) got laid of every winter to keep on as many senior crew members as possible and every spring the jobs were less skilled and more labor (think demolition vs. the skills needed for finish work). Young workers need a solid 5-7 years to develop those skills, but from the years 2005 (yea, that early things started slowing down in construction) to 2015 we didn't really train anyone new. My story was a common one; unable to find work in the trades, I eventually gave up and looked for work elsewhere. So there is a gap in the training of skilled labor. How long will it take to recover? Easy, the same 5-10 years we took a break from training new labor.

myegorov 9y ago
Your career path (and its determinants) mirror mine to an uncanny degree. Nonetheless, I disagree that there's a long-term shortage of skilled labor in the US in general, or that any short-term shortage has its root cause in underdeveloped supply channels. I saw first hand how easy it was to procure non-union labor, even at the height of construction boom circa 2004 (when I left construction trades) or 2015 (when I left the construction industry as a licensed engineer). Like yourself, I couldn't compete (or refused to put up with) what's essentially become a migrant work force. While it does take about as long to become a skilled carpenter as it takes to become a software developer (and a strikingly similar mindset too), it's infinitely easier to employ migrant skilled workers, the workers are highly mobile, there's a ready supply of them anywhere there's active construction going on, and everyone in the construction business -- from employers to clients -- has de facto acquiesced in the status quo where work permits are not enforced. Union labor is indeed rather inelastic during the periods of boom and bust, but it's also chronically underemployed, historically shrinking and in the big scheme of things a tiny portion of the overall labor.
- ianai 9y ago
  I agree. The ability to employ people from just about anywhere makes demand very sensitive to any wage increases. Further, the economy doing well when people see wage increases reinforces that marginal increases in income for the 99% highly benefit the national output.

sandworm101 9y ago

I'm unclear from this article whether wages are going up or costs. Wages are take-home earnings of workers. That is something different than costs to employers. I need clarification as to whether insurance/tax costs are part of this math. Ideally, in such articles I want to see actual numbers. I want to see "the average wage for a carpenters in 2015 was X, and today is is X+10%". I'm not so sure that those numbers are changing all that much.

eighthnate 9y ago

I could have sworn this same article was one the front of HN a few days ago...

dsfyu404ed 9y ago

ITT a bunch of white collar software engineers discuss subjects about which most have zero familiarity.

cylinder 9y ago
When blue collar wages rise it is due to flawed economic policies! When white collar tech wages rise it is because they are creating an incredible amount of economic value and deserve all of it! It is absolutely all because of their own genius!

tamrix 9y ago

Is anyone else finding a lot of these comments are overly exaggerated? It's like everyone's ego suddenly came out.

dang 9y ago
Anything wage-related seems reliably to do that. I suppose it triggers both survival instincts and status issues.

vadimberman 9y ago

But, but, but... automation! Singularity! Boston Dynamics robot backflips!

Strom 9y ago
If backflipping robots do the easier work, then what is left for humans is the more complex well paying work. When you remove the lower paying jobs from the average calculation, the average will rise. Indeed the article even states that at 89%, male prime-age [labour market] participation remains close to a record low. The article also has an opinion quote stating that some of the recent wage gains are misleading, because they have occurred in industries, such as textile manufacturing, in which employment continues to fall.
- vadimberman 9y ago
  That's the point, it will take A LOT longer for the robots to replace these menial jobs. (And they are not all as low-paying.) I remember articles from one or two decades ago about the attempts to automate a very dangerous and not even low-paying job of window washing in the high rise buildings. It is a real problem, it does not require HAL-9000 grade AI that can analyse Shakespeare, it is economically viable, and neither then nor now it is completely automated. I see that in Australia, window washing jobs are paid as high as low to midrange software development. I am not even going to mention more complex tasks like a work of a plumber, a gardener, a janitor. Is the work of a janitor the more lucrative occupation? It takes very long to get from the first demos to a prototype working most of the time, and even longer from the prototype to a system that can be relied upon in a mission critical environment (a category that most applications of robotics fall into). The Silicon Valley prophets got it all backwards.

m0llusk 9y ago

It is interesting that wages spiked and yet hourly rate is being considered the only relevant factor by many. Most of these jobs require behaving in a servile manner toward some assholes who have zero respect or commitment and start the process with a drug test in order to make the fundamental lack of trust explicit. The way corporate America treats candidates and employees is unacceptable at any price for many people.

gokvokbok 9y ago
I've heard wages have been stagnating since the 70's or onwards. The latest QE or whataver is just the banks trying to kickstart a corpse they killed. In a horrible way, by funneling huge amounts of made up cash into the Silicon Valley 'ites. And we get Facebook, Twitter and other inane wastes of time. Edit: [1] https://www.youtube.com/watch?v=k6z42a8yfTg https://www.youtube.com/watch?v=k6z42a8yfTg
linkregister 9y ago
Have you ever worked a construction or labor job? I don't recall ever having to act in a servile way. Service jobs on the other hand were the most humiliating experiences of my life. We were expected to take harsh abuse from customers while issuing apologies.

anovikov 9y ago

Maybe this is simple fact of exhausting of 'Chinese advantage' of lower wages in developing countries, that used to drive jobs abroad? Even about 2007, there were forecasts that Chinese wages will rise to the level which no longer drives American jobs away - to ~20% of American level, rest is compensated by lower productivity - by about 2015. It was long ago expected to be a turnaround year. So why are everyone surprised?