It’s quite refreshing to find out that now even the Wall Street Journal is supporting the very statement I have made for years. There is not now, nor was there ever a skills gap.
I love this quote from the article:
I had an employer write to me the other day saying they had a skills gap, and they really did. It wasn’t wages, because they did market wage surveys, and they were paying what everybody else was paying, and all the employers, by the way, are having a skills gap, so it’s a big problem. Well, if everybody’s got the same problem, and you’re all paying the same wage, it’s probably the case that you’re not paying enough. So the way markets work isn’t you set the wage and say, “Well, this is good enough.” You pay what it takes to get the people you need, and if wages have to go up, then so be it, right? You wouldn’t say, for example, that there’s a shortage of diamonds. Diamonds are very expensive. They cost a lot, but you can buy all the diamonds you want as long as you’re willing to pay.
This is almost the same example I gave a recruiter many years ago.
Recruiter: “We are paying market rate, $40/hr on-site in NJ.”
Me: “That’s not market rate.”
Recruiter: “It’s all the employer is willing to pay.”
Me: “I am only willing to pay 50 cents per gallon for gasoline, go get me all I want.”
Recruiter: “I can’t”
Me: “Why not?”
Recruiter: “It’s over $3 at the pump!”
Me: “Then why are you shopping around $40/hr when it costs around $90/hr just to live in that part of NJ?”
Recruiter: “That’s all we have for a billing rate?”
Me: “And you feel that justifies your wasting everybody’s time?”