So says Neel Kashkari, president and chief executive of the Federal Reserve Bank of Minneapolis. Specifically Business North reports he said in a recent speech:
“Almost everywhere I go, businesses tell me they can’t find workers. I always ask them the same question: ‘Are you raising wages?’ Usually, the answer is ‘no.’ When you want more of something but won’t pay for it, that’s called ‘whining,’” he told the ninth Regional Economic Indicators Forum (REIF), founded and co-sponsored by National Bank of Commerce. “Until you’re paying more, I know you’re not serious.”
Exactly! As we explored previously we all learned in our introductory economics class the way markets balance supply and demand is through price. Price goes up when there is more supply than demand, which draws more supply which eliminates the imbalance. You don’t need government.
Kashkari went on to urge employers to spend more on training, hire more ex offenders, do less drug testing and recruit more immigrants. He is arguing that employers are the answer to the problem they are these days complaining about the most. Business North continues:
Education is “enormously important,” Kashkari said, but so is on-the-job training. “Hey – if you need to train them yourself, then you need to train them yourself.” He also advised reducing some other requirements. “You know what? Maybe for this job we don’t have to do a drug test. Maybe for this job, we can look at people who have made mistakes and had a criminal record before,” he said.
… “The idea that we bring students here to get a great education here, then send them home, is insanity. That’s crazy. Second, if businesses really are short of workers, and here is a skilled worker and the business has the ability to sponsor them for immigration (but doesn’t) … then they’re not serious about workforce shortages. It’s really easy for businesses to say ‘I want skilled workers, and I want them cheap.’ If you want skilled workers, then you must be willing to pay for them – and if that means sponsoring someone to go through immigration, so be it. If that means paying enough to get them, so be it,” he said.
Seems like employers have developed a sense of entitlement. Government should provide them with the employees they need when they need them and with the skills that are needed. And, of course, that should be done with them paying little or no taxes. As we saw in my last post wages have been stagnate for almost forty years. And for those without a four-year degree––where employers claim they are having the hardest time attracting enough workers––they have been declining. This is not how markets work. The solution to the so-called skills shortage rests primarily with employers, not government. As Kashkari says its time for employers to stop whining and compete for the talent they need.