What’s Really Behind Unemployment

I’m going to try to make a little sense out of the unemployment statistics from my vantage point in the American economy.

The stats show 9.2% unemployment, yet in my economic world most people are in hiring mode. Some people I talk to are looking for specific skills, like knowledge about CNC operation or screw machine set up, but even more are looking for people with a good work ethic and a willingness to learn and work hard. A few years ago it was all about recruiting skills, finding a disaffected person or enticing somebody with a fat package. Today it’s about teaching.

I was in a plant yesterday with a sign on the front lawn that said they were looking for machining trainees. They are getting a steady trickle of interested callers, mostly Hispanics and Eastern Europeans. They want to train them “their way.” The company is extremely busy, but reluctant to add more space in a high-priced neighborhood. They are squeezing in two more new Swiss CNCs in a week and want to beef up a second or even third shift. “We need to man up” the plant manager told me. And they want to do it with young people who they nurture.

I hear similar stories in manufacturing from around the country. People are generally not chasing high-priced talent. They prefer developing through the farm system.

I am seeing an enormous disconnect from the unemployed young and old who want to quickly become the “vice president of something.” Companies generally aren’t hiring managers. They want “producers,” or people they can quickly train into producers.

My theory about unemployment today is that we have millions of unfilled job openings and millions of people who want to be vice presidents, which is a bad fit. We also have a lousy construction industry with a million people who define themselves as being a member of the “building trades.” Another bad fit with no building.

Add to that the people who refuse to work for less than they think they are worth. Unfortunately the market is telling them that, at least today, they are not worth what they think they are worth. So they miss the jobs that have good upside, but do not fulfill their economic or status expectations.

Then there are the men in their 40’s and 50’s who have been out of work for months and years. They are angry and depressed and losing hope of ever working again. Unfortunately there are very few ads for sullen guys who expect 60K a year to assemble cars in Detroit (with a defined benefit package), or become sales managers.

The yahoos who write for the national newspapers still do not seem to get this as they blather on about unemployment. There are lots of jobs waiting to be filled, but they are not the vice president jobs so many think they want and deserve.

Meanwhile, the long-term unemployment benefits make it less onerous to be out of work, as the fruitless search goes on for the jobs that do not exist.

A small example — the technical work on this blog and Web site is being done by our excellent associate, Vincent, in the Philippines. One less computer tech job in Chicago.

When will people wake up and grab the opportunities to learn something new in an industry where there’s a need, like machining?

Question: Do you know people who are out of work but would not consider a factory job? Why?

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17 thoughts on “What’s Really Behind Unemployment

  1. Dwayne Richardson

    Machine shops need to offer the working environment found in the successful Swiss, German, and Japanese manufacturing sights. They need to be clean and organized, something that an employee would be proud to “show off” to family and friends. The work environment must have comradery and growth potential creating a sense of pride. Once a parent is proud to have their children work at the same business, there will be success.

  2. Jerry Johnson

    How about 99 weeks of FREE OBAMA CASH ? Why work ?

    Plays right into the Obama / Soros plan of having EVERONE dependent on the Government for EVERYTHING. It’s all about Power and Control.

  3. Dan Place

    Owning a tool/machining shop I agree to all said. I look for raw talent and mix with experiance it works well.
    I take exception to Mr. Richardson’s comment, I run a clean shop as do most of my competitors, I’d go head to head with any, anywhere.(apparently he dosen’t see many or your magazine articals) My biggest problem in keeping my shop clean is Parents who don’t teach there kids to cleanup after themselves, of course that also goes hand in hand with the work ethic the middle class is teaching their kids. Of which I am supposing Mr. Richardson is one of..

  4. Jeff

    I was in manufacturing for 13 years and at the age of 33 I looked around and realized I was the youngest person in the shop of 160 poeple. I left manufacturing for 3 reasons.

    1. During tought times the company did the typical labor cut, circle the wagons, and wait for things to get better. No effort to move forward and try something new, the baby boomer owner was content to make his $$$ at the expense of others loosing their jobs and putting the fear of more job loss into others.

    2. There was no effort to promote from within, mentor individuals, of even consider the what the people in the blue shirts had to offer idea wise. When thngs whent bad engineering blame the blue shirts, blue shirts blamed the engineers, sales people blame both, and whoever was making the most $$$ typically won the argument. When things went well sales people went golfing, engineers surfed the web, blue shirts get pressed harder to be more productive.

    3. No raise for 3 years despite over preforming and working myself though 3 positions. Heck I even asked for more responsibility. One problem……no college debt….I mean no college degree. I was told if I was promoted into the front office everyone else who did a good job on the floor would want to have an office too. I asked where am I supposed to go? How am I supposed to be motivated when I am so hungry and you still want to keep the little carrot dangling in front of my nose?

    Any baby boomers running manufacturing companies need to understand it’s a diffrent time and you need to be much more open minded. All the corporate garbage and title cancer your generation let into business has warped minds away from preformance and into a world of selfishness. The younger generation that wants the VP title without the work are the kids of the baby boomers, where do you think they learned this from?

    This all from someone who is 37, old enough to remember Leave It To Beaver and young enough to know what Jersy Shore is. I would prefer the values of Leave It To Beaver anyday.

  5. Marc Klecka

    The problem is not unique to American manufacturing. The following was posted today on “www.linkedin.com” in response to a swiss machining forum skill-related discussion:

    Yep it’s great (swiss machining activity) and the “trouble” (finding people wanting to work in manufacturing) is worldwide. Here in Switzerland we miss people able to run Swiss type machines and a lot of companies’ owners are paying (very) well their specialists. In Switzerland we have a very good system for apprenticeship. Unfortunately the world of mechanical engineering isn’t that appealing for young people…

    Posted by Pierre-Yves Kohler

  6. Jeff

    It is a significant struggle to find people to work in manufacturing world wide well, westen world wide anyway. Kids would rather sell cell phones at a mall kiosk then get dirty standing next to a loud machine all day. Also the prestige factor, kids have been told by parents “we want you to be Dr.s. Lawyers, and Accountants we don’t want to see you work hard like we did” even though it was the working hard that got them the stuff they have. The idea that you need a degree to be someone in the world has also been pressed in so hard by multiple sources (media, government, edcuation systems) that kids feel manufacturing is beneath them. Manufacturers again need to realize this is something they allowed to happen over the last 20 years.

  7. Vic Wieland

    Everyone in the USA wants to be “Vice president” because of the huge (unwarranted ) salary gap between the actual workers and the bosses . Up to 20x bigger salary for being in management vs x4 for most of the rest of the world .
    Why wouldn’t you want to be be part of the overpaid, airconditioned, fat benefitted management ??

  8. Dave Bradley

    Lloyd, you need to get out from under the rock you live under, unless you are just trying to stir things up. Maybe what you are talking about depends on where you are standing. And obviously, you are not standing in my shoes. Usually you are the one with words of encouragement that things are looking better, as you sold a couple more machines, or saw someones shop where they think they might survive. But your words today were pretty pig headed. I’m disappointed in you. You sounded like the typical Chicago fat cat that wants Presidential material for apprentice wage, and still sends work to the Phillippines because it’s cheaper.



  10. Andre

    I am a senior at Purdue University Calumet in Construction Managing Engineering Technology with a 3.2/4.0 GPA. I live in northwest Indiana (Munster, just on the Illinois/Indiana border) and would love the opportunity to learn a manufacturing job. I know AutoCAD and am good with technical and mathematical things. I’m a hard worker and would be grateful for a job at a good company that pays an honest wage and is willing to train me. I would be happy to take courses to learn more too. I will start two evening classes in the fall but can still work full time during the day or night. I am available to start immediately and can send my resume and references. Please email me at andreaniakou@yahoo.com or call my cell 224-200-5668 any time. Thanks.

  11. kenc911

    I was in a plant yesterday with a sign on the front lawn that said they were looking for machining trainees. They are getting a steady trickle of interested callers, mostly Hispanics and Eastern Europeans. Yes American citizens to be replaced probably by illegals. Of course they plan to pay them 1/4 what the previous staff made. No unions. Their way.

    Now in the end what does that do for the american economy.

  12. Lloyd Graff

    To Kenc911
    Of all the posts and comments over the last several years yours may be the most incredibly ignorant and racist.

  13. Doug Brewer

    I own a small machine shop in Wixom, Mi. I was curious about this article, because its something we discuss in my family here in Michigan. Yea your right, all the big shops want inexperienced people so they can pay them minimum wage and low benefits if any, and why is this because all the good work is being done in China, Vietnam, Thailand, Korea, South America, and Mexico. The big shops here have to be competitive with foreign country’s, so therefore the low wages and no benefits. My brother is a program manager for Chrysler and he has been told to send all his work to China, what work he does here is owned by a German Company. When we start making things in America again we will have plenty of good paying manufacturing jobs again, period.

  14. Doug D

    When I got into the machining world back in 1976 apprenticeships were a standard in most large factories. We had Tool and Die, Toolmaker, Moldmaker, Patternmaker, Precision Machinist and Machine Tool Repair. In the late 80’s you would be hard pressed to find a Tool and Die aprrentice. In the 90’s you had people that were part changers on CNC’s calling themselves CNC operators because that’s the name the company gave them. Even though they had no idea how to change a tool or what it was even called. Companies got most of their items from China because of lower cost due to cheaper labor. HOGWASH !! It is was because of cheaper materials. We found it was cheaper to buy the tools from China (of which they were always wrong) and modify them when we got them. Although they NEVER lasted as long as tools made with US steel and labor. The US made tools lasted 3 to 4 times longer.
    We did this to ourselves, because we demanded a lower price, not a better value. We let the accountants determing our buisiness plan instead of using sound business practices.
    Good and profitable companies don’t locate beacuse of lower taxes, they locate for the talent and support of labor.

  15. Diana Sterling

    Everyone on TV is screaming that there are no jobs, but no one ever mentions how many millions of jobs have moved to foreign countries. The large (and smaller) aircraft OEM’s in Wichita, KS, now all have plants around the world. Why did this happen?….because our Government made it easy and profitable for it to happen! Now they just can’t figure out why there are no jobs. Seems like a “no brainer” to me!

  16. RichardS

    If and when we go into trade war or, God forbid, a shooting war with China over something inevitable like Taiwan, we will be utterly helpless without manufacturing and skilled labor to make things. Why can’t our government see that?


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