FacebookTwitterRedditEmail

It’s Going to be a Long, Hard Recession

When the unemployment rate goes up, a standard theme in the media is that workers don’t have the right skills. We saw that yesterday in the New York Times when an article told us “The Pandemic Has Accelerated Demands for a More Skilled Workforce.” It tells us how the growth of telecommuting in response to the pandemic has led to more demand for skilled labor and less demand for less-skilled workers.

The key point in this sort of argument is that the problem is the workers, who don’t have the right skills, not an economy that doesn’t create enough demand for labor. Of course, we get this skills shortage argument every time the unemployment rate soars. In the summer of 2010, when the Great Recession was still near its trough, the NYT ran a piece telling us about the skills shortage in manufacturing. Over the next nine and a half years the sector added almost 1.3 million jobs (11.3 percent), without any notable improvement in the skills of the U.S. workforce. The overall unemployment rate fell to 3.5 percent, again without any major gains in skills in the U.S. workforce.

The focus on the skills gap is even more infuriating since even if there were an issue with demand for skills that would be the result of policy, not technology, as the piece implies. We have lots of jobs in areas like computers and biotech because the government gives out patent and copyright monopolies in these areas. If we are worried that we are creating too much demand for people with advanced skills and not enough demand for people with less education, we can make these monopolies shorter and weaker, or perhaps not even have them at all.

The latter possibility should be a major topic of debate in the context of the pandemic. The government is paying billions of dollars to drug companies for research and testing of various treatments and vaccines to combat the coronavirus. Incredibly, after putting billions of dollars upfront, and taking the big risks, the government is giving the companies patent monopolies which will allow them to charge whatever they want for what was developed on the government’s nickel.

This will likely mean redistributing tens of billions from everyone else to the shareholders, top executives, and key employees in these companies. If we don’t want to see this upward redistribution (also from Black to white, since the beneficiaries in this story are almost certainly overwhelmingly white) the key is not more skills for our workers, the key is for the government not to be giving out patent monopolies for work it has paid for.

To be clear, this is not an argument against education and training. It would be good for workers and the economy if we had a better-trained workforce. But the reason we have high unemployment today, and may have high unemployment for some time into the future, is not a lack of skills, it is a failure of economic policy.

This column first appeared on Dean Baker’s Beat the Press blog.

More articles by:

Dean Baker is the senior economist at the Center for Economic and Policy Research in Washington, DC. 

August 12, 2020
Melvin Goodman
Trump’s War On Arms Control and Disarmament
P. Sainath
“We Didn’t Bleed Him Enough”: When Normal is the Problem
Riva Enteen
Kamala Harris? Really? Desperate Times, Desperate Measures
Kenneth Surin
The Decrepit UK Political System
Robert Hunziker
Freakish Arctic Fires Alarmingly Intensify
Ramzy Baroud
The Likud Conspiracy: Israel in the Throes of a Major Political Crisis
Sam Pizzigati
Within Health Care USA, Risk and Reward Have Never Been More Out of Kilter
John Perry
The US Contracts Out Its Regime Change Operation in Nicaragua
Binoy Kampmark
Selective Maritime Rules: The United States, Diego Garcia and International Law
Manuel García, Jr.
The Improbability of CO2 Removal From the Atmosphere
Khury Petersen-Smith
The Road to Portland: The Two Decades of ‘Homeland Security’
Raouf Halaby
Teaching Palestinian Children to Love Beethoven, Bizet, and Mozart is a Threat to a Depraved Israeli Society
Jeff Mackler
Which Way for Today’s Mass Radicalization? Capitalism’s Impending Catastrophe…or a Socialist Future
Tom Engelhardt
It Could Have Been Different
Stephen Cooper
Santa Davis and the “Stalag 17” Riddim
August 11, 2020
Richard D. Wolff
Why Capitalism is in Constant Conflict With Democracy
Paul Street
Defund Fascism, Blue and Orange
Richard C. Gross
Americans Scorned
Andrew Levine
Trump and Biden, Two Ignoble Minds Here O’erthrown
Patrick Cockburn
The Rise of Nationalism Has Led to the Increased Repression of Minorities
Sonali Kolhatkar
Trump’s Presidency is a Death Cult
Colin Todhunter
Pushing GMO Crops into India: Experts Debunk High-Level Claims of Bt Cotton Success
Valerie Croft
How Indigenous Peoples are Using Ancestral Organizing Practices to Fight Mining Corporations and Covid-19
David Rovics
Tear Gas Ted Has a Tantrum in Portland
Dean Baker
There is No Evidence That Generous Unemployment Benefits are Making It Difficult to Find Workers
Robert Fantina
War on Truth: How Kashmir Struggles for Freedom of Press
Dave Lindorff
Trump Launches Attack on Social Security and Medicare
Elizabeth Schmidt
COVID-19 Poses a Huge Threat to Stability in Africa
Parth M.N.
Coping With a Deadly Virus, a Social One, Too
Thomas Knapp
The “Election Interference” Fearmongers Think You’re Stupid
Binoy Kampmark
Mealy-Mouthed Universities: Academic Freedom and the Pavlou Problem Down Under
Mike Garrity
Emperor Trump Loses Again in the Northern Rockies in Big Win for Bull Trout, Rivers and the ESA
Alex Lawson
34 Attorneys General Call to Bust Gilead’s Pharma Monopoly on COVID Treatment Remdesivir
August 10, 2020
Gerald Sussman
Biden’s Ukrainegate Problem
Vijay Prashad – Érika Ortega Sanoja
How the U.S. Failed at Its Foreign Policy Toward Venezuela
Daniel Warner
Geneva: The Home of Lost Causes
Mike Hastie
The Police Force Stampede in Portland on August 8, 2020 
Jack Rasmus
Trump’s Executive Orders: EOs as PR and FUs
Rev. William Alberts
Cognitive Without Conscience
David Altheide
Politicizing Fear Through the News Media
F. Douglas Stephenson
Is Big Pharma More Interested in Profiteering Than Protecting Us From Coronavirus?
Evaggelos Vallianatos
The Money Plague
Howard Lisnoff
Revolutionaries Living in a System of Growing Fascism
Ralph Nader
Donald Trump is Defeating Himself
Lynnette Grey Bull
The Murdered and Missing Indigenous Women Human Rights Emergency is Not a Photo-Op for Ivanka Trump
FacebookTwitterRedditEmail