by CHRC | Jul 8, 2020 | Competencies, Human Capital, Skilled Labor
So last weekend, I was probably the only person I know who wasn’t ready with popcorn and our newly purchased Disney+ waiting anxiously for Hamilton to premiere. I don’t have every word memorized. Much to the dismay of my husband and daughter, I did at one point put on headphones to watch a Tik Tok during the viewing party (do I at least get points for knowing what Tik Tok is?). But for all of you Hamilton fans out there, I want you to know a few themes and a few lines have finally sunk in!
That’s why when I came across this article yesterday, I thought, how timely. As we struggle as a country with rising COVID-19 numbers, and some are quick to blame other countries, it’s important to be reminded of the hard work immigrants have put in during these trying times. Much like in Hamilton, Peter Tsai, the man who invented the N95 mask, is “Non-Stop” finding ways to use, and RE-use, them to their full potential and continue to work for the safety of others in his adopted land.
As we continue to find new ways to run businesses, care for our employees, and see our families during this pandemic, we can look to Peter as an example of how to take something we’ve already succeeded at—and know that we can always be improving it. When in doubt, remember, “Immigrants, we get the job done.” Read More Here
by CHRC | May 29, 2020 | Economy, Human Capital, Labor Markets, Skilled Labor
For many years, we have been working with clients to explain the difference between labor market differentials and cost of living differentials, two related, but different numbers. Obviously, Mark Zuckerberg has never called us to ask for a tutorial. Put simply, it explains why a cold Midwesterner might give up a 4,000 square foot house to live in a 1,000 square foot home in San Diego—yet pay the same for both dwellings. While a basket of goods might cost more in San Diego, that same former Midwesterner will gladly pay it because they intend on never wearing a parka again, and spending more time outdoors, in the sun, than inside sheltering from the cold.
Labor costs, on the other hand, are all about the supply and demand of certain skills. If too many former Midwesterners with the same set of skills move to San Diego all at the same time, the labor market floods, and the price for their labor goes down. Perhaps the newly warm people don’t care?
Labor markets have been shifting along geographic lines since the US began to emerge from the 2008-2009 financial crisis. CHRC began to see it when clients would call with one-off jobs that were suddenly experiencing turnover, and they couldn’t believe it was due to an increase in wages, but it was. One project, in particular, clearly painted this new picture. We examined roles at various income levels across the entire US expecting all geographies to converge to a national geographic differential of 0% at some point; for all these geographies, north, south, east, west, rural, urban—they never did. The correlations that compensation consultants had typically seen to explain geographic differentials no longer held.
Our observations are well explained by the writings of economist, Enrico Moretti, including his book, The New Geography of Jobs. He uses examples to explain how the concentration of industries and human capital in certain areas leads to innovation (e.g. Detroit at the beginning of the 20th Century or Silicon Valley at the end of the century).
So, what will happen if tech talent is incented away from the Bay Area? Will this de-concentration dilute both talent and innovation? Perhaps it could drive down housing costs and the cost of living (but probably not proportionally). Our advice to Mr. Zuckerberg is that the law of unintended consequences will probably take over; the labor market pricing for talent will hold, people will take their talent to other firms, and move wherever they like. The new recipients of their talent will innovate with it. Mr. Zuckerberg might very well be left with those workers whose skills are not nearly as in demand, who are less likely to innovate, and who are very grumpy about their cost of living. Read More Here
by CHRC | Apr 29, 2020 | Competencies, Human Capital, Productivity, Skilled Labor
The Covid-19 pandemic has had many learning curves, and no doubt there are many still to come. Those amongst us who never much liked science or statistics have now become quite comfortable with the concepts of R0 and R1, exponential curve rates and trajectories of respiratory droplets.
Hidden behind the vast statistics of those who have died are the lives lived by each of this virus’ victims. Americans have gained a new-found appreciation of the vital role that “essential workers” play in our everyday life. Not just the essential workers that are first responders and medical workers, but those in so many businesses that do the invisible work. In the case of Cesar Quirumbay, truly invisible work.
One of those lives prompted Matthew Miller to write to the New York Times to laud the talents and mourn the man from the back room who could sew invisible stitches and smooth wrinkles away. He instructs us that “every obituary is both a remembrance of a life ended and an instruction to those of us still living.” In HR terms, the author and the late Mr. Quirumbay’s boss describe competencies that any employer dreams of: modesty, diligence, collaboration, teamwork, attention to detail, and sophisticated communication skills. For a labor economist, Mr. Quirumbay’s death highlights another cost of this pandemic—the cost of losing human capital while still on the upwards arc of the productivity curve. As for valuing that work, that invisible work, it is skilled labor that took over 20 years to develop and hone. It cannot be replaced easily. Read More Here
by CHRC | Jan 29, 2020 | Competencies, Human Capital, Skilled Labor
Some of the most fun we have as compensation consultants is when a client says: “this is such an unusual job; you will never be able to price this job.”
What makes our job so interesting? Sleuthing to find such a unique set of skills to fulfill even the rarest roles. The minute I read this headline, I was intrigued not just because I love the costumes on this TV show, but because I immediately thought, “Where would you even find that person?” “What sort of background would they need?” “What knowledge, skills, and ability does a job like that require?” Once those questions are answered, then we can start finding matched roles and salaries.
The beauty of this article? The interviewer did his job; he obviously asked all the right questions, because the article answers all the specifics required to dress Midge Maisel.
Perhaps we should see if this interviewer would like to become a compensation consultant? Read More Here
by CHRC | May 2, 2018 | Labor Markets, Skilled Labor
You may have seen the article in Monday’s WSJ that spoke about towns and companies enticing younger people to move with $5,000 to help pay student loans or pay for a house. Mike Allgrunn, an economist at the University of South Dakota, dubs these “a modern-day Homestead Act.”
From the above graph, courtesy of the Atlanta Fed, you can see the one demographic driving higher wages: youth. Run this graph through its various iterations: education, race, and census division; none of these statistical parsings come close to showing the large wage difference for just being young. Why? Because we have a shortage of young workers. Especially young, skilled workers. Here’s another great article from Reuters. Read More Here
by CHRC | Jun 9, 2017 | Diversity, Equity, Inclusion, Human Capital, Labor Markets, Skilled Labor
Many baby boomers intend to work past retirement age, and one article contends they will potentially overcrowd the job market. The article goes on to say this could create a problem for both younger and older workers. If the overcrowding keeps wages lower, then older workers might need to work much longer to acquire the retirement savings they desire, and, “if employers end up using older workers instead of younger workers, this could also lower wages for younger workers or slow down their wage growth, the researchers say.”
But, this article presents a flawed argument, because many of the positions baby boomers currently hold are not the same jobs that are opening up for new college grads or entry level workers. In fact, some positions baby boomers fill right now are getting harder and harder to fill because of the expertise and experience level they require. Meanwhile, the reason fewer jobs were filled last month? The lack of skilled labor to fill it. Read More Here and Here
