Saturday, November 26, 2011

Two Answers For Jobs

There were two interesting pieces on jobs in today's WSJ.

The first, was an editorial called The Non-Green Jobs Boom:

The Bureau of Labor Statistics reported recently that the U.S. jobless rate remains a dreadful 9%. But look more closely at the data and you can see which industries are bucking the jobless trend. One is oil and gas production, which now employs some 440,000 workers, an 80% increase, or 200,000 more jobs, since 2003. Oil and gas jobs account for more than one in five of all net new private jobs in that period.

The ironies here are richer than the shale deposits in North Dakota's Bakken formation. While Washington has tried to force-feed renewable energy with tens of billions in special subsidies, oil and gas production has boomed thanks to private investment. And while renewable technology breakthroughs never seem to arrive, horizontal drilling and hydraulic fracturing have revolutionized oil and gas extraction—with no Energy Department loan guarantees needed.

The oil and gas rush has led to a jobs boom. North Dakota has the nation's lowest jobless rate, at 3.5%, and the state now has some 200 rigs pumping 440,000 barrels of oil a day, four times the amount in 2006. The state reports more than 16,000 current job openings, and places like Williston have become meccas for workers seeking jobs that often pay more than $100,000 a year.

Or take production in Pennsylvania's Marcellus shale formation, which the state Department of Labor and Industry says created 18,000 new jobs in the first half of 2011. Some 214,000 jobs are now tied to a natural gas industry that barely existed in the Keystone State a decade ago. Energy firms are also rushing to develop the Utica shale in eastern Ohio, and they are expanding operations in Texas, Louisiana and Oklahoma, among other places.

Good news? You'd think so, but liberals can't seem to handle this truth so they are now trying to discredit the jobs that accompany it. The American Petroleum Institute recently commissioned a study by the Wood Mackenzie consulting firm, which estimated that better federal energy policy would create an additional 1.4 million jobs by 2030.

I still find it stunning that a leader of any country would not embrace opportunities to create jobs and secure more stable sources of energy. In fact, there are few other world leaders besides President Obama who limit their own country's abilities to develop energy sources as our current president has. If the 2012 election were a referendum on energy policy alone, I would expect that any Republican candidate would easily have the upper hand versus President Obama as developing America's energy resources and creating jobs is such a common sense solution that an overwhelming majority of Americans would support it.

The second was a front page article on how even in these times of high unemployment, companies are still struggling to fill jobs that require technical skills (sub req):

Her challenge is a familiar one to recruiters, especially in industries that require workers with trade skills such as welding. Union Pacific struggles to find enough electricians who have worked with diesel engines. Manufacturers in many places can't find enough machinists. Oil companies must fight for a limited supply of drilling-rig workers.

"There's a tremendous shortage of skilled workers," said Craig Giffi, a vice chairman of the consulting firm Deloitte. A recent survey it did found that 83% of manufacturers reported a moderate or severe shortage of skilled production workers to hire.

Such scarcities can have an outsize effect. Though companies may be able to get their unskilled work done by shifting around existing staff or using temps, a shortage of skilled workers is harder to finesse. The Deloitte study found that 74% of manufacturers said a shortage of skilled production workers had a "significant negative impact" on either their productivity or expansion plans.

AAR Corp., a Chicago-based aviation-parts manufacturer, has 600 job openings, mostly for skilled trade jobs like welders and maintenance mechanics. Chief Executive David Storch said the shortage of workers has forced the company to pass up business and delay some manufacturing work. He said the company would like to start a third shift at its Indianapolis aircraft maintenance facility but has been unable to do so because of worker shortages.

"It's a little bit frustrating to sit around and talk about the ability to grow your business if you could only hire skilled people," Mr. Storch said.

For all the angst about jobs being outsourced overseas and the disappearing middle-class, the reality is that if there are plenty of jobs around (and there always will be) that require some technical training, but not a four-year college degree. Far too many people are going to college who have business being there, while far too few people are being trained in the technical trades that companies are looking for. These technical trades may not have the same top end that other careers that require a degree do, but most pay pretty well and provide workers with an opportunity to make a decent living and lead what has been traditionally regarded as the middle-class American life. As the Boomers continue to, in most cases at least, less than gracefully ease into retirement, the demand for this types of technical skills will continue to increase. Instead of pushing everyone down the college path, we need to create more opportunities for kids leaving high school to have access to the technical training they need and encourage them to explore them.