You know, I used to think the same way --education. But Europe, Germany in particular, stresses education, and that has not saved them from having overqualified people and too few jobs for them. It also minimizes the fact that not all people have the aptitude to learn and obtain higher degrees. It's a race to the top and in that race there will always be people below who feel left out. So education can only offer so much --not all.
To add, educated people without a job feel even worse than undereducated people who don't have a job because they believed education would insulate them from these issues when it might not.
As someone on the employer side of the table I see two frequent problems with university educated candidates that generally don't land the job:
1) irrelevant or (professionally) useless degrees. These would be fine but because they have a degree these candidates generally think they deserve a higher wage which I can't afford (before you say "but general knowledge is valuable as well" remember that self-taught candidates with similarly well-rounded knowledge generally demand less despite often having actual job experience)
2) complete lack of practical knowledge or skills. Even if a degree is job-related that doesn't mean they are capable of doing the job or have the frame of mind required to do the job properly. This is especially a problem with people who picked their majors based on what industry currently provides the best salaries rather than what they are actually interested in doing.
These are especially problems for people who went into university without knowing what they want to do professionally. TINSTAAFL but even if you just get a degree to orient yourself and pass time until you have figured out what you actually want to do with your life that can affect your employability.
As someone on the employer side of the table I see two frequent problems with university educated candidates that generally don't land the job
As someone who has sat on both sides of this table, let me point out that pathologies in hiring are very, very hard for a company to spot. After all, who is going to advocate the contrarian position? The ones not hired aren't there. Observers who are there often don't have anything immediate to gain and lots of political capital to potentially lose.
complete lack of practical knowledge or skills.
If those skills are valuable and hard to find, then it's an advantage to be able to impart those, for both a company and a country.
> If those skills are valuable and hard to find, then it's an advantage to be able to impart those, for both a company and a country.
Sure, but as a small company we can't afford to pay someone a "graduate level" salary when the best we can they need "unskilled level" training before becoming productive at all.
I'm not speaking of a Fortune 500 company or a AAA-level VC-funded startup. We have tight profit margins yet we try to take paid interns and students (which is a net loss for us because we actually train them rather than simply abusing them as cheap labour) because that's the right thing to do.
I'm also speaking from my experience of working closely with people running similar companies (let's say up to ~10 permanent employees) in Germany.
That said, in many cases someone with 3 years of actual job experience is more productive (in the short-to-mid term) than a recent graduate with 3 years of university (with no practice). Yet the graduate will often cost you more in Germany because of inflated salary expectations (partially caused by people reading about US startups and thinking the numbers transfer 1-to-1).
I am talking about entry level jobs. And I'm not even talking about my own company in particular. I've seen this in enough other companies and heard it from enough other people to be certain this is more than purely anecdotal.
There is a false impression in Germany that a university degree increases the chance of finding a job. But it's neither necessary (depending on the industry) nor sufficient.
The kind of companies that can and are willing to pay inflated salaries for graduates with no practical experience or useless degrees are oversaturated and the rest just can't afford them because it's not profitable.
Another way this problem manifests itself is students thinking they can or should specialise in niches when the only jobs that don't require experience require them to be generalists (because if you're going to specifically hire a one-trick pony you probably want a good one).
I've literally seen a fresh graduate apply to become a "colour consultant" in a full-service marketing agency. Sure, they might need someone who really knows their colour theory well but the scale at which a company can justify making that task a full-time job AND giving that job to a fresh graduate with no hands-on experience is pretty implausible.
Germany, the Bundesbank and their FinMin have a very flawed view of macroeconomics. They seem to have a hard time understanding how money recycling works or there is more than pure economics at play.
The German political class has been keeping wages lower then they should be on purpose. While export corporations have boosted their profits the last 15 years, wages have been kept much lower than they ought to be, killing the competition elsewhere and destroying a sort-of natural recycling mechanism which should protect the other members of their Eurozone: A worker in Germany should be paid 4 to 5 times more than a worker in Portugal.
Indeed the current German surplus is a major problem in EU's economy. Y. Varoufakis, M. Draghi and B. Bernanke have spoken about this openly time and again (see links).
By definition in a monetary union, your surplus[3] is someone else's deficit, but if you take a look at the rhetoric PIIGS are to blame for their poor financial track-record. Someone is simply having his cake and eating it, but not for long.
It's funny that with a 12.1B in surplus the AfD (right-wing nazi-friendly political party) is on the raise in Germany, isn't it?
Definitely. The trades only make as money as they do because the supply of skilled tradesmen is intentionally limited by selective apprenticeships being the barrier to entry. Today, one can not become an electrician or plumber without said apprenticeship.
Increase the number of electricians or plumbers 10-fold and their wages would plummet.
I'm sure that's true, but it still doesn't solve your employment issues, and you are just hurting wages for all existing plumbers. There are only about half a million plumbers in the US [1]. Even if you managed to triple the number, you're not making much of a dent in overall employment.
Sure, my point was just that if vocational jobs are naturally X% of the US economy, you're (largely) not 'creating jobs' just by making it easier for people to get trained for those vocations, you're just creating more competition within that sector and driving down wages of existing workers in the process.
That said, it might still be a worthwhile policy to pursue, since vocational education has been neglected for decades in favor of 'college for all', which IMO is misguided.
Vocational training is certainly part of your toolkit to increase jobs prospects for unemployed underemployed people who are willing to work, but it's not the whole toolkit. It helps, but you need more than that.
Those are also highly rigorous jobs that can put a toll on the human body. Not many people really want to retire with pain. That being said, I'm not sure what the alternative for some individuals are. Maybe being on your feet a lot increases your overall well being, I'm not the expert on that.
This is a key conceit - trades don't mean one is less intelligent. A great plumber is easily as intelligent as a great software dev. The left behind are the people who could provide value before, but now can't, and no amount of reeducation will solve that.
I feel that it is very easy to get trapped in the mindset that I am owed something based on my prior experience. Reluctance to think beyond past experience, fear of leaving behind what I worked hard to learn, or fear of failure in a new area are all things that have held me back in my own life.
I would disagree that people can not provide value beyond what they did before. Except in cases of physical or mental disability, it's more likely a self-imposed barrier.
> [...] and that has not saved them from having overqualified people and too few jobs for them.
They had labour market inefficiencies and weak demand.
The US labour market is a bit more flexible. And since they are issuing their own currency, they can always print more to stoke demand. (Ideally, the Fed would target nominal GDP.)
Good news: the Germans are having a much lower unemployment rate these days than in the late 90s.
It's even worse in places where government, either directly or through unions, set the base salaries for people with certain education levels. Then you have higher education, no job, and are unable to be hired doing less education demanding jobs because otherwise they would be forced to pay you an absurd salary for your position.
You're basically fucked. But then government comes to the rescue again giving handouts! Yay... thanks for temporarily solving a problem that you shouldn't have created in the first place.
To add, educated people without a job feel even worse than undereducated people who don't have a job because they believed education would insulate them from these issues when it might not.