Labor Force Participation Rate from 2007 (Pelosi/Reid) to 2013
Jay Richards tweeted this article from the Wall Street Journal. The article is an interview with a business owner named Bob Funk whose job it is to match job seekers to job creators.
Hiring is down because of increased regulation of employers and fear of interventionism:
Here’s something you don’t often see in Washington: a businessman trying to repeal a law that helps his company. That’s Bob Funk’s latest mission in life. He’s the president and founder of Express Employment Services, the fifth-largest employment agency in America, with annual sales of $2.5 billion and more than 600 franchises across the country. This year he will place nearly half a million workers in jobs.
“ObamaCare has been an absolute boon for my business,” he says as we sit in his new office headquarters near downtown Oklahoma City. “I’m making a lot of money thanks to that law. We’re up 8% this year. But it’s just terrible for the country. I see that firsthand every day.”
Why is the health-care law good for Express but bad for the country? “Firms are just very reluctant to hire full-time workers,” Mr. Funk says. “So they are taking on more temporary help, which is what we do.” ObamaCare imposes new mandates and penalties on companies with more than 50 full-time employees—and even those working 30 hours a week are considered full-time.
He quickly adds: “The problem isn’t just ObamaCare, though. It’s the entire regulatory assault on employers coming out of Washington—everything from the EEOC”—the Equal Employment Opportunity Commission hits companies hard when employees claim age, race or sex discrimination—”to the Dodd-Frank monstrosity. Employers are living in a state of fear.”
So let’s take a look at what is causing a record low labor force participation rate.
The younger generation does not have a good work ethic:
The primary jobs problem today, Mr. Funk says, is that too many workers are functionally unemployable because of attitude, behavior or lack of the most basic work skills. One discouraging statistic is that only about one of six workers who comes to Express seeking employment makes the cut. He recites a company statistic that about one in four applicants can’t even pass a drug test.
“In my 40-some years in this business, the biggest change I’ve witnessed is the erosion of the American work ethic. It just isn’t there today like it used to be,” Mr. Funk says. Asked to define “work ethic,” he replies that it’s fairly simple but vital on-the-job behavior, such as showing up on time, being conscientious and productive in every task, showing a willingness to get your hands dirty and at times working extra hours. These attributes are essential, he says, because if low-level employees show a willingness to work hard, “most employers will gladly train them with the skills to fill higher-paying jobs.”
He fears that too many of the young millennials who come knocking on his door view a paycheck as a kind of entitlement, not something to be earned. He is also concerned that the trendy concept of “life-balancing” is putting work second behind leisure.
Welfare spending discourages people from working:
When pressed to explain what Washington can do to get Americans back on the job, Mr. Funk says the first step would be to start shrinking the “vast social welfare state programs that have become a substitute for work. There’s a prevalent attitude of a lot of this generation of workers that the government will always be there to take care of them. It’s hard to get people to take entry-level jobs when they can get unemployment benefits, health care, food stamps and the rest.”
This week during the food-stamp debate in Congress, Democrats voted unanimously against work requirements and ridiculed Republicans who suggested that the expansion of food stamps to 47 million Americans has discouraged working. The Democrats are living in a fantasy world, according to Mr. Funk. He points to Congress’s decision in 2009 to increase unemployment-insurance benefits to 90 weeks or more as “a policy that held a lot of people out of the workforce until the checks stopped coming. We saw that here very clearly.”
Disability makes people less inclined to get a job:
The most abused government program, he says, is disability insurance and the 14 million Americans who now collect these benefits. Express has found that over half of the disability claims brought by its workers have turned out to be fraudulent. “We win 90% of the disability cases that we challenge in court,” Mr. Funk says.
Skills deficit makes people less employable:
Another big hurdle is the widening skills deficit. At any given time, Mr. Funk says, Express has as many as 20,000 jobs the company can’t fill because workers don’t have the skills required. His advice to young people who are looking for a solid career is to get training in accounting (thanks to Dodd-Frank’s huge expansion of paperwork), information technology, manufacturing-robotics programming, welding and engineering. He’s mystified why Express has so much trouble filling thousands of information-technology jobs when so many young, working-age adults are computer literate.
Public schools and universities don’t prepare people for work:
He blames public schools and universities for the skills mismatch. Young people looking for a financially secure future might want to heed one of his favorite pieces of cautionary advice: “If you’ve got a college degree in psych, poly-sci or sociology, sorry, I can’t help you find a job.” He urges greater emphasis on vocational and practical skills training in schools, universities and junior colleges.
With so many ideas about how to help get the country on track, Mr. Funk might seem ripe to enter politics, but he already made one electoral foray—he was a local school-board member for 11 years—and found it an exercise in pure frustration. Bringing his pay-for-performance values to the board, he spent years futilely trying to get rid of bad teachers and to reward “the 30% that are really good.”
He says “teacher tenure is by far the most corrupt social institution in our time, because it doesn’t reward excellence or weed out bad teachers.” The teachers union had operational control of the school board, and Mr. Funk couldn’t get them to budge. He says the union celebrated when he left the board.
I think that this shows the important of having private sector experience in a President. When you are looking to hire a President, you want to hire someone who has already done what he claims he wants to do, at a smaller level. If you want someone to fix health care, pick someone like Bobby Jindal who has already done it in his state. If you want someone to make schools accountable, pick Scott Walker. If you want someone to cut spending, pick Rick Scott. If you want someone to create jobs, pick Rick Perry. If you want someone to balance the budget, pick John Kasich. Pick a candidate who can do the work. Not someone who passionately speaks about how he wants to do the work. Pick someone who has been fabulously successful at actually doing what he says he wants to do.
Our current President knew nothing about running a business or how jobs are created when he was elected. He was just a community organizer. Never did a thing in the private sector. Maybe he could get lucky at making policies that would create jobs, but “lucky” our best option? Next time, let’s not take chances. Pick someone who has proved that he can do the work based on past performance. Not speeches.
Filed under: News, Employment, Jobs, Labor Force Participation, Obamacare, Regulation, Unemployment, Worker