Blog Archives

Career Advice to 20-Somethings: Create Value as a Mobile Creative

Establishing a satisfying career is difficult in today’s economy, doubly so for those who find life within hierarchical institutions (corporate America and government) unrewarding, and triply so for those burdened with student loan debt and college educations/diplomas of uncertain market value or those re-entering the job market with skills that have been marginalized.

Given that I wrote a book entitled Get a Job, Build a Real Career, and Defy a Bewildering Economy, it’s unsurprising that I get emails from young people asking for career advice.

I’ve also written essays of friendly advice such as A Teachable Moment: to the Young Person Who Complained About Her Job/Pay at Yelp and Was Promptly Fired.

Here is my response to a recent email from a 20-something in a familiar place:burdened with student loan debt, aware that the self-serving institutional shuck-and-jive is false (get a college degree and your future is secure), and uncertain how to proceed.

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The Real Cause of the Opioid Epidemic: Scarcity of Jobs and Positive Social Roles

We all know there is a scourge of addiction and premature death plaguing the nation, a scourge that is killing thousands and ruining millions of lives: the deaths resulting from the opioid epidemic (largely the result of “legal” synthetic narcotics) are mounting at an alarming rate:

We also know that the proximate cause of this epidemic is Big Pharma, which promised non-addictive painkillers that lasted for 12 hours but delivered addictive painkillers that did not last 12 hours.

The unsavory truth was reported by the Los Angeles Times last May (2016) in a scathing investigative series: ‘You Want a Description of Hell?’ Oxycontin’s 12-hour problem.

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Want to Bring Back Jobs? It’s Impossible Unless We Fix these Four Things

If there is any goal that might attract support from across the political spectrum, it’s creating more fulltime jobs in the U.S. But this laudable goal is dead-on-arrival (DOA) unless we first fix these four things. Why is job growth stagnating? Many point to automation, and yes, that is a systemic dynamic that will only expand going forward.

But much of the stagnation is the direct result of the high costs and structural failures in these four inputs to the job market. U.S. healthcare costs more than twice as much per person as healthcare per person in our advanced-economy competitors. Why would anyone open a business in a nation so poorly run that healthcare costs twice as much as it does everywhere else?

The American people are not healthy. Obesity / obesity-related diseases and opiate addiction are both epidemic. Workers struggling with lifestyle-caused chronic diseases cost more to hire and to help.

If you set out to destroy the nation’s ability to create jobs, you’d impose the unaffordable healthcare system we have, and the overly complex and costly tax / regulation system we have. And you’d push your students to get useless credentials instead of the real-world skills, moxie and values they need to get ahead and fulfill their potential in a fast-changing economy.

You want to create jobs? First fix these four things, or your goal is DOA.

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Where Are the Jobs? Mostly In Big Cities

It’s well known that millions of the jobs counted in employment statistics are part-time or low-paying “gig economy” self-employment. Over 9 million self-employed workers make less than $10,000 per year, and 5.5 million earn less than $5,000 per year. Granted, many of these workers may have other employment, but the point is millions of jobs that are puffing up official job totals are not full-time or even close to full-time.

Endangered Species: The Self-Employed Middle Class

Nonetheless, employment and new small businesses are expanding in some locales. According to this new study, The New Map of Economic Growth and Recovery (eig.org), growth in jobs and new business has become increasingly concentrated in a handful of high-population metropolitan counties.

In the high-growth early 1990s, half of all new businesses sprouted in 125 counties nationwide. In 2002-2006, the number of counties that were home to half of all new enterprises fell to 64. In the “recovery” years of 2010-2014, half of all new firms arose in a mere 20 counties nationally–an astonishing concentration.

We can see the asymmetry in this chart. Where counties with 1 million or more residents were home to 13% of new businesses in the 1990s, now 58% of business creation occurs in populous urban counties.

Here are the counties with the largest increases in employment (I’m listing only those with a 9% growth rate or higher).

1. Los Angeles CA 9.9%
2. Harris (Houston) TX 14.7%
3. New York NY 11.2%
4. Orange County CA 11.7%
5. Dallas TX 10.6%
6. Miami-Dade FL 14.7%
7.Santa Clara (San Jose) CA 13.7%
8. San Diego CA 9.2%
9. King (Seattle) WA 9.8%
10. Hennepin (Minneapolis) MN 11.4%
11. Tarrant (Dallas) TX 12.5%
12. San Francisco CA 16.8%
13. Oakland County (Detroit) MI 13.2%
14. Travis (Austin) TX 15.6%
15. Kings (Brooklyn) NY 15.0%
16. Orange County (Orlando) FL 11.7%
17. Hillsborough (Tampa) FL 13.9%
18. Mecklenburg (Charlotte) NC 13.2%

Not all of the jobs created in these urban centers are high-paying, of course.Some regions have more low-paying service jobs, and others have relatively more high-paying jobs.

Some of these locales have insanely high costs of living, which skews wage comparisons between regions.

Other than the welcome leap in jobs in Detroit, the big urban centers of growth are congregated on the Left and Right coasts and Texas (Minneapolis benefits from a concentration of corporate headquarters, universities and R&D–a mix that characterizes many of the job centers.)

The authors of the report reach some sobering conclusions about this geographic concentration of new businesses and new employment:

The geographically uneven nature of the decline in new business starts implies that large swathes of the country will soon contend with a missing generation of firms — ones that should be providing employment opportunities and new foundations for economic growth in the years ahead.

The uneven geography of new business formation tracks very closely with that of access to capital — particularly venture and other forms of risk capital. Addressing the former challenge will surely involve tackling the latter. Without mitigating these disparities, the trend towards increasing concentration documented here may even accelerate, given that today’s largest economic centers are the few remaining places producing tomorrow’s new businesses.

The new map of growth and recovery points to very different futures for American communities. These findings suggest that the gains from growth have and will continue to consolidate in the largest and most dynamic counties and leave other areas searching for their place in the emerging economic landscape.

The good news is that smaller cities have some advantages (much lower costs, for example) and they can generate meaningful, stable expansion of jobs and new businesses if they organize their efforts to maximize those advantages–and if they welcome new enterprises with an uncluttered, low-cost pathway to starting up.

There are a variety of messages buried in this data. One is: the more dynamic the business environment, the greater the opportunities to build networks, disrupt vested interests and find niches for small enterprises.

Cities that think luring one big corporation to locate a factory or office park in their area is the answer are deluded; that one big employer can decide to relocate or shut down operations in a heartbeat.

Maintaining the status quo of red tape, high taxes, high junk fees and indifference to small business realities guarantees decline and failure. The motto of the most dynamic elements of our economy is: trust the network, not the corporation or the state.

The local government can help by eliminating statutes and requirements that serve to protect sclerotic vested interests (forcing people such as florists to get absurdly unnecessary professional licenses, for example) or it can hinder it by looking on small business as tax donkeys who should be grateful for a chance to open a biz in town.

Guess what, folks–the tax donkeys can go elsewhere, to places where they are either welcomed or celebrated.

It’s all about networks and network effects: this may sound high-tech, but it’s just as true for a bakery as it is for a software company.

All About Network Effects (85-slide presentation)

The author of the recent book The Geography of Genius: A Search for the World’s Most Creative Places from Ancient Athens to Silicon Valley concluded that creative places share three essential characteristics: disorder, diversity and discernment.

In other words, the exact opposite of places designed to preserve the privileges of vested interests and a sclerotic status quo.

My new book is #11 on Kindle short reads -> politics and social science: Why Our Status Quo Failed and Is Beyond Reform ($3.95 Kindle ebook, $8.95 print edition) For more, please visit the book’s website.

 

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If You Want More Jobs and More Job Stability, Disrupt More, Not Less

Two recent studies reflect the ongoing rapid transformation of the U.S. economy: The New Map of Economic Growth and Recovery (eig.org)

The U.S. Labor Market Is Far More Stable Than People Think (itif.org)

I’ve addressed the dynamic mix of technical and entrepreneurial skills, social and financial capital and infrastructure of opportunities required to successfully navigate this transformation in my books Get a Job, Build a Real Career and Defy a Bewildering Economy and The Nearly Free University and the Emerging Economy: The Revolution in Higher Education.

Here’s the problem in a nutshell: job growth, new businesses and wage gains are becoming increasingly concentrated in a small number of geographic regions and a narrow class of workers / entrepreneurs while the overall economy struggles to maintain productivity gains, which are ultimately the only sustainable source of prosperity.

the productivity growth rate has been slumping since 2005.

Longer term, productivity gains have flowed to the top 5%–those workers and entrepreneurs with higher levels of education, ownership of assets and access to cheap credit:

This chart shows the concentration of income in the top tier: the top 5% have garnered the gains while the incomes of the bottom 95% have stagnated.

The overall employment picture has changed for the worse: the percentage of the populace that’s employed has fallen from peak periods.

The number of workers with full-time jobs has stagnated in the 2000s, breaking a 50-year trendline of steady growth of full-time jobs.

The growth of new businesses (annual change in the number of firms) has also cratered: business creation never recovered in the “recovery.”

The number of new businesses in the US is falling off a cliff

Growth in jobs and new business has become increasingly concentrated in a handful of high-population metropolitan counties. In the high-growth early 1990s, half of all new businesses sprouted in 125 counties nationwide. In 2002-2006, the number of counties that were home to half of all new enterprises fell to 64. In the “recovery” years of 2010-2014, half of all new firms arose in a mere 20 counties nationally–an astonishing concentration.

The point of The U.S. Labor Market Is Far More Stable Than People Think is that disruption generates more stability in the job market, not less. The obvious stagnation of employment and wages for the majority of workers has created a feeding-frenzy of potential explanations and causes, and this has led to all sorts of proposed policy tweaks.

The point here is: if you want growth and stability, disrupt more, not less. The vast majority of policy tweaks are ultimately aimed at protecting privileged classes from disruption and reducing disruption of the status quo–in government, higher education, healthcare, defense, etc.

Reducing disruption to protect the privileged status quo is akin to poisoning the patient to “protect them from harm.” The only way to successfully navigate a rapidly transforming economy is to embrace disruption by making it easier and cheaper to disrupt the protected status quo.

In my book The Nearly Free University and the Emerging Economy: The Revolution in Higher Education, I lay out a blueprint for reducing the cost of college by 90% while greatly improving the value of that education.

It’s Time to Ditch 4 Years of Costly College for Directed Apprenticeships (June 2, 2016)

One reason why jobs and entrepreneurial are increasingly concentrated in counties with high densities of population and capital is these locales possess the infrastructure of opportunity I describe in my book Get a Job, Build a Real Career and Defy a Bewildering Economy— the traits author Eric Weiner explored in his book The Geography of Genius: A Search for the World’s Most Creative Places from Ancient Athens to Silicon Valley.

I have often discussed the cultural capital and decentralized, dynamic models this great transformation favors, for example: Flexible Labor Is the Future (June 1, 2016)

In essence, we have a choice: 1) try to freeze history in its tracks, so those who are currently privileged remain privileged. This will slowly strangle the economy and increasingly concentrated gains in the hands of the few. Or 2) embrace disruption of the status quo as the only path to widespread prosperity and stability.

A Radically Beneficial World: Automation, Technology and Creating Jobs for All is now available as an Audible audio book.

My new book is #5 on Kindle short reads -> politics and social science: Why Our Status Quo Failed and Is Beyond Reform ($3.95 Kindle ebook, $8.95 print edition)For more, please visit the book’s website.

 

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One Chart Says It All

Sometimes one chart captures the fundamental reality of the economy: for example, this chart of money velocity and the civilian-population ratio. (thank you, Joseph Y. for posting it on my Facebook feed.)

When the blue line is up, more of the population has a job. (the blue line is the Employment-Population ratio.)

The red line is money velocity, the rate at which money changes hands. (Money buried in the coffee can in the back yard has a money velocity of zero.)

As Joseph noted, the correlation between the percentage of people working and money velocity was strong until 2010. In the post-2009 recession “recovery,” the percentage of the populace with jobs rose modestly, but money velocity absolutely cratered to unprecedented lows.

(The one other disconnect was triggered by the 1987 stock market crash, which caused money velocity to dip even as more people entered the workforce. This absence of correlation was relatively brief.)

The correlation between more people working and money velocity is commonsensical. More people working = more household income = more spending = higher money velocity.

But something changed in 2010. Did the quality and compensation of work change? Joseph observed: People started going back to work after the official recession ended in Q4 2009 but they were working for lower pay. With lower pay comes less disposable income, hence the cliff-like drop off in velocity.

Another potential factor is higher inflation. Some recent estimates (Where’s The Beef? ‘Lies, Damned Lies, And Statistics’) suggest the gap between official inflation and actual inflation in rent, food, energy and medical care in the past 20 years has subtracted 20% from paychecks.

The four “biggies” for the average American are rent, food, energy, and medical care, in approximately that order. These “four horsemen” have been galloping along at a faster rate than headline CPI. According to the BLS definition, they compose about 60% of the aggregate population’s consumption basket, but for struggling middle-class Americans, it’s closer to 80%. For the working poor, spending on these four categories can stretch to as much as 90% of total spending.

(If we add exposure to higher education’s soaring costs, the rate goes even higher.)

So even if wages held steady, once we factor in “real” inflation, real take-home pay has declined by 5% to 20%, depending on the household’s exposure to rent, food, energy, medical care (love those co-pays and out-of-pocket expenses) and higher education.

Another potential factor is the figurative coffee can in the back yard: people sense the ‘recovery” is bogus, and their rational response is to save more money rather than squander it. Even though central banks have reduced the yield on savings to less than zero, people are still saving whatever they can.

Data suggests it’s all three: lower incomes, higher inflation and a recognition that savings are more important in a ‘Lies, Damned Lies, And Statistics’ economy than more spending.

This chart says it all: real income is declining and the bottom 95% are poorer.No wonder people are socking away what they can and tightening their spending: they have no other choice, even as the Federal Reserve strip-mines their savings.

My new book is #3 on Kindle short reads -> politics and social science: Why Our Status Quo Failed and Is Beyond Reform ($3.95 Kindle ebook, $8.95 print edition)For more, please visit the book’s website.

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“Free” Trade, Jobs and Income Inequality: It’s Not As Easy As We Might Think

Globalization (a.k.a. “free” trade) has become an election issue for two reasons: many voters blame “free” trade with China and other nations for job losses in the U.S. and rising income inequality as globalization’s “winners” in the U.S. outpace its far more numerous “losers.”

A recent article in the New York Times looks at the issue from the perspective of recent economic studies: On Trade, Angry Voters Have a Point (via Lew G.)

The case for globalization based on the fact that it helps expand the economic pie by 3 percent becomes much weaker when it also changes the distribution of the slices by 50 percent.

Before we dig into this complicated set of interconnected macro-dynamics, let’s stipulate that there is no such thing as “free” trade. Every trade agreement defines winners and losers by the very design of the agreement.

Also, other issues that are outside the confines of the actual trade agreement can have outsized influence on trade’s winners and losers.

For example, trade between the U.S. and China cannot possibly be “free” because China pegs its currency to the U.S. dollar (USD). This peg enables China to arbitrarily keep its products cheaper than they might be if the market set the value of China’s yuan.

We must also keep in mind that the owner of the reserve currency, the U.S., must export its currency in size, i.e. run a permanent and substantial trade deficit. I’ve explained Triffin’s Paradox many times; please read (or re-read) these essays if you want to understand why trade deficits are integral to the reserve currency and are not a feature of any particular trade agreement:

Understanding the “Exorbitant Privilege” of the U.S. Dollar (November 19, 2012)

The Federal Reserve, Interest Rates and Triffin’s Paradox (November 19, 2015)

Many overlook the fact that central bank interventions play an enormous role in establishing globalization’s winners and losers. By lowering interest rates to zero (or less than zero) and flooding the banking sector with credit/liquidity, central banks encouraged an explosion of global carry trades, in which financiers borrow cheap in one currency to buy high-yielding assets in another currency/nation.

The central-bank fueled explosion in credit also threw gasoline on speculative investments in emerging market nations, distorting currencies, markets and trade. The point here is that globalization, financialization and central bank interventions are tightly bound together. We cannot talk about any of these drivers in isolation; together, they form one system we loosely call “global trade.”

Let’s move on to globalization’s impact on jobs, income and income disparity.The article linked above notes that one study found trade with China erased 2.4 million jobs in the U.S. Other studies have found an offsetting consequence: the purchasing power of middle-class and working class households rose by 26% due to globalization’s relentless reductions in the cost of imported goods.

We must take all such estimates with a grain of salt, as there are many dynamics in play. The U.S. economy has been roiled by deep structural changes since the late 1960s; there has been no let-up in systemic turbulence: the end of the Bretton Woods stability in foreign exchange markets; the rise of Japanese and Asian imports in the 1970s and 80s; oil shocks and stagflation in the 1970s; the cost of dealing with industrial pollution of our air, water and soil; the tech boom–the cost of processors and memory have fallen while advances in software and robotics accelerate; the explosive changes wrought by the Internet; the rise of China and the Asian Tigers as the world’s low-cost workshop, and various speculative debt/fraud bubbles that burst with catastrophic consequences for participants and non-players alike.

At the risk of overloading you with data, let’s look at a few key charts and mark the rise of China’s influence, the rise of financialization and income inequality and the explosive rise in U.S. corporate profits.

Here are the charts we’ll be reviewing:

— Civilian employment-population ratio (the percentage of the population who are employed in some fashion, including self-employed and part-time)

— Productivity (and income disparity)

— Income inequality

— U.S. Financial profits

— U.S. Corporate profits

On the face of it, the U.S. experienced a multi-decade boom in employment from the early 1980s to 2008. Many have noted that the key demographic driver of this rise in employment was the mass entry of women into the work force. Many believe the loss of purchasing power in the stagflationary 1970s pushed women into the work force as the only means of maintaining household buying power. There were other drivers, of course; nothing this structural reduces down to one single cause.

This chart looks like a giant head-and-shoulders pattern that correlates with the rise and fall of financialization, which is the commodification of previously safe assets such as housing and the explosive rise in debt, derivatives and financial gaming (which quickly morphs into fraud if regulatory agencies fall asleep at the wheel).

It’s difficult to separate China’s rise and the bursting of the tech bubble, as both occurred in the same time frame; undoubtedly both negatively impacted employment.

The disconnect between productivity and wages really took off with the rise of financialization and cheap technology tools in the early 1980s. This is not coincidental, and can’t be pinned on globalization or trade with China, which occurred much later.

As we see in this chart of income inequality, the top 10% (the “winners” in financialization and tech) had already pulled away from the bottom 90% when China entered the WTO in 2001. Clearly, the disparity began before China’s trade was large enough to impact the U.S. economy; the dramatic increase in trade with China post-2001 had little impact on the disparity between the top 10% and the bottom 90%.

This chart of financial profits and debt/GDP shows the dramatic expansion of debt from the early 1980s and the explosive rise in financial profits as interest rates were pushed to zero and the debt/housing bubble #2 took off.

Could globalization have been a factor in this monumental expansion of financial profits? As noted above, it’s clear that the globalization of finance–carry trades, the expansion of financial markets in emerging nations–gave U.S. financiers, corporations and banks an enormously expanded field for skimming fees and profits via debt, derivatives and speculation.

Total U.S. corporate profits soared once trade with China and the financial free-for-all of housing/debt/fraud took off. This chart makes it clear that the winners from 2001 on were financiers and corporations exploiting two dynamics: offshoring production to China and maintaining product costs to reap outsized profits, and borrowing cheap money to expand overseas and skim profits from carry trades.

What do we get if we add these charts up?

1. Offshoring of production jobs to China et al. undoubtedly slashed jobs for the bottom 90%, but these losses were offset (or masked) by the rise of housing/debt/fraud bubbles that boosted employment in the FIRE sector (finance, insurance, real estate).

2. Financialization and central bank intervention greatly rewarded those with the skills and sociopathologies needed to participate in the resulting debt/fraud booms.

3. U.S. corporations reaped the gains from offshoring jobs, and these gains flowed to top management and those who own corporate shares, i.e. the top 5%.

4. The trend of rising income disparity started long before China’s trade was significant enough to impact the U.S. economy, and correlates with the rise of financialization and cheaper technology tools.

5. These trends rewarded management, finance and technology expertise, which are concentrated in the top 10% of the work force.

6. Cheap imports, offshoring of production and the global expansion of financial markets have driven U.S. corporate and financial profits to unprecedented heights. Since these profits largely flow to top management, financiers, technocrats and owners of corporate capital–roughly speaking the top 10% or even top 5%–it’s no wonder wealth and income disparity is rising: there is no other output possible in the current system.

Slapping fees on imports (which by the way is illegal in treaties such as the WTO) will not solve the larger problems of reduced employment, stagnant wages and rising income inequality. To make a dent in those issues, we’ll need to tackle central bank and central-state policies that have pushed finance and speculative churn to supremacy over the productive economy.


We need a new system, one we control from the ground up:
A Radically Beneficial World: Automation, Technology and Creating Jobs
for All
. The Kindle edition is $8.95 and the print edition is $20.82.

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How to Escape the Purgatory of Minimum Wage/Part-Time Jobs

Readers responded positively to my recent essay on the emerging economy and jobs: A Teachable Moment: to the Young Person Who Complained About Her Job/Pay at Yelp and Was Promptly Fired

Many young people are stuck in the purgatory of minimum wage and/or part-time jobs: that raises the question: how do you get out of minimum-wage purgatory?

The conventional answer is, “get another college degree.” Perhaps this once had some value, but this now yields rapidly diminishing returns due to supply and demand: everyone else seeking an escape from low-wage/part-time purgatory is pursuing the same strategy, so there is an oversupply of over-credentialed job seekers.

As I point out in my book on jobs and careers in the new economy, Get a Job, Build a Real Career and Defy a Bewildering Economy, issuing 500,000 MBAs does not automatically create jobs for all those graduates: credentials don’t create jobs.

What creates jobs are opportunities to earn high profits via developing profitable skills. Not all businesses are highly profitable; low-margin businesses don’t make enough profit to pay high wages.

Take a high-skill person and put them in a low-margin setting such as fast-food prep (very fast-paced and hard work), and their labor can only generate a limited value for the employer.

Value and profits flow to what’s scarce. Low-skill labor is not scarce–it’s abundant, hence the low wages paid for low-skill work. Workers with credentials are no longer scarce, with the exception of physicians and nurses and a few categories of advanced degrees such as computer science.

What’s scarce are opportunities to earn big profits. Those who have never started a business or operated a business always assume a busy restaurant (for example) is very profitable–but this is not necessarily true. A restaurant with high rent, high labor costs and high overhead expenses could be losing money even if it’s filled with customers every night.

Not only is it not easy to earn a profit, it’s getting harder by the day. Rents are soaring, permits and fees are soaring, regulationary compliance costs more, taxes are higher, minimum wages are rising and competition in most sectors that aren’t protected by the government is fierce.

Employees have to generate a substantial profit for their employers, or the employer will go under. Even large corporations that report big profits are slashing payrolls, trimming bonuses and benefits, and demanding more free labor (though they don’t call it that) from remaining employees. Executives who fail to top profit estimates are sacked.

What’s scarce and what’s abundant? Answering these questions helps us understand the economy and why high wages and profits flow to what’s scarce.

If there’s only one grocery store in town, access to fresh food is scarce, and that store can charge a premium. If there is only one plumber in town, the plumber can charge a premium equal to the travel time that would have to be paid to plumbers in other towns.

In the age of automation, what’s scarce are problem-solving skills. Software and robotics are good with set situations and routines, but not so good at responding to unique situations. If someone wants a high-wage job in a profitable sector, one avenue is to become a better problem-solver.

The best way to become a better problem solver is to start a small enterprise yourself, because the entrepreneur–even the smallest scale entrepreneur selling on Etsy or perfominng some service in the community–must solve a wide range of problems on a daily basis.

Another way is to volunteer for organizations that are woefully understaffed. A beginner will be given responsibilities in these settings that would never be given to him/her in a government or corporate setting.

The more you take on, the faster you learn because you fail often and fail fast. Problem-solving is largely intuitive and a function of experience and networking with those who can help solve the problem.

This is the basis of the eight essential skills I recommend everyone acquire if they want to exit low-wage purgatory.

A third way is to actively acquire knowledge and experience in fields that are not within your chosen speciality. Specialization is not necessarily the best or only way to develop scarce skills; being able to cross boundaries and draw insights from other fields– the opposite of further specialization–makes for better problem-solving skills. Flexibility, adaptability and the ability to bypass rigid boundaries–these are scarce.

Nowadays, virtually every field requires good communication and collaboration skills. Credentials don’t generate these skills–experience is required. Many people complain that they can’t get the experience needed to qualify for a job, so they puff up their resume/CV and lie about their experience.

The better strategy is to get the experience and consciously set out to acquire solid communication and collaboration skills–what’s known as “soft skills” as compared to “hard skills” such as welding or coding Python.

As noted above, there are two avenues: volunteer for an organization you believe in that happens to be woefully understaffed, or start your own enterprise, no matter how small.

What’s scarce and what’s abundant? The answers are not always clear, but the process of seeking answers will be helpful. Finding work you enjoy and developing skills that are scarce–this is the way forward.

There is more on these topics in my book Get a Job.

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There’s No Upside Left

There’s no upside left–not just in the real economy, but in jobs, politics or policy tweaks. Yes, there will be huge relief rallies in the stock market–relief that the Fed is still omnipotent, that the Fed didn’t destroy the world by withdrawing liquidity, etc., etc., etc.–but in terms of sales and profits, there’s no upside left: an increasingly nervous upper middle class is reining in profligate spending, while everyone below the top 10% is running out of credit cards, student loans, etc. to tap.

Whatever surplus the real economy generated has been skimmed by financiers, lenders and the central state.

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The Flaws in Basic Income for Everyone

Finland made the news recently by proposing a pilot program of guaranteed income for all, also known as Universal Basic Income: Desperate Finland Set To Unleash Helicopter Money Drop To All Citizens.

The goal is two-fold: by providing every household with a minimum income, regardless of what other income the individuals might earn, the program does two things: it provides everyone enough money to get by and it removes the disincentive to work inherent in the conventional welfare model: in the current model, recipients who earn money lose their benefits, leaving them no better off if their earnings are modest.

The Finnish proposal offers a basic income of around $850 to $900 per month, roughly $10,000 per year.

Proponents of Universal Basic Income (UBI) see it as the only solution to automation’s replacement of human labor, a topic I discuss in depth in my new book A Radically Beneficial World: Automation, Technology and Creating Jobs for All.

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What Happens to our Economy as Millions of People Lose the Habits of Hard Work?

Simply put, job growth is not keeping pace with population growth–specifically, the growth of the labor force which is generally defined as the population between the ages of 18 and 64.

So what happens to the economy as millions of people never acquire the habits of hard work or lose them due to chronic joblessness?

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Acquire Skills, Not Credentials

My recent conversation with Max Keiser on Summer Solutions (25:45) included three bits of advice:

1. Stop financializing the human experience

2. Acquire skills, not credentials

3. Vote with your feet

Today’s topic is acquire skills, not credentials.

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