The Myth About Less-Skilled Millennials

I saw an article today that really pissed me off. It commits two sins I see constantly in modern journalism, namely it panders to its audience (in this case, baby boomers) without referencing any facts directly, and it ignores easily Googled facts that directly disprove its point. It's not that it addresses the facts and argues that they aren't important, I mean it just flat out ignores them. Instead, it references someone else's study without using any of the facts or figures the study used to make its conclusions. Moreover, it was printed in the Economics section of the Wall Street Journal. I expect a certain lack of facts or research in less respected news organizations, but the Wall Street Journal and The New York Times are supposed to be better than that. This article lets down the paper badly.

Well, enough preface, here's the link: http://blogs.wsj.com/economics/2016/02/29/how-a-less-skilled-american-workforce-may-be-holding-back-growth/ . You can see by its very title what its editorial viewpoint is, that the workforce is getting less skilled and that's what's wrong with the economy. Here's what really bothered me, it states that: "Well-educated baby boomers are retiring, and many laid-off older Americans who want to work have struggled to find jobs following the recession, bringing the overall experience level of the workforce down. College enrollment is on the decline after peaking in 2011, as the economic expansion creates job opportunities for less-skilled workers." The implication here is clear, workers not in the baby boom generation are less skilled. If it were just a question of experience, this wouldn't be an interesting statement at all. Obviously retirees are more experienced than those of working age, they're older. No matter what time in history we look at, this should be a true statement. The older are always more experienced by sheer dint of living longer and having had more experiences. This is so blisteringly obvious a statement that I refuse to believe that's the point of the article. The actual editorial perspective of the article is made clearer by the college enrollment statement. By saying baby boomers are well-educated and college enrollment is in decline, it’s using two, at least arguably, true statements to imply something that isn't true. Namely, that younger generations are poorly educated. Here's a Wikipedia graph on educational attainment over time: https://en.wikipedia.org/wiki/Educational_attainment_in_the_United_States#/media/File:Educational_Attainment_in_the_United_States_2009.png . The percentage of people 25 and older with a college degree has increased fairly steadily for the last 70 years. The article concludes by saying: "...there (i)s one obvious policy solution: more skills and more education." Well, we know that educational attainment has been increasing, so either we have a skills mismatch that the current educational system isn't meeting (so more education won’t cure the problem), or there are simply not enough jobs for skilled college educated workers. But implying that younger workers are poorly educated and unskilled is just pandering to the prejudices of older generations and not supported by basic facts.

And now we get to the crux of our economic doldrums. Even if we choose to ignore a global economic slowdown, wars across the middle east that have ravaged regional economies and trade partners, or the huge asset bubbles created by central banks desperately expanding the monetary supply in an attempt to cover for bad government policies that harm economic growth; the problem isn't that the fundamental makeup of the workforce is changing, it’s that the so called "recovery" is only creating low skilled, low paying, temporary jobs. The article even admits that in the above quote. College enrollment doesn't change where the demand for labor comes from, except possibly in higher education. In all likelihood, if we see continued declines in college education, it will be because employers have stopped valuing college degrees. Or, at least, that employers don't value them enough to pay a high enough wage to make the investment in a four year degree worth it. So let's stop bemoaning the bursting of the education bubble and let’s stop blaming a retiring baby boomer generation for a loss in workforce participation and productivity. Let's instead put blame where it is due. Namely, lets blame bad government policies that have created perverse incentives for companies to move as many jobs as humanly possible out of the first world. Policies that mean the only jobs created are low level service jobs that can't easily be outsourced overseas.

So what's the solution? First, we need to re-examine the benefits of free trade treaties with second and third world countries. If a country has a large net loss of jobs as a result of a trade deal, and can only point to cheaper goods and profits shared between corporate insiders and global investors, then the deal is a failure. A population of unemployed and underemployed workers can't afford to spend big on consumer goods, they rely much more heavily on welfare programs, and their lost taxable wages takes away the tax revenues governments need to pay welfare benefits. Cheap consumer goods mean nothing when a family is struggling to pay the bills and feed itself. Secondly, we need to rewrite the tax code so that big multinationals are paying at least as much in taxes on local revenue as the local start-ups that try to compete with them. The small business used to be the biggest employer of labor in the USA. But with a tax code that hamstrings them, small businesses have been failing and employing less people. Lastly, we need to intervene and cut the red tape that prevents small businesses from being created. This needs to be done at a local level, and solutions to these problems will necessarily be unique to each region.

And on a final note, I expect better of the Wall Street Journal. Don't just quote someone else's study to libel younger workers. Do some investigative reporting. Test the numbers in the study against other data sets to see if their conclusions make any sense. Moreover, when the world is at war, foreign economies are crumbling, and the Euro zone falling apart, blaming a dip in college enrollment and the retirement of baby boomers for our economic stagnation is just asinine. It's a symptom of much greater problems in the world, and ignoring those problems just makes it easier for lazy governments to do nothing about them. Lastly, stop blaming millennials for problems created by the policy decisions of the "greatest" generation and "baby boomers". No one should get a free pass for their poor leadership and economic stewardship.