Workers Immobilized By Mortgages, Not Skills

Workers have a hard time finding jobs due to structural resets in the economy, but lack of skills is not part of the equation this time:

Some observers lately have blamed the problem on structural factors — there’s a mismatch, they say, between the types of jobs available in a given location, and the types of skills that workers have. That’s a problem that only long-term retraining efforts can likely fix.

The article starts to hint at the correct diagnosis, but then drops it to jump on a pro-union bandwagon.  That’s a disingenuous revelation of bias, made all the more evident by later references to pro-union policies in other countries.  The problem in America is locational mismatches between available jobs and available skills, not lack of union bargaining power.

American workers are among the most highly skilled in the world.  Labor mobility makes our workforce flexible, but that’s hindered when workers are tied to heavily-mortgaged homes that they can’t leave without suffering major losses.  The subprime lending debacle is still hurting workers’ chances to move to where they can fill appropriate jobs.  That is not something that labor unions can fix through collective bargaining or more legal rights.

The solution is to let foreclosures run their course.  Workers who no longer have an economic incentive to stay in a distressed neighborhood can move to find new work.

About Anthony Alfidi 128 Articles

Affiliation: Alfidi Capital LLC

Anthony Alfidi is the Founder and CEO of Alfidi Capital. His firm publishes free investment research with honesty and humor.

Mr. Alfidi holds a Bachelor's degree in human resource management from the University of Notre Dame (cum laude) and an MBA in finance from the University of San Francisco. He is a life member of Beta Gamma Sigma, the academic honor society for business majors. He has been a private investor since the 1990s.

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