Labour market mismatch and immigration

If you want to know why immigration is so high, today's labour market figures (pdf) give you one reason.
They show that unemployment and vacancies have both increased in the last two years. This is evidence of increasing mismatch in the labour market. The skills employers want are, increasingly, not the same as the skills workers are offering. The upshot is that jobs lie vacant whilst workers stay unemployed. And the gap gets filled by migrant workers.
In this sense, Brown's slogan "British jobs for British workers" is not just morally obscene, but economically moronic too.
In a dynamic market economy, jobs are continuously destroyed and created; today's figures remind us that in a typical month, almost one-in-four of the unemployed leave the claimant count, with another one-in-four joining it. These changes will inevitably result in differences between what employers want and what workers offer. Sometimes these differences will be small. Sometimes (as now) they'll be high.
To claim that the government can somehow ensure British jobs for British workers is to suppose that government can somehow anticipate these mismatches. That's just not possible.

Comments

[Max]

The government does hammer on about the need for skills training and is certainly putting some money into it. It's pushing vocational, skills-based training.

[chris]

True - but this isn't a short-term solution. And it might not be a long-term one either. The skills we need today might not be the ones we need in (say) five years' time. And the more vocational and job-specific the training is, the greater the danger of obsolescence. One virtue of general education is that it gives people more ability to adapt to a changing labour market.

[Matthew Sinclair]

You're assuming the mismatch is workplace skills. "Social breakdown" in all its many and varied forms could explain it just as well. Talk to a teacher at a struggling school and it becomes clear that it isn't workplace skills many of their pupils lack but basic social and mental skills.

Those are hard to influence but not impossible and the challenge is not created by difficulties with prediction.

[jameshigham]

It's not the concept that is bad - it's the obscene man who made the comment.

[Bishop Hill]

I would have thought the figures could equally have been explained by an increase in people choosing to work in the black market as well as claiming the dole.

[Glenn]

Chris - these trends have been going on for years. In the UK, the residual workless or unemployed people are not 'job ready' - they are less competitive in the labour market next to an immigrant that has high levels of employability. The skills needed in question tend to be soft skills - dealing with people, phones, deadlines etc. Years of government sponsored work and the books such as State of Working Britain I and II have amply pointed that out.

Those left long-term unemployed now tend to be the most difficult to help back into employment, and by that turn, the most expensive. Should we keep trying? Personally, I think so - not least for social cohesion and to mitigate against an anti-immigrant sentiment in some communities.

You've done well to remind us that the labour market is a series of flows though, and that the static viewpoint is problematic in so many ways.

[dissent]

In the U.S. I.T. job market, employers advertise positions and screen out more qualified Americans and hire cheaper foreigners on H1-B visas. There was an amusing video that was leaked from a info session by a law firm that specializes in these manipulations for corporate clients. The video showed this precisely.

I am skeptical of hiring foreigners for domestic job slots, unless the shortage of suitable employees meets strict and monitored tests.

I lived in San Francisco during the tech boom and observed that during a severe worker shortage, employers became willing to hire and train those they hadn't been willing to hire before. The community benefited.

There is also this moralistic refrain trotted out that native born workers are inferior due to "social breakdown". I think the MAJOR factor in such breakdowns is the lack of reasonably secure and remunerative employment. In the USA, marriage and family is increasingly becoming not a middle class, but an upper middle class, attribute. People just don't have the economic stability for family formation.

[Luis Enrique]

What other explanations are there for a simultaneous rise in vacancies and unemployment, besides a friction caused by deteriorating matches between demanded and supplied skills?