The Big (Employment) Squeeze

The Big (Employment) Squeeze

It’s funny how information tends to come in waves.  Recently, I came across two articles that had similar themes about different victims.  The first was the notion that engineers that are over 35 are essentially unemployable.  The opinion piece from CNN discusses how “older” workers are perceived as too expensive to hire.  It also discusses how the point of mass layoffs is to eliminate the older, more expensive workers and foist more work on less people.  Fluxor has discussed the reality of this situation in many of his posts.

Shortly before this article came out, another one showed up on Bloomberg.  This one had the age of unemployability as 40, but around the same ballpark.

All of this has been discussed often on EngineerBlogs.  However, what brought this to mind was an article I came across a few weeks ago.  This one talked about the other end of the employment spectrum.  It’s also something I’ve seen discussed in my classes when I’ve had a speaker from the career center.  This article posited that entry level jobs are no longer entry level.  This is exactly what I’ve been hearing from the career counselors: if you want a job after college, you need to have 2 or 3 internships while you’re in college.  No one will hire you until you’ve already had engineering experience.

My take away from all this is that employers are becoming increasingly picky about what they want in an employee, and they certainly aren’t willing to train.  One is supposed to invest four years (or more) into their education, work several internships (hopefully none of which will be unpaid, but that is becoming the norm in many other fields), and can only count on having that job for about a decade to maybe two before they may have to switch fields entirely.  Granted, that 10-15 years may provide valuable experience, but is it worth it given the cost of college and the fact that one may have to retrain to enter another field that may be more stable?


Have you ever seen an article talk about an impending wave of retirees in a certain field, or a skills-shortage?

Let me translate it for you:
“We the employers want to pay our employees less” (because we have temporarily run out of ways for them to produce more at the same cost)

It’s as simple as that. We’re a long way into a trend of offloading risks and ultimately costs. The costs do not disappear, but it does take time for the results to feedback into the decision making. It’s a matter of waiting for some shock or noise to be injected into a then fragile system.

Yep, I’ve seen those same articles about engineers being too old after 35. It’s a bunch of hogwash pushed by greedy employers. Meanwhile I suppose you’ve noticed the push for more STEM students and graduates. And by looking at job postings I see a lot of Senior Engineers wanted (mainly due to companies not cultivating talent over the years). So what’s the real story? Businesses still need engineering talent, but they focus cost cutting on engineering despite shooting themselves in the foot. That’s because they are not engineers and overvalue their own contributions to the company.

As far as employers being too picky (will not hire without experience, even at entry level), you’re correct but this is an old problem. New graduates have faced impractical “minimum experience required” obstacles for decades. It just seems that only recently anybody outside engineering has paid any attention – and that attention is mainly by politicians who have realized it is another platform. Both of our leading Presidential candidates talk about it, but neither is offering any ideas or promises that will directly help engineering careers.

“…can only count on having that job for about a decade to maybe two before they may have to switch fields entirely”. Very true. This is why engineering school enrollment and graduation has been shrinking for the past two decades. Business cries about a lack of competent talent, but without jobs that talent is forced to change careers. Now businesses cannot replace senior engineers (that they rely heavily upon) because so few qualified candidates remain. Expect to see a lot more foreign engineer recruiting since business has thrown away a whole generation of native talent.

Enter, “The Revenge of the Nerds.”

The missing aspect of this piece has to do with the prevalence of contract engineers over the past decade. For example, I am currently working as a contract engineer for a large Ag company making what I consider to be an obscene amount of money. As employers have become more and more irrational about hiring, more and more young people are recognizing the value of taking their careers outside of traditional corporate structures. All the best metallurgists I know, for example, work as contractors or consultants now. Staff Aug may very well be the “way of the future” and may end up supplying all those missing Senior Engineers.

My partner and I run a fair size consulting firm. We have a variety of clients in a pretty varied and unrelated set of industries. Most of our clients are in commercial tech but not all. My observations, which may not be the same as everyone else… our clients typically are looking for our engineers to be very senior. As such, our firm typically seeks out folks with at least 10+ years experience with a preference towards 15+. We pay our folks competitively (I have a pretty good handle what our major clients pay their senior folks). Here is a strange observation. We typically work on a project basis (i.e. we are not a temp agency). Funny thing is our clients are short handed and they tend to use us for the risk (but cool) projects for new and different things. Their internal staff, tends to work on inline type products. Not to minimize but I seem to see our clients engineers working on value engineering while we do the cool and innovative stuff. So, we my firm may be outside the norm but, in the consulting world, people are paying for experts (and a premium for this) while bringing the younger, less skilled talent inside. Weird.

Today the goal of full employment is important for a very simple reason. The faster we return to full employment, the faster we can pay down our debt and the faster we can put the ‘something for something’ back into social security.

Comments are closed.