No Worker Left Behind?
It appears that the concept of “no worker left behind” is a mythical term, at least according to a recent article in the New York Times. This article discussed what is happening to the American labor force, and here are some interesting statistics from that article:
- In 1954, around 96 percent of American men between the ages of 25 and 54 were in the workforce.
- Today, only 80 percent of American men in the same age group are in the workforce.
- One-fifth of all American men in their prime working years are not even in the workforce today.
- The U.S. has a lower percent of prime age men in their workforce than any other G-7 nation.
Please note that this does not include those who are in the workforce, but are currently unemployed. The numbers above are only for those men who cannot work, or do not want to work…they are out of the workforce entirely.
So, why are so many American men dropping out of the workforce? What has happened to the concept of “no worker left behind” on the national level? Here are some additional statistics that may shed some light on the reasons:
- Ten years ago there were 5 million Americans receiving Disability payments, primarily from federal funds.
- Today, there are 8.5 million Americans on disability—and the number is growing like wildfire. Today’s annual cost to U.S. taxpayers is $115 Billion, or around $1,500 per household.
- There are now more non-working men in the U.S. than at any time since the “Great Depression.”
All of these statistics are interesting in view of a post I wrote last week—Places That Are Hiring—about how large tech firms cannot find qualified people to work for them, and so they are buying up their smaller brethren just to acquire the talent.
In addition, it seems that many companies are not outsourcing work for monetary gain, they outsource because they can’t get the work done in the U.S. They move their business to where the qualified labor force is located. What a sad commentary on the quality and capabilities of America’s workforce.
America is losing its vigor. People in the U.S. today no longer exhibit the energy that made us great. Worse yet, no amount of stimulus money from the government is going to help—in fact our government has become so obsessed with programs that provide “comfort,” they have ignored programs to reinvigorate our country.
Capital is unavailable to small businesses, regulations are crushing, incentives are non-existent, there are no effective training programs that help people develop the skills they need to enter the workforce, and on, and on…and no one in Washington seems to care. All we hear today are rants on Social Security, Medicare, and war. What happened to the concepts of “no worker left behind” and “full employment?”
Isn’t it about time we looked at the big picture and tried to figure out how best to reinvigorate America, so we can provide good paying jobs for well-trained people in our workforce, and help that workforce grow back to be the best in the world—again. With more successful businesses, there would be more taxes paid, and we could stop the “slash and burn” approach to trying to balance budgets.
Never doubt that a small group of thoughtful, committed citizens can change the world. Indeed, it is the only thing that ever has. —Margaret Mead
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Places That Are Hiring
I keep reading where there are many places that are hiring, but they are faced with a shortage of candidates. Then I saw on the morning news today where 53 percent of college graduates over the past 4 years had not found full employment. Hmmm.
To really confuse the issue, I then read an article explaining that large tech companies are buying up newly started small tech companies–just to acquire their employees. Obviously, large tech companies are some of the places that are hiring.
However, it seems that competent talent is so scarce that companies like Google, Zynga, Facebook, and the like, are buying startup companies and killing their products while enfolding the founders and engineers into the acquiring company.
An executive from Facebook recently said; “Engineers are usually worth from a half to one million dollars each when buying a startup company.”
It appears that Facebook has acquired some 20 startup companies just to get the design and development talent of the startups. It is reported that Facebook bought FriendFeed for about $47 million, or about $4 million per employee. Although FriendFeed is still alive, it languishes in the shadows, with little or no attention being given to it. Facebook only wanted the talent that came with the business.
So, here is what I make of this apparent contradiction between unemployed college graduates and places that are hiring:
- There is really only one game in town, and that is high tech.
- If an engineer or developer wants to get noticed by a tech firm, they should start up a business and get some media coverage.
- Colleges are turning out graduates that are not in demand in the real world.
- High paying jobs for young college grads in America are all in industries that do not make anything, other than stock market value.
- I see nothing on the horizon that will improve the lot of most of the non-tech grads looking for a career-starting job.
Obviously, the disparity between a surplus of college graduates and the places that are hiring is incredible. Why might that be?
You don’t suppose that college students today are simply following the programs that require only a minimum of effort to graduate–while giving little thought to what they will do in the real world?
What do you think?
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Exit Strategy–Forget It!
An exit strategy is of interest only to a very small percentage of the over 6 million new businesses that will start up this year. Yet, there are millions of words written, videoed, and recorded extolling the necessity of having an exit strategy in a startup’s business plan.
A new business should be concentrating on making a successful start—not on how to best “exit” their business. Here is what Mark Cuban, billionaire startup entrepreneur and Venture Capitalist, has to say about the first two most important rules of starting a business:
- “Don’t start a company unless it is an obsession and something you love.”
- “If you have an exit strategy, it’s not an obsession.” –Mark Cuban
The main point here is that when a person is starting a business they must not only be passionate (obsessive?) about their business, but they must stay focused on getting their business started–not ending.
In most cases, an exit strategy will form “automatically” as the business grows and begins to mature. Here is how this will usually happen:
- The vast majority of new businesses that start up each year will fail. This is a hard statistic to swallow, but unfortunately, it is true whether an exit strategy exists or not.
- Many of the surviving businesses will grow and be approached by someone inviting them to consider merger or acquisition. No exit “strategy” is involved here, but it might be decision time.
- Some of the surviving businesses will be successful and the owner/founder will tire of the business and put it on the market for sale—never planning this as a specific exit strategy when they started their business.
- In a few cases, as a business grows and matures, a founder/owner may decide to retire and simply close their business. This is a deliberate decision, but usually not part of an exit strategy plan when they start their business.
- In some instances, a business may take off and grow beyond all expectations, forcing the owner(s)/founder(s) to develop an exit strategy that might even include an IPO.
The one exception to the above “automatic” exits is the company that wants to pursue Venture Capital. Venture capitalists will want the business owner(s) to provide a projected exit strategy showing an incredible return on money invested, before they will even consider investing in the business.
Actually, Venture Capital involves a very small number (less than one-half of one percent) of the over 6.5 million businesses that will start up every year.
Incidentally, the same holds true for Business Plans. If you want to read why business plans are useless, check out this post.
Well, what does everyone think about this concept? Agree? Disagree? Let me know.
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