I have an undergraduate degree in economics and an MBA. When I took my first macroeconomics class, and heard about the models of the economy they were using, I was appalled.
I stood up and said something like this:
“I understand that you need to simplify to model something as complex as the economy, but the assumptions this model is built on are so absurd as to be worse than useless. Utility curve? Rational consumers? Rational business? Why not come up with assumptions that better reflect reality? Yeah, simplify but approximate reality.”
They didn’t then and they don’t now. Except for those experimental economists who everyone else in the field simply ignores. As far as I can tell, the Chicago School — the neoliberal school of economics — has the floor and continues to spout nonsense.
This is nowhere more apparent then in explanations of the Great Resignation. Rationalizations abound. If you actually wanted to know why people are resigning, you might try asking them. Enough of them to have a meaningful and statistically significant sample.
Nope. Let the economists explain.
In today’s Washington Post, there’s an article: “A record 4.4 million Americans quit their jobs in September as labor market tumult continued.”
Economists explain everything.
- Delta variation “Workers are fed up with working conditions and feel unsafe and quitting even though they might not immediately jump into a new job.”
- Companies are panicking and desperate to hire. But they aren’t hiring! There’s plenty of unfilled jobs! Oh, this is just “mismatch” — they can’t find qualified workers.
- Of course, some people are quitting because they can get better paying jobs in this (allegedly) favorably job market. But why aren’t they just taking new jobs? Why are they quitting without new jobs? That clearly makes no sense.
Those of us who aren’t living in ivory towers or the lives of Wall Street economists have other explanations. While the reasons given by the so-called experts are true in some cases, this is a BIG number of unexpected resignations. And resigning when you have no other way to earn a living is a desperate move.
This is something that people who live on Earth and not in some theoretical fantasy land all know.
The best explanation for what happened, and continues to happen is this:
During COVID, a fair number of people resigned for whatever reason — reassessing their lives, anger, fear, whatever. Because millions and millions of people hate their jobs for good reasons, and they saw others were quitting, millions more went with their feelings and quit, too. More follow every month.
As working people know, especially those working for large corporations, employers are clueless, cheap and cruel. Wages are depressed, Benefits, where they exist, shrink or disappear. Managers are clueless and interfering and abusive.
Humorously, “experts” are recommending that employers raise wages and pretend to be nice to workers. Like this is some kind of revelation. Of course, this is clueless, like a wife beater who always reverts to abuse, but tries pleading for his wife to come back. It’ll be different this time.
Early indications are this isn’t fooling anyone.
I believe the truth is this:
The forces behind ongoing downsizing, automation, shipping jobs over seas, destroying unions and depressing wages and suppressing government benefits to struggling Americans has taken the American worker to the breaking point. People have been abused so much for so long they feel they have nothing to lose. What happens if they stay on the job? Will they ever be able to put away enough money to retire? No. Will they every have job security? No. They could be fired tomorrow. In fact, companies are doing everything in their power to lower labor costs.
I don’t know what will happen. But I don’t expect this to just blow over. Scams can work for a long time, but not forever. Maybe the entire rotten system itself will collapse. Couldn’t come a moment too soon.
