Minnesota’s Border Battles: COVID-19 edition
Last year, we released a report titled ‘Minnesota’s Border Battles‘ in which we compared the economic outcomes in Minnesota counties bordering other states with the outcomes in the border counties…
If you’ve been to the stores recently you might not have found TP or, this last weekend, pasta. But one thing you will have found are the staff. At a time when the coronavirus has many people are either working from home or just staying home, these folks have kept stacking and scanning.
This highlights an important point. Often, when economists talk about ‘low-skilled’ workers people get offended. They think – or pretend to think – that you are saying that these people or the work they do isn’t important in some way. But that isn’t the case. ‘Low-skilled’ and ‘important’ are not mutually exclusive terms. ‘Low-skilled’ does not mean that a person works less hard or doesn’t have a big impact on the consumer. It is simply reflects the fact that such jobs require little to no training.
Accumulating the skills necessary to be a neurosurgeon requires an extended period of intensive medical education and training. Accumulating the skills necessary to be a bus driver requires a period learning to drive a bus and getting the license. ‘Low-skilled’ jobs, by contrast, don’t require this, which is why many ‘low-skilled’ workers are young: they haven’t had the time to accumulate skills. Speaking personally, my first jobs was working in the kitchen at a branch of a famous fast food pizza chain. When I started, my training amounted to about two hours.
A couple of important conclusions flow from this.
First, it is much easier to find a ‘low-skilled’ worker than it is to find a more highly skilled worker, like a neurosurgeon or bus driver.
Second, because of the relatively low levels of skill involved, low-skilled workers are usually easier to replace with machines. As the costs of machines fall and low-skilled labor rise, this ‘substitution effect’ will be seen more often. Plenty of people at the stores have been using self-checkout machines.
Economics involves thinking logically about human action. For many, this looks cold-blooded, and they insist in seeing a moral judgement behind phrases like ‘low-skilled’. But just as ‘low-income’ actually means ‘low-income’ and isn’t secret code for something else, ‘low-skilled’ conveys no moral judgement on those workers. As recent events show, they can still be very important.
John Phelan is an economist at the Center of the American Experiment.