Wednesday, December 4, 2013

From the Ground Up - Building Skills Arbitrage

It looks like a lot of economists are going to lose a battle of logic this time: the one over minimum wage hikes, that is (for instance Kevin Erdmann presents a compelling argument re historical labor shocks). Unfortunately it's not hard to decipher why voices of reason continue to fade, yet again. After all, the supply side of the economy has scarcely budged in terms of what it offers for all incomes, or allows people to actually participate in. Aggregate supply and aggregate demand are indeed entangled. And even though they may not show up in unemployment statistics, wage hikes still mean that many individuals end up abandoning job markets too soon. Communities need to try harder, to bring job markets to those who still very much need them.

Even though aggregate demand was partially supported after the onset of the Great Recession, the fact that supply side efforts were needed as well, was never really addressed. Consequently, a national dialogue for greater economic stability (in terms the public can get behind), has scarcely begun.  Politicians and pundits alike continue to flounder about, while strategies for long term growth remain on the back burner. Consequently, it's up to the public to find their own means for growth strategies, and also to do so from the ground up. Building a base for skills arbitrage is a good way to start.

Some of what is attributed to structural problems, is really about the need to evolve past the limitations of present day institutional goals. Importantly, the factor of skills mismatch is constantly attributed to a lack of education. For the most part this argument completely misses the point - especially in a world where education has been extensive in relative terms. This so called "secular decline" is mostly due to the fact that countless limitations exist, both in product and production access definitions. They stand in the way of skill sets which people could already utilize from the educations they have already taken part in, through the course of their lifetimes.

Chances are, your underemployed neighbor is not really a "victim" of offshoring, for instance. Instead, she remains held hostage to the notion that her challenges and aspirations are not legal, appropriate or otherwise possible to extend to others on her own terms. Unfortunately, too many available skills sets have been usurped by the institutions along our Main Streets and other commercial designations. Some of those with the lucky commercial spots would still rather cave to the occasional wage hike, rather then let people back in to the marketplace by more rational means.

Of course there's the side benefit that wage hikes "clean" up neighborhoods nicely (snark intended) and send yet more unfortunates packing for parts unknown, One can only hope that the forgotten do not remain so, indefinitely. In that spirit, it's time to get specific about some alternatives to the seismic shift in economic equilibrium that continues apace. Where might communities begin the process of building skills arbitrage coordination, so that local residents can take part in services to assist one another? And - in the process - gain hope for a better future?

There are a number of ways to approach services curriculums and calendars at local levels. The most obvious is that of supplementing strapped public school systems, as well as the curriculums of some private schools.  It would not take a very extensive coordination process at all, for many communities to quickly move past the offerings that most schools are able to provide with their given budgets. Add to that some of the ongoing issues which individuals don't have ready answers for, and you have a place to think about beginning a community calendar. Plus, social elements need not be factored out, as they are often more important than they may seem.

To be sure, early versions of coordination for local economic agendas may appear crude, but then any beginning system or product seems that way at first: so was the computer. However it would be quite freeing for participants to be allowed numerous tries in terms of services offerings - something not always possible in more formal environments . After all, when institutions place products into the marketplace, they may be committed to that product in a long term sense, even if it isn't really needed as before. But what choice do they have? A lot of pain can be involved in letting go of products, for many reasons. What's more, the loss of the product may mean the loss of the institution as well.

Communities and individuals which would create multiple dynamic product offerings at any given moment, don't carry that same degree of survival risk, for they would effectively be supporting one another in mutual skills risk pools. Not every skills investment will necessarily "pay off", of course. When do they ever? Just the same, pooling diverse skills and knowledge sets under single coordinated umbrellas can provide considerable economic stability.

A number of years would probably be necessary, for any community to start making real connections between new educational efforts and ongoing local needs and aspirations. Indeed, communities would need to find their own unique imprints, before they might became relocation options for others who are seeking better ways to connect with others economically. By putting knowledge and skills use first, individual risks re time use, resources and most of all, money spent for skills infrastructural needs, will have greater societal impact and community wide support than is presently the case.

Some elements of calendaring would exist for short term situations - some as simple as a series of question and answer sessions, to longer term assistance in life skill sets. Local calendars would also make room for both emergencies and spontaneous needs (and proposals) which arise. Alongside traditional educational areas would be the education connected to local production projects - all of which are integrated so as to create safety nets for coordinated investments.

The institutions we now have, were once capable of providing us invaluable service capacities and job descriptions which in many cases didn't even exist, prior to the 20th century. While some forms of knowledge use aren't necessary going forward, many other patterns of work suggest directions for knowledge use which otherwise never would have been possible. The future is not so much about abandoning our institutions, as it is simply allowing them to evolve into more useful elements of our lives.

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