Wednesday, December 26, 2012

NY Times can't get the story straight on college

In today’s NY Times, we see an article which worries that people in Montana are forsaking college to work at $50,000/year jobs in the oil fields.

It is a lucrative but risky decision for any 18-year-old to make, one that could foreclose on his future if the frenzied pace of oil and gas drilling from here to North Dakota to Texas falters and work dries up.

The guy who wrote this (Jack Healy) obviously didn’t attempt to synchronize his message with the NY Times article from this weekend about how three girls from lower socioeconomic backgrounds went to college but it didn’t work out so well for them. All they got out of college was a lot of debt.

Now, in theory, yes, it’s a lot better to have a good white-collar career track than to do manual labor in the oil fields. The oil companies will just fire these people when there’s no more oil or they can find cheaper labor (such as immigrants or robots).

But how many of these kids from Montana allegedly forsaking college to work in the oil fields have a realistic chance of getting into a good white-collar career track? Most would probably end up like the girl in the NY Times article who has $61,000 of student loan debt and is working at a furniture store for $8.50 an hour. This is especially true if they are only marginally college material or if their parents are working-class and unable to give them proper career and life guidance.

23 comments:

  1. Why would you assume companies would be any less likely to fire white collar workers and replace them with either immigrants or robots? The "career track" is becoming a thing of the past.

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    1. Companies will fire anyone if management thinks it will lead to higher profits. But it's hard to replace skilled labor that requires English-language skills or understanding of American culture with immigrants.

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    2. It's much harder to fire a white collar worker and replace him with an illegal immigrant or to source out the work to a third party who will then hire an illegal immigrant or to replace the worker with a newly legalized immigrant. This is so obvious, it needs no further elaboration. These things are just not done (yet).

      SWPLs don't give a damn about working class people.

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    3. Why would you assume companies would be any less likely to fire white collar workers and replace them with either immigrants or robots?

      Routine occupations are a lot easier to automate than non-routine occupations.

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    4. Working in the oil patch is also a non-routine occupation.

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  2. So far there hasn't been any scaling back of the oil producing activities in North Dakota and elsewhere, and no job losses. Which isn't to say that the situation will continue, of course, as oil is a notoriously boom-or-bust industry. And in any event, the money's good enough that working in the oil fields for just a couple of years can give a worker a nice financial cushion.

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  3. I doubt you read Paul Krugman, but recently he's been writing quite a bit about automation's effect on employment.

    http://krugman.blogs.nytimes.com/2012/12/26/capital-biased-technological-progress-an-example-wonkish/

    http://krugman.blogs.nytimes.com/2012/12/26/is-growth-over/

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    1. Interestingly enough, some clever person figured out how to automate Paul Krugman's job way back in 1996.

      http://www.elsewhere.org/pomo/

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    2. Yes, talking about the impact of capital on per-worker productivity is the same as Continental philosophy.

      You are no more than a Randian cultist.

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  4. The worst thing that can happen to an oil field roughneck is that they might get their wages cut or lose their job entirely, which leaves them roughly where they started (or ahead of where they started if they saved any of that money). But if college doesn't work out, you're stuck with massive debt that you can't even escape with bankruptcy. Which is riskier?

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    1. It depends.

      College is not risky at all of the student's parents are paying 100% of the bill.

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    2. Not Always. I'm stuck with $50k of student debt and I didn't even finish. Good thing my plan B worked out, getting a bachelors degree job with an associates degree, or I would have been stuck in low wage slavery for 30 years.

      I know at least one poor girl who has over $100k in student debt and with her english degree can't hope to make what those oil field workers make. And no her parents aren't helping her. The idiot company that loaned her the money should be liable to lose money on that loan, but alas student loans can't be discharged in bankruptcy (and probably they wouldn't have loaned her the money if it weren't for that which would have been better for everyone.)

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    3. I know at least one poor girl who has over $100k in student debt and with her english degree can't hope to make what those oil field workers make.

      I doubt that the oil field companies only hire men.

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  5. If the oil dries-up--or rather the oil jobs due to government regulations, then the kids can still go to college if they like. Oil workers are a highly skilled group and there is a lot of demand for people with cutting-edge experience. If the jobs in ND dry-up they will go to Mexico, Nigeria or Brazil.

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  6. I don't consider oil field work routine operations. It seems like it would be more like construction work and that would be difficult to automate.

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  7. Healy is obliquely warning us that his Ivy League friends are planning to ship in Chinese drilling crews who can do the work cheaper with more Transnationalism and Globalvillagism.

    In other words, "Enjoy it while it lasts, suckas! Now that Real Wages are being paid you are out the door and the coolies are moving in!"

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  8. X.V-i

    "College is not risky at all of the student's parents are paying 100% of the bill."

    The student risks spending several years on an unfinished degree without a payoff. He also risks financial help his parents might have offered in other contexts had the student not wasted their money on an expensive non-degree.

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  9. Oilfield work is generally considered highly skilled labor, yes. It has a career track for the blue collar end which ends at Tool Pusher (which can be a six figure income). The downside is the migratory nature of the job. The upside is that when an oil boom ends one place, that companies will hire americanskis to work anywhere in the world.

    Around here, the bottom of the barrel makes about $20/hr to start, with buckets of OT available. And wages go up fast.

    For a moderate intelligence male, college doesn't offer anywhere near this level of opportunity. For those of an entrepreneurial mindset (not necessarily those of very high intelligence), there are tons of opportunity to make bank going into business yourself. Most of the drilling and services companies around here (SE NM) are independent small businesses. Welders can get over $90/hr for jobs, etc...

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  10. What's ironic is the only reason why shale oil deposits like those you see in North Dakota are even profitable is because of the artificially inflated price of gasoline due to government regulation.

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  11. Yes, college is a bad idea for most. Something like 20-25% of baby boomers went to college, which was probably too many. People whose grandparents didn't go to college probably shouldn't be going to college, and thus the percentage should be lower than it was for the boomers. Realistically we should probably have only 10% going to college: scientists, engineers, and the upper classes.

    The problem is telling people that they should be the ones to not go. There are families where both parents mistakenly went to college when they shouldn't have. How are these parents going to tell their children to skip college?

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  12. The Undiscovered JewDecember 27, 2012 at 5:00 PM

    Due to the retirements of older machinists there is a lot of demand for specialized blue collar labor. The pay in these fields is better than in many white collar professions. The much discussed proles should be corralled into more narrowly focused machinist trade schools.

    And, yes, less specialized blue collar jobs don't pay as well as specialized. But this is also true of non-specialized white collar jobs.

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  13. This girl made so many errors it's ridiculous. She didn't even bother submitting her financial aid paperwork so had to get a last minute loan. The article tries to paint this as a result of her disadvantaged background but she was just irresponsible. It also sounds like she was in over her head academically. She failed a lot of classes, was overwhelmed, got depressed, dropped out. As far as oil fields being an alternative, it's not really an option for women. The closet women can get to reasonably well paid grunt work is teaching. Education degrees are one of the easiest degrees to obtain and the pay can be decent once in the system long enough, with pensions etc. factored in. My 103 year old grandmother raked in a pension and health insurance for 53 years courtesy of the board of ed. (Not to disrespect her memory, she actually was a very smart lady but women could only be teachers or nurses back then.)

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  14. In Montana, $50,000 per year is a nice salary. Young men with roommates can easily save over half that money. If they are prudent enough to invest the savings until retirement, they could be rich.

    People from "lower socioeconomic backgrounds" should not borrow money to attend private universities. They should go to a state school, get good grades, and apply for a private university scholarship for further studies.

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