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Ford CEO on his ‘epiphany’ after talking to factory workers in 2023

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Re: Ford CEO on his ‘epiphany’ after talking to factory workers in 2023

#41

Post by moi2388 »

skeeter2020 wrote: post #12
techdmn wrote: post #7

Seems like a good time to mention my old stand-by: There is no such thing as a labor shortage. There may very well be a shortage of qualified people willing to work under the conditions and for the compensation a company would like to provide. When stated that way you can see that there are several levers to pull, the most obvious being compensation.

your old stand-by doesn't make any sense "there is no such thing as a labour shortage" is totally represented by a shortage of qualified people for the given compensation. This is the basis of every economics supply & demand graph, where explicitly refer to the misalignment as a surplus or shortage.

Economics supply & demand graphs assume entities act rationally.

It can however occur that a company requires skill x, cannot find a person for this position, and HR still refuses to increase salary for this position.

There is a mismatch in supply & demand of compensation. Not position.

Re: Ford CEO on his ‘epiphany’ after talking to factory workers in 2023

#43

Post by sdenton4 »

ZephyrBlu wrote: post #30
nerdsniper wrote: post #3

> Ford’s signature element in its new labor agreement was to get full wages to entry-level workers. But beyond that, he began looking at the labor shortage in trade work, starting with technicians.“Old-timers in our plants were saying, ‘It’s no longer a career, Mr. Farley. Working at Ford is no longer a career.’” He warned that millions of well-paid jobs are going unfilled because they require specialized skills. Put…

Pretty crazy improvement, seems like he's putting his money where his mouth is

Yes, and also: Is it good for a factory for when the average worker has three jobs and only gets six hours of sleep? Sounds like a recipe for recalls...

Re: Ford CEO on his ‘epiphany’ after talking to factory workers in 2023

#44

Post by cwmma »

nerdsniper wrote: post #11
techdmn wrote: post #7

Seems like a good time to mention my old stand-by: There is no such thing as a labor shortage. There may very well be a shortage of qualified people willing to work under the conditions and for the compensation a company would like to provide. When stated that way you can see that there are several levers to pull, the most obvious being compensation.

99% of the time, I agree with you. But hypothetically, what would you call a situation where 20 companies would all be willing to pay salaries of $1 million/year to fill 10,000 open positions that required 5 years of training, but there are only 5,000 people who have that training? Would that be a "labor shortage"? It seems your solution works for companies willing to pay more to poach from other companies, but might…

A better thing to say, is that there are no long term labor shortages, in the short term you can have booms where there aren't enough people to fill the jobs but in your example the shortage would last at most 5 years but you'd also have things like better assistance or automation so one person may be able to fill more then one of those positions, you'd probably also have people that could come out of retirement for enough money, or people in related fields that could train in less then 5 years. For enough money on the table you'd probably have people trying to figure out if you can train somebody in less then 5 years. This is also the issue that HB1 visas are intended to solve.

If enough money is on the table people can skill up fast.

Re: Ford CEO on his ‘epiphany’ after talking to factory workers in 2023

#45

Post by floatrock »

nerdsniper wrote: post #25
freedomben wrote: post #15

Earlier quoted context omitted.

I don't disagree, but I do think the modern culture of company hopping is contributing to this. As a leader entrusted to make good decisions for the company, you must consider this reality. At a previous company we hired a lot of junior engineers with the idea that our relatively high pay and reasonably good work would help us build a strong generation of seniors a few years down the road. What we mostly found was th…

What's the structural solution to this? Offer golden handcuffs to stay for x years? - "We'll train you, and if you stay the full 8 years you get a $500,000 bonus"? - "Here's a $200,000 signing bonus, which you have to pay back if you leave before 8 years" I'd be hesitant to rely on these as a candidate, because I'd have to assume I'd get fired at year 6-7 or something so that the company could save money.

from the op:

> ridiculously stupid HR practices... a structure in which the only way to get a raise was to leave the company, and that was also often the best way to get promoted too

Until that culture changes, of course you're gonna assume you get fired or issued a surprise RTO order at year 7.5.

When the social contract becomes penny-pinching every opportunity, of course the employees are gonna start playing that game too.

Re: Ford CEO on his ‘epiphany’ after talking to factory workers in 2023

#46

Post by freedomben »

baby_souffle wrote: post #24
nerdsniper wrote: post #11

Earlier quoted context omitted.

99% of the time, I agree with you. But hypothetically, what would you call a situation where 20 companies would all be willing to pay salaries of $1 million/year to fill 10,000 open positions that required 5 years of training, but there are only 5,000 people who have that training? Would that be a "labor shortage"? It seems your solution works for companies willing to pay more to poach from other companies, but might…

> At some point, the salaries are indeed "high enough" but the skills still just aren't available to hire. But the incentive to develop the skills should sort this out, no?

In the long term, yes definitely, and we saw that work first-hand in software development as bootcamps and comp-sci grads started cranking people out. However, the ramp-up time means that during those 5 years that it takes for more people to get qualified, this corrective affect won't help.

Also in the real world the wages are sticky enough that they take time to adjust, and then it takes time for people to realize that X field is becoming well paid and then start pursuing it, so realistically the 5 year period is more like 7 to 10. Plus as long as the industry is growing/expanding, demand can continue to outstrip supply due to that stickiness.

Even rapid moving stuff like AI has bee illustrative of this. The AI leaders are all primarily poaching, and wages are astronomical. This is undoubtedly fueling a massive number of people to study/specialize in AI, but it takes years (maybe even a decade) to complete that path (depending on your starting point).

Re: Ford CEO on his ‘epiphany’ after talking to factory workers in 2023

#48

Post by greymalik »

techdmn wrote: post #7

Seems like a good time to mention my old stand-by: There is no such thing as a labor shortage. There may very well be a shortage of qualified people willing to work under the conditions and for the compensation a company would like to provide. When stated that way you can see that there are several levers to pull, the most obvious being compensation.

I agree with that, but isn’t it also the case that if an employer raises wages enough to get the workers they need, they have to do some combination of passing those costs along to customers and reducing the benefits to shareholders, which in turn reduces their ability to remain a viable business and keep people employed? It’s a balancing act.

Re: Ford CEO on his ‘epiphany’ after talking to factory workers in 2023

#49

Post by parineum »

techdmn wrote: post #7

Seems like a good time to mention my old stand-by: There is no such thing as a labor shortage. There may very well be a shortage of qualified people willing to work under the conditions and for the compensation a company would like to provide. When stated that way you can see that there are several levers to pull, the most obvious being compensation.

> and for the compensation a company would like to provide.

"would like to" is usually "can justify, financially". Most companies don't have a bunch of extra money laying around.

> When stated that way you can see that there are several levers to pull, the most obvious being compensation.

I know the way you mean that (companies pay more) and that's an option that does happen but it also goes the other way, employees can accept less (unless minimum wage makes it illegal for people to accept work).

Re: Ford CEO on his ‘epiphany’ after talking to factory workers in 2023

#50

Post by sdenton4 »

nerdsniper wrote: post #11
techdmn wrote: post #7

Seems like a good time to mention my old stand-by: There is no such thing as a labor shortage. There may very well be a shortage of qualified people willing to work under the conditions and for the compensation a company would like to provide. When stated that way you can see that there are several levers to pull, the most obvious being compensation.

99% of the time, I agree with you. But hypothetically, what would you call a situation where 20 companies would all be willing to pay salaries of $1 million/year to fill 10,000 open positions that required 5 years of training, but there are only 5,000 people who have that training? Would that be a "labor shortage"? It seems your solution works for companies willing to pay more to poach from other companies, but might…

Hire an expert and an apprentice to work with them. Now you've got 10k workers.
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