Assorted links

by on May 1, 2013 at 11:48 am in Uncategorized | Permalink

1 Steven Kopits May 1, 2013 at 12:35 pm

Capex Compression in Oil Exploration and Production

An interview I gave last week. I recommend it to anyone interested in cutting edge topics in macro oil.

2 jseliger May 1, 2013 at 12:53 pm

1. Another look at the STEM job market.

Here’s Philip Greenspun’s comment about one part of the STEM job market: “Why isn’t there a glut of good software engineers?

3 Dan Weber May 1, 2013 at 1:49 pm

He’s been saying the profession is doomed for 10+ years.

4 john personna May 1, 2013 at 6:30 pm

Love that chart, as it both reinforces my priors and tells me something new … that non-stem is in a deeper dive than I thought.

5 Sisyphus May 1, 2013 at 1:16 pm

Once again debates about STEM make the fundamental errors of 1.) lumping those diverse fields with diverse career prospects together and 2.) ignoring opportunity and investment costs. Economists like to look at overall employment numbers for STEM graduates and salaries and conclude that since they’re better than average STEM must be a good investment. In reality, STEM degrees are very hard to obtain and take years (or decades) and the majority of people, at least in research, who get these degrees end up doing something else with the degree that they could have easily done without it. Just because you have a job making 60K a year and a person with a high school diploma makes 45K a year and has a higher unemployment rate doesn’t automatically mean that spending 12 years to get a PhD and borrowing (around the average) 25K or so was a good investment. It will be an even worse investment if even more people are granted these degrees or imported and your return declines.

I won’t even go into the enormous opportunity costs, but suffice it to say that people who can hack it in STEM could easily make far more money for less work in other fields. Decreasing incentives in an area with an already poor ROI (for the individual, since people don’t generally make microeconomic economic choices on the basis of positive externalities) might not be such a great idea.

6 Richard A. May 1, 2013 at 1:39 pm

1. Since so many who claim a STEM shortage are lawyers, it would be interesting to compare the unemployment rate of STEMs to lawyers from the CPS data going back to 2000. During the 70-71 recession, the MSM went berserk with stories about a glut of engineers and scientists–yet from the CPS the unemployment rate for engineers was only 2.2% in 1970 and 2.9% in 1971 — scientists had a similar unemployment profile.

7 Barkley Rosser May 1, 2013 at 1:40 pm

I know, I know, not the same, but the Brian Fey piece reminds me that my original hometown, Ithaca, NY, has long been described as “the most centrally isolated place in the world,” although I have heard the claim made also of State College (now University Park?), PA.

8 Peter Schaeffer May 1, 2013 at 2:27 pm

“Another look at the STEM job market”

Everyone should follow the link and read the article. The authors “prove” that we have a shortage of STEM workers because wages for STEM workers have risen by 1/3rd of a percent per year rather than actually declining as is the case for non-STEM workers.

So we have a shortage of STEM workers because wages haven’t gone down? Note that the article does show that STEM wages have fallen (a lot) from a peak in 2010/11.

If the topic was anything other then the über PC subject of immigration, the only conclusion anyone would reach, is the urgent need to close the door.

9 Jim Davis May 1, 2013 at 4:04 pm

From the actual blog post: “To be clear, the approach here does not claim that there is a shortage of workers in STEM and CMS fields.”

Maybe you could try actually reading the thing before spouting off.

10 Peter Schaeffer May 1, 2013 at 10:22 pm


Actually I did read the article. Did you? A few quotes…

“Recent claims of an excess supply of high-skilled workers in the STEM occupations of science, technology, engineering and math are at odds with anecdotal and empirical evidence. ” – That’s actually the first sentence.

“Despite this, some critics have voiced concerns about expanding visas for STEM workers, arguing not only that there isn’t a shortage of STEM workers, but in fact there are too many of them. Expanding high-skilled work visas, they claim, would push native-born American workers out of key technological occupations and reduce the wages of those who remain in them. Such claims are certainly outside the mainstream, but they have been taken seriously enough to appear recently in the Op-Ed page of the New York Times, the Washington Post, the Wall Street Journal, and most recently, the Atlantic.”

“The “we have too many high-tech workers” hypothesis is flawed because it is informed by an incomplete set of information. It also lacks common sense. The aforementioned articles rely upon a November report and a report published last week by the same think-tank, both of which point to tepid inflation-adjusted wage growth in computer and math sciences (CMS) fields—a subset of STEM—as definitive evidence of an abundance of labor supply in those professions.”

“At minimum, a more relevant question is: how did wages in the CMS fields, and by extension STEM, grow relative to other professions?”

In other words, the failure of STEM wages to fall as much as non-STEM wages “proves” there is a shortage.

11 Jim Davis May 1, 2013 at 11:13 pm

No… you aren’t understanding the difference between rejecting “we have too many high-tech workers” and saying “we don’t have enough.” I think the author is pretty clear that he is dissecting what others have said. This is a blog piece, not a study, and he’s just showing the weakness in that argument… that’s it. Determining one way or another if there is a “shortage” relies on much more detailed occupation-by-occupation analysis than you see here (as he admits) and in other work done before (which they don’t admit). They are the ones staking out a claim and he’s critiquing that. No, more. In short, he’s saying “if you’re right that we have too many, you’d see X, Y and Z. And we don’t.” Period.

12 Peter Schaeffer May 1, 2013 at 2:32 pm

The issue of native displacement from STEM fields is very real. A few years ago, I took my son on a tour (open house) of Harvey Mudd university. A very impressive school to say the least. More on that later. What shocked me, was the professors literally begging the parents and kids to consider a career in science and technology. I heard professors saying things like

“You will be able to get a job”
“No, jobs for software engineers still exist in the U.S., lots actually”
“Scientists and engineers have very low unemployment”

The skepticism of the prospective students and parents was palpable. The combined notions that your job will be outsourced and you will be replaced (sooner or later) by an H1B were commonplace. Of course, they were a material deterrent.

What made this so disturbing is that the Harvey Mudd professors were right. Harvey Mudd graduates have (probably even today) excellent job prospects. Harvey Mudd may well be the best science and technology school in the U.S., perhaps better than Caltech and MIT (though smaller). Decades ago, I obtained a science degree from a school with a good reputation, the University of Chicago. I was amazed at how much better the Harvey Mudd students were. The Harvey Mudd professors had/have considerable basis for their confidence, as to the employment prospects of their students. Yet even in Claremont, CA parents and students were apprehensive. Note that my visit was well before the crash of 2008.

13 uffy May 1, 2013 at 3:48 pm

These are exactly the sorts of real determinants of potential TFP that remain grossly understudied or discussed.

14 JWatts May 1, 2013 at 4:18 pm

+1 on the STEM job market article.

15 X May 1, 2013 at 4:20 pm

3. Woah it looks like the Shanghai/Chinese government is tremendously good and efficient at selling these licenses

Maybe we should put the Chinese in charge of selling public goods in the U.S. and Europe too.

What happens though if someone wants to drive a foreign car there? Are they denied entry? Or is this a trivial loophole?

16 Mark Thorson May 2, 2013 at 12:36 am
17 Mike H May 2, 2013 at 1:07 am

#1 A danger of using STEM workers shortage to support skilled immigration is that it might open the door for some to push for an immigration ban on non-STEM workers and foreign students in the US who study in other academy fields. That would include all the degrees and PhD in social science (including some majors like education and foreign language that are actually in high demand), professions that don’t rely on STEM degree but demand high technical skills or experiences (pilots, merchant seamen, chefs etc). Take away their hope of ever working in America, and you can only imagine how many foreign students would then study somewhere else like in the UK or Europe. Last year there were 764,495 international students in US colleges, my guess is that non-STEM students accounted for at least 80% of that number.

And yet that is precisely the assumption such argument build upon isn’t it? That natives should be protected from those job-grabbing foreigners and students unless they happen to be learning or possessing skills that no American wanted to learn. Welcome to the American dream 2.0.

18 Floccina May 2, 2013 at 3:42 pm

Problem with the STEM worker date:
1. Those who say we need more STEM grads often sound like they are saying we need more intelligent people rather than we need more people trained in STEM.
2. If we need more STEM workers one way to get them is to make STEM studies easier and more enjoyable.
3. If you believe STEM studies are training rather than testing and most people with math degrees are working as computer programmers that implies that we have too many people trained in math and too few trained in computer programing. Their math degrees are only evidence that they are smart and so will learn to program quickly.
4. How low in the class should be getting good jobs before we know we need more STEM grads? How the bottom 10% of STEM grads should they be working in STEM as scientists?

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