Here’s a short excerpt, from my brand new report Get that Job!, that discusses unemployment in our nation’s economy and a few recommendations on how we as a country can transform our economy quickly to get Americans back to work. I hope you enjoy it.
The biggest issue in our country today is jobs and unemployment. But the fact is that unemployment is unnecessary in our economy. As long as there are problems that need to be solved, and customer needs to be satisfied, there are always jobs for the creative minority, like you.
The fact is that some people are never unemployed. No matter what happens in the economy, they bounce back and have a new job within a couple of days, and sometimes two jobs plus a job on the weekend. In this message, I’m going to tell you what we need to do, and what the country needs to do to get everybody back to work again, back to those bad old days of 2005 when unemployment was at 4%.
First, let me give you three types of unemployment, and three things that anyone can do to get back into the workforce.
Three Types of Unemployment
The three types of unemployment are voluntary, involuntary, and frictional.
Frictional unemployment refers to the number of people who are between jobs at any given time, usually about 4 – 5% of the population. For whatever reason, they have finished one job and have not yet decided to start another.
The second type of unemployment is voluntary. This is where there are jobs available for people but these people refuse to take those jobs because they are holding out for higher pay, or the jobs require that they do work they don’t want to do, or the jobs are located far away from where they currently live.
It is absolutely amazing to me when I read about people who were laid off from $120,000 a year jobs, and have been unemployed for two years, but they are still “holding out” for a job paying them what they used to earn during the boom of five years ago.
The third type of unemployment is involuntary. This is caused when the government passes laws that make it difficult or illegal to hire people at salaries and wages that companies are prepared to pay. There are now thousands of regulations and restrictions on employers that increase the cost of hiring someone.
The Cost of Hiring
The true cost of an employee is three to six times their actual salary or wage. This extra amount includes benefits, social security, medical costs, supervision, facilities costs, vacations, training costs, and many, many more factors that are added on top of the basic salary.
Every time government passes a new piece of legislation in any one of these areas, it makes it harder and more expensive to hire someone for a particular job.
The Definition of a Job
And while we’re on the subject, what is a job, anyway?
A job is an opportunity for an individual to create value, to make a contribution to a company that is greatly in excess of what a person costs in salaries, wages, and benefits.
This means that each employee must contribute more than they cost. In simple economics, if an employee is not contributing substantially more than he or she costs, the company must let that person go, or not hire them in the first place, if the company wants to survive.
Again, referring to simple economics, companies continue to hire people as long as each new person contributes more than they cost. If sales decline and company revenues fall, the business has to lay people off in order to survive. It’s not personal.
When you go into the job market, you are selling your personal services for the very highest price and under the very best working conditions possible. When the employer goes into the job market, he wants to buy the very highest quality and quantity of services at the lowest price. Salaries and wages are set by competition in the open market. If you want to earn more money, you have to create more value. There is no other way, unless the government hands out money to pay for jobs that create little or no value.
Three Ways to Get a Job
There are three ways that anyone can get a job. The first is to lower the amount you are demanding for your work. In times of recession, depression, market declines and reductions in business activities, if you want to sell your services, you have to hold a clearance sale, just like any store. You have to quickly cut the prices of your product, your labor, if you want to find a customer.
It is amazing how many people think that their salary is determined by what they want to earn. No. Your salary is determined by what people can afford to pay you, which is based on the value of the contribution you are capable of making in the current market in comparison with everyone else who wants that same job. You are in an auction, but in this case, you have to offer the lowest possible price if you want to sell your product against fierce competition.
Do Something Different
The second way you can get a job is by offering to do something different. With the rapid rate of change today, the explosion in knowledge, technology and competition, many jobs have gone away, and are not coming back for years, if ever.
Move Somewhere Else
The third way you can get a job is by moving to a place where there are more jobs available for what you want to do. There are parts of the country that are doing well, like Texas, where companies are moving and there are lots of jobs available.
There are parts of the country where there is demand for your skills, but you will have to pack and go there if you want to work.
Because of these three ways to get a job, nobody has to be unemployed for very long. Much of the unemployment today is therefore voluntary.
End of Excerpt
By BRAIN TRACY
Source from http://www.briantracy.com/blog/general/get-that-job/