Overqualified: What's Wrong With European Labor Markets
By Bryan Caplan
One of the most striking things about Denmark and Sweden: Almost everyone is overqualified for his job. The guy who sells train tickets doesn’t just punch buttons and collect cash; he knows his regional transit network like the back of his hand, and eagerly helps you plan your trip.
I’m sure that most American tourists find this a welcome change of pace. Imagine a country where you never have to ask, “Could I talk to your supervisor?” But it’s highly inefficient. In the U.S., the Dane who mans the ticket window would run the whole office. In Denmark, he spends 59 minutes out of 60 doing mindless, menial work.
When I explained my observation to some Swedes, there was an interesting misunderstanding. One told me: “Unskilled workers? We don’t have unskilled workers.” I replied, “I’ve seen guys picking up garbage. Isn’t that unskilled?” And the Swede answered, “We have unskilled work, but not unskilled workers.” My point exactly.
What’s going on? Americans tend to credit Europe’s better schools, but I doubt that’s a major part of the story. The main reason why European workers seem so good, as many Scandinavians admitted, is that they keep semi-competent workers permanently on welfare.
It’s tempting to see this approach as “more efficient” or “kinder-hearted” than ours, but it’s neither. Using high-skilled workers to sell train tickets when low-skilled workers are almost as good violates the principle of comparative advantage. And it’s hardly kind to create a system where workers feel unchallenged, and non-workers feel useless. The European approach may be good for flustered tourists. But for the Europeans themselves, it’s a tragic waste.