The Truck Driver Puzzle
An economist who attended a business conference told me that the trucking industry is doing well (probably a sign that the economy overall is improving). However, industry experts foresee a shortage of drivers next year. How is that? Some possibilities:
1. The experts are wrong. In today’s economy, there will not be a shortage of truck drivers.
2. While many people are capable of driving a truck, not many of the currently unemployed think of it as their comparative advantage. Instead, they think, “I should not train to become a truck driver, because in the long run I will have a job more suited to my skills.”
3. While many people are capable of driving a truck, they associate it with a lifestyle that they do not want.
4. While many people are capable of driving a truck, they associate it with low status, even lower than being unemployed for a long time.
5. Not many people are really capable of driving a truck. (My source says that you do need to pass a drug test.)
If I had to bet, I would probably pick (1). But if one of the other answers turns out to be correct, then I think it speaks well for PSST and poorly for the AS-AD paradigm of homogeneous labor.
p.s. Reading David Henderson’s criticism, at first I could not understand his problem. He says that at one time I suggested that it would take a 25 percent cut in wages for workers to be employed, but then more recently I implied it would take a 90 percent cut in wages.
Look, I have no idea how big a cut in pay it would take. My point is that it is large. It would be a lot smaller if workers were willing to accept jobs that are far from their long-term comparative advantage. Taking a job as a truck driver might not even mean a drop in pay for workers who have recently lost their jobs. But people want to find a long-term source of comparative advantage. That is difficult in a complex economy.