Why Corporations prefer high unemployment.

First of all, please read this thread and the Krugman article it links to:

http://www.democraticunderground.com/10021880890

But I would take it a little further, having been involved for many years in Corporate hiring.

I am speaking from anecdotal evidence which normally I argue to reject. For instance, everyone knows someone who has abused Welfare Program - but they don't know the masses who benefit from Welfare Programs because they are struggling and need them. usually because those people don't speak of it, which leads to a one-sided and limited understanding on the part of many people. I often refer to cutting out welfare because of these anecdotal references to cutting off your arm because you have a mosquito bite on your hand.

But please hear me out here, because this particular anecdotal evidence traverses an entire lifetime and also actually makes sense!

I have lived and worked through several recessions of varying degrees, and through various unemployment rates. I have noticed that when the unemployment rate is low, that it is much more difficult to hire "quality employees". However, when unemployment is high, any job at all is more attractive to the jobless, despite their talents. Therefore, high unemployment means being able to hire more productive employees at cheaper wages.

Therefore, higher unemployment means higher productivity. At least, from a Corporate point of view.

There is another issue - training.

Having been involved in both University training and Corporate training and hiring, I can tell you that University training is basically useless. Everything you learn in your university training is irrelevant, being based on ideal circumstances that don't exist in the real world. However, hirers prefer people with Diplomas NOT because of what they have learned, but because it proves that they are capable of learning and finishing what they have started. Then they have to be re-trained to meet the proprietary needs of the company, and the preconceptions of the management (good or bad).

Unfortunately, many companies have cut their training programs. This is more than ridiculous! They are looking for recruits to meet their unique specifications, yet they are unwilling to train potential employees to meet those standards. If, of course, they were willing to invest a little money in what they admit are their greatest resources, they would meet their goals.

To me, this is the greatest hypocrisy - they (being the Corporations) admit that their greatest asset is their people - and yet that is first place they cut.

Is there any wonder that our American economy is in trouble?