Friday, September 04, 2009

The cost of talent

Economists argue that there is no such thing as "a workforce shortage" -- there is only "a workforce shortage at a particular prevailing wage."
The situation is complicated by the fact that there's a lot of delay in the system: you don't produce a top-quality engineer in a week, or a month, or a year, or even a decade.
If, 15 years ago, entry-level engineers and computer scientists had been paid what entry-level lawyers and financiers were getting paid, then it's reasonable to guess that today, 15 years later, we would have lots more entry-level engineers and computer scientists.
So, if the question is "Do US companies offshore and hire H-1B's because of the need for talent, or because of the cost of talent?" the answer is "yes."

Ed Lazowska
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