U.S. Brain Drain: "Semantics" Vs. Wages
Does America face a salary-based skill scarcity? The Business Council's latest survey seems to indicate just that. Two labor analysts gave CNBC's Sue Herera their perspectives on insourcing high-end labor.
The survey declares that CEOs "across the board" can't locate skilled workers. But Richard DeKaser, chief economist at National City, labels such conclusions a matter of "semantics." Putting aside "scarcity in particular occupations in particular locations," DeKaser cited the economic law that says that an all-encompassing skilled-labor shortage would have driven up real wages "dramatically." He pointed out that in the third quarter of 2006, corporate profit margins were the widest they've been in more than 40 years -- while real-wage gains were scant.
Stuart Anderson joined DeKaser on "Power Lunch" -- and contradicted him. Anderson declared that the "best evidence" of a brain drain is that the H1B Visa quota for highly skilled foreign workers was exhausted before the fiscal year's start. Scorning talk that foreign labor is automatically cheaper than their American counterparts, he pointed out that just the opposite can be true: costs of "importing" extra-national employees can be higher, including some $6,000 per capita in "legal and government fees."