Today’s announcement of the Nobel Prize in economics may have a particular resonance for the many young scientists trying to move to the next step in their careers. Peter Diamond of MIT, Dale Mortensen of Northwestern, and Christopher Pissarides of London School of Economics shared the honor for models that mathematically explicate something countless job seekers–or, for that matter, would-be employers–already know. Finding the right position or the right worker is not something that happens automatically, but instead itself involves a lot of work, or, as the economists put it, “friction.”
Before the laureate trios’ research, economic theory apparently assumed that the market for workers functions rather like the ones for wheat or oil you learned about in Economics 101, where buyers and sellers easily find each other and agree on a price based on supply and demand.
But, of course, as anyone who has sent out futile resumes could have told them, landing a suitable job involves, first and foremost, finding out where appropriate vacancies may lurk and crafting an application that fits the employer’s needs. This takes information that can be difficult or impossible to obtain, especially if no means exist for the two sides of the employment equation to exchange information effectively and efficiently.
This is certainly the case for many non-academic positions in scientific and technical fields. And it may in part account for the oft-noted discrepancy between the perception of job seekers, who see a glutted market, and those employers who complain that they cannot find the workers they need. (Other observers of course argue that the “shortages” companies suffer are not of qualified people, but of qualified people willing to work for what they want to pay.) Still, a good deal of information “friction” undoubtedly exists and if it could be reduced, quite a number of people on both sides would probably be a lot happier.
Professor Diamond has lately been experiencing considerable friction in a job search
of his own. Nominated by President Obama in April to the Federal Reserve’s Board of Governors, he has been blocked Senate Republicans. But, as thousands of young scientists could have told him, getting a good job isn’t easy.