Pharmacy graduates are finding a softer job market

One of America’s most reliable professions is producing too many graduates and not enough jobs

A few years ago, students enrolling in college as pharmacy majors had high hopes about lucrative careers.  Now the outlook is not so rosy.

… Even as the economy struggled in the mid-aughts, pharmacy graduates easily found big salaries, 9-to-5 jobs, and the respect that came along with handling medications. Nicholas Popovich, a professor at the University of Illinois at Chicago College of Pharmacy, tells me that, “Some signing bonuses even involved a car, that type of thing.”

While New Republic labeled pharmacy careers to be “on the verge of a crisis”, the details don’t necessarily indicate the problem has risen to crisis level.

• There has been a 70% increase in first-professional PharmD degree graduates from 2001 to 2011 due to the opening of new pharmacy schools and the expansion of existing programs.
• The aggregate demand index (ADI), a tool that tracks the difficulty of filling pharmacy positions nationally, had remained relatively steady at a level of ADI = 4 (moderate demand) from 2002 to 2008 but has had a downward trend closer to 3 (demand in balance with supply) in more recent years, with several states in the Northeast region having their ADI dip below 3.
• The anticipated role expansion and demand for pharmacists to provide direct patient care services has not come to fruition, causing a lower than expected creation of new pharmacist jobs.
• The bottom line is that the supply of new pharmacists seems to be outpacing the creation of new jobs because the role of pharmacists has not changed as expected when pharmacy workforce needs were projected in 2001.

The number of pharmacy schools has almost doubled over 20 years alongside exuberant predictions about a boom in jobs.

… PharmD students are cash cows, taking on hundreds of thousands of dollars in debt and often committing to a longer course of study…

Meanwhile, graduates dealing with average debt loads of over $130,000 find themselves in a growing competition for jobs.

The scarcity of jobs is regional, with the Northeast and New York in particular experiencing a surplus of pharmacists.

AGGREGATE DEMAND INDEX 10-YEAR TREND

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 Katie Zavadski, “The Pharmacy School Bubble Is About to Burst”, New Republic, September 29, 2014.

Randy P. McDonough, “Improving patient care, securing our role in health care: The time is now!”, American Pharmacists Association, November 01, 2014.

It looks like ‘the demand for lawyers will keep shrinking’

The surplus of lawyers looking for jobs has been apparent for several years now, “and the number of jobs is apt to shrink further as technology sinks its teeth into legal work”.

In his recent City Journal article Machines v. Lawyers, Northwestern Law School professor John O. McGinnis explained why the demand for lawyers will keep shrinking. “Law is, in effect, an information technology – a code that regulates social life. And as the machinery of information technology grows exponentially in power, the legal profession faces a great disruption not unlike that already experienced by journalism, which has seen employment drop by about a third….”

Throughout the 60s, 70s, and 80s, law was a growth industry and a great many people (especially students who had taken “soft” majors in college) figured that earning a JD was an attractive option. Naturally, law schools expanded to accommodate the throngs of degree seekers, who were aided by federal student loan programs. Going to law school both delayed the need to start repaying undergraduate loans and appeared to be the pathway into a bright and lucrative career.

That’s not true anymore.

McGinnis gives details on how technology is disrupting the legal profession.

Discovering information, finding precedents, drafting documents and briefs, and predicting the outcomes of lawsuits—these tasks encompass the bulk of legal practice. The rise of machine intelligence will therefore disrupt and transform the legal profession.

Fewer lawyers will be needed, but superstar lawyers will prosper.

A relatively small number of very talented lawyers will benefit from the coming changes. These superstars will prosper by using the new technology to extend their reach and influence. For instance, the best lawyers will need fewer associates; they can use computers to enhance the value that they offer their clients. Already, the ratio of associates to partners in big law firms appears to be declining. In complex cases, lawyers will continue to add value to machine intelligence through uniquely human judgment. Even now, when computers regularly beat the best chess grandmaster, a good chess player and a good computer combined can often beat the best computers. Thus, for important cases and transactions, good lawyers will still add substantial value, even if computers do more of the work.

As McGinnis noted, journalism is another profession severely impacted by technology, possibly pointing to a future where computers will be handling many of today’s white-collar jobs.

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George Leef, “The Canary in the Law School Coal Mine?”, Minding The Campus, October 9, 2014.

John, O. McGinnis, “Machines v. Lawyers”, City Journal, Spring 2014.

The problem of student loans that don’t deliver on jobs

Kevin Carey in the New York Times writes about how vocational training programs over-promise and under-deliver on their promise to train students for well-paying jobs.  He highlights the problems with medical assistant training programs.

Many people who graduate from such programs struggle to find work. Those who do find work often make little money — too little to repay their debts from the program. Despite the happy poster images, the market for medical-assistant education is actually an allegory for the problems in the parts of higher education that tend to attract low-income and middle-class students: little regulation and uneven — often mediocre — results. The same problems afflict many community colleges, lower-tier four-year colleges and training programs in fields like office management and culinary arts.

According to the Department of Labor, the median annual salary for medical assistants in 2011 was $29,100. Yet most recent graduates of medical-assistant training programs earn much less, which suggests the programs are not reliable routes to good jobs as assistants. Among the 100,000 students who earned a medical-assistant certificate in 2008 or 2009, roughly 94 percent attended a program where graduates typically earned less than $20,000 in 2011, the data show. More than 50 percent attended a program where typical graduates earned less than someone working full time at the federal minimum wage would — $15,080. That can only mean many were not working full-time in any job.

Clearly the return on investment is painfully insufficient for many trained medical assistants, as well as for many other graduates of our faltering higher education system.  Carey attributes the problem to false advertising, noting that “it’s nearly impossible to find an employer who explicitly requires a certificate”.  He calls for increased regulation as the solution.

The medical-assistant education market is inefficient because the American higher education system is largely unregulated. Every year, the federal government gives students $150 billion in grants and subsidized loans to attend any program offered by any accredited college. The assumption is that the free market will take care of the rest. But college is what economists call an “experiential good” — something you can’t entirely understand until after you purchase and experience it, at which point it may be too late.

Inadequate loan underwriting creates “distortions and useless degrees”.

I actually agree with Carey’s general point that new regulations are needed to curb abuses arising from the haphazard distribution of billions of dollars of taxpayer funds with very little accountability.  But my take on the problem is closer to how this highly-ranked comment frames the problem, with a need for the federal government to do a better underwriting loans.

It is amazing how this article and most others on the the subject never mention the elephant in the room.

It is the Federal Government’s policy to dump money, in the form of grants or loans and loan guarantees, for virtually any degree, any college, to anyone, that creates these distortions and useless degrees.

Do you think any private bank without the Federal Student Loan guarantees and laws would ever lend $18K in unsecured loans to 18 year olds with no assets and no income attending these programs?

Do you think many parents or family would be writing actual checks of $18K for people to attend without making sure they lead to actual jobs?

Of course not. The Federal Government policies inflate the cost of higher education and preserves the existence of thousands of non-viable programs of higher education.

Until we address that, these distorted results will continue to be with us.

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Kevin Carey, “When Higher Education Doesn’t Deliver on Its Promise”, New York Times, Oct. 4, 2014.

Negative consequences of believing the STEM shortage myth

In his book Falling Behind: Boom, Bust & the Global Race for Scientific Talent, author Michael Teitelbaum challenges the commonly held belief that the United States suffers from a shortage of STEM workers.

The truth is that there is little credible evidence of the claimed widespread shortages in the U.S. science and engineering workforce….

A compelling body of research is now available, from many leading academic researchers and from respected research organizations such as the National Bureau of Economic Research, the RAND Corporation, and the Urban Institute. No one has been able to find any evidence indicating current widespread labor market shortages or hiring difficulties in science and engineering occupations that require bachelors degrees or higher, although some are forecasting high growth in occupations that require post-high school training but not a bachelors degree. All have concluded that U.S. higher education produces far more science and engineering graduates annually than there are S&E job openings—the only disagreement is whether it is 100 percent or 200 percent more. Were there to be a genuine shortage at present, there would be evidence of employers raising wage offers to attract the scientists and engineers they want. But the evidence points in the other direction: Most studies report that real wages in many—but not all—science and engineering occupations have been flat or slow-growing, and unemployment as high or higher than in many comparably-skilled occupations.

Although some STEM fields are booming and employers find it difficult to fill professional positions, by no means is that true across the board.

Teitelbaum lists five episodes of STEM ‘“alarm/boom/bust” cycles since World War II’ where in all cases government policies intended to address false claims of shortages only exacerbated the problem.

… Each lasted about 10 to 15 years, and was initiated by alarms of “shortages,” followed by policies to increase the supply of scientists and engineers. Unfortunately most were followed by painful busts—mass layoffs, hiring freezes, and funding cuts that inflicted severe damage to careers of both mature professionals and the booming numbers of emerging graduates, while also discouraging new entrants to these fields.

The current administration has fallen into the same trap, pushing for more STEM graduates who may actually find jobs in short supply.  This year New York began allocating taxpayer funds to encourage college students to pursue STEM majors.

Ignoring “science-based evidence” produces “large unintended costs”.

Ironically the vigorous claims of shortages concern occupations in science and engineering, yet manage to ignore or reject most of the science-based evidence on the subject. The repeated past cycles of “alarm/boom/bust” have misallocated public and private resources by periodically expanding higher education in science and engineering beyond levels for which there were attractive career opportunities. In so doing they produced large unintended costs for those talented students who devoted many years of advanced education to prepare for careers that turned out to be unattractive by the time they graduated, or who later experienced massive layoffs in mid-career with few prospects to be rehired.

George Leef is another critic of these government interventions.

… Strong business and educational groups lobby for nice-sounding policies that benefit themselves, frequently employing dubious arguments and misleading claims. The costs of the resulting pro-STEM policies are dispersed among the public, and fall particularly hard on the unfortunate individuals who invest a lot of money and years of their lives in pursuit of credentials that are apt to become almost worthless.

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Michael S. Teitelbaum, “The Myth of the Science and Engineering Shortage”, The Atlantic, March 19 2014.

George Leef, “True Or False: America Desperately Needs More STEM Workers”, Forbes, June 6, 2014.

Ten career paths you may want to avoid

A new study released Tuesday by job-search site CareerCast.com, lists the 10 top endangered jobs in the U.S. Using data on 200 jobs from the Bureau of Labor Statistics, CareerCast projected the least promising career paths in terms of future employment growth, income potential and existing unemployment in the job field.

1. Mail carrier
2. Farmer
3. Meter reader
4. Newspaper reporter
5. Travel agent
6. Lumberjack
7. Flight Attendant
8. Drill-Press Operator
9. Printing Worker
10. Tax Examiner and Collector

“The common theme in these jobs is paper,” says Tony Lee, publisher of CareerCast.

There is simply less demand for the type of work represented by these jobs, in most cases due to technological advances.

Since I have recently been spending many frustrating hours planning my summer vacation, I wish travel agents would make a comeback.  Apparently there is a trend toward a fee-for-service model among travel agents, particularly in the FIT (Flexible Independent Travel) market.  Maybe next time I’m planning a family vacation I’ll seek out a travel agent to make my life easier.

I’m particularly concerned to see that newspaper reporter jobs made this list since I have a son who is an aspiring journalist.  Perhaps the growing proliferation of online news sources will boost job growth in that area.  That may be optimistic thinking, but you can’t blame a mom for hoping.

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Kathleen Madigan, The 10 Most Endangered Jobs (Or, Why You Are Reading This Online), Wall Street Journal, July 15, 2014.

Quick ways to get training for a ‘livable wage’ job

What are some relatively short (2-6 months) courses i can take to become certified in something that provides a livable wage?

A Reddit poster asked this question, and here are the top responses as of June 17.

1. Welding.
2. Hairstylist / Massage therapy, nail tech, aesthetician. / Culinary degree.
3. CPR instructor
4. forklift operator
5. GCODE, etc
6. TEFL certificate
7. Phlebotomy
8. deal table games like blackjack and roulette
9. driving semi trucks
10. HVAC-R

Not all these suggestions may sound appealing, but some of them do seem worthy of further exploration.  In looking at comments on the TEFL certificate idea, it appears that a college degree is almost always a prerequisite.

Related to suggestion #5 is the newly announced NanoDegree.

A Smart Way to Skip College in Pursuit of a Job

Udacity-AT&T ‘NanoDegree’ Offers an Entry-Level Approach to College

This week, AT&T and Udacity, the online education company founded by the Stanford professor and former Google engineering whiz Sebastian Thrun, announced something meant to be very small: the “NanoDegree.”

At first blush, it doesn’t appear like much. For $200 a month, it is intended to teach anyone with a mastery of high school math the kind of basic programming skills needed to qualify for an entry-level position at AT&T as a data analyst, iOS applications designer or the like.

This is another quick way to qualify for a “livable wage”.

… offering a narrow set of skills that can be clearly applied to a job, providing learners with a bite-size chunk of knowledge and an immediate motivation to acquire it.

It may not offer all the advantages of a liberal arts education, but it could offer a plausible path to young men and women who may not have the time, money or skill to make it through a four-year or even a two-year degree.

AT&T will accept the NanoDegree as a credential for entry-level jobs (and is hoping to persuade other companies to accept it, too) and has reserved 100 internship slots for its graduates. Udacity is also creating NanoDegrees with other companies.

The hardest part is finding the motivation and persistence to follow through.  All these options require a motivated person willing to put in the hours needed to obtain the skills and certification.  The short time span is an advantage here, certainly compared to the four-plus years needed for a bachelor’s degree.

Another challenge is to avoid taking on crippling student loan debt, so students must be careful about choosing schools that offer a good value.

Related:  “Should we go back to more vocational high school options?” (Cost of College)

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Eduardo Porter, “A Smart Way to Skip College in Pursuit of a Job”, New York Times, June  17, 2014.

What will happen when computers can handle most white-collar jobs?

Computers may soon be able to do white-collar jobs meant for college graduates.

Noriko Arai of the Todai Robot Project explains how the future is shaping up.

… a machine should be capable, with appropriate programming, of doing many — perhaps most — jobs now done by university graduates.

With the development of artificial intelligence, computers are starting to crack human skills like information summarization and language processing….

How would college graduates be affected by this technological evolution?

There is a significant danger, Ms. Arai says, that the widespread adoption of artificial intelligence, if not well managed, could lead to a radical restructuring of economic activity and the job market, outpacing the ability of social and education systems to adjust.

Intelligent machines could be used to replace expensive human resources, potentially undermining the economic value of much vocational education, Ms. Arai said.

“Educational investment will not be attractive to those without unique skills,” she said. Graduates, she noted, need to earn a return on their investment in training: “But instead they will lose jobs, replaced by information simulation. They will stay uneducated.”

In such a scenario, high-salary jobs would remain for those equipped with problem-solving skills, she predicted. But many common tasks now done by college graduates might vanish.

Mostly good or mostly bad?

…  A recent study published by the Program on the Impacts of Future Technology, at Oxford University’s Oxford Martin School, predicted that nearly half of all jobs in the United States could be replaced by computers over the next two decades.

Some researchers disagree. Kazumasa Oguro, professor of economics at Hosei University in Tokyo, argues that smart machines should increase employment. “Most economists believe in the principle of comparative advantage,” he said. “Smart machines would help create 20 percent new white-collar jobs because they expand the economy. That’s comparative advantage.”

Others are less sanguine. Noriyuki Yanagawa, professor of economics at Tokyo University, says that Japan, with its large service sector, is particularly vulnerable.

“A.I. will change the labor demand drastically and quickly,” he said. “For many workers, adjusting to the drastic change will be extremely difficult.”

Smart machines will give companies “the opportunity to automate many tasks, redesign jobs, and do things never before possible even with the best human work forces,” according to a report this year by the business consulting firm McKinsey.

Many business leaders dismiss a takeover by machines as “futurist fantasy”.

… Gartner’s 2013 chief executive survey, published in April, found that 60 percent of executives surveyed dismissed as “‘futurist fantasy” the possibility that smart machines could displace many white-collar employees within 15 years.

“Most business and thought leaders underestimate the potential of smart machines to take over millions of middle-class jobs in the coming decades,” Kenneth Brant, research director at Gartner, told a conference in October: “Job destruction will happen at a faster pace, with machine-driven job elimination overwhelming the market’s ability to create valuable new ones.”

Will these changes create a future of leisure and “self-realization”?

Optimists say this could lead to the ultimate elimination of work — an “Athens without the slaves” — and a possible boom for less vocational-style education. Mr. Brant’s hope is that such disruption might lead to a system where individuals are paid a citizen stipend and be free for education and self-realization.

“This optimistic scenario I call Homo Ludens, or ‘Man, the Player,’ because maybe we will not be the smartest thing on the planet after all,” he said. “Maybe our destiny is to create the smartest thing on the planet and use it to follow a course of self-actualization.”

It sounds too good to be true.  Although the concept of a future as an “Athens without the slaves” has its appeal, it sounds too fantastic to believe.  I wonder what will happen to the segment of the population that lacks the highest level of problem-solving skills.

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Michael Fitzpatrick, “Computers Jump to the Head of the Class”, New York Times, December 29, 2013.

Best growth outlook is for low-paying jobs

The outlook for jobs does not hold up much hope for some college graduates.

Elder care and other low-wage jobs will be among the fastest growing career fields over the next decade. Postal carriers and journalists might have a harder time finding work.

The fastest growing job for the next decade requires no formal education and pays an average annual income of $19,940.

Personal-care aide will be the fastest growing job from 2012 to 2022, among categories with more than 25,000 positions, the Labor Department said in a new report. The field will grow by nearly 50% to 1.8 million jobs.

The gloomy prospect for postal workers and reporters is directly tied to technology advances.  Email has replaced most paper letters, and the rise of robo-reporters has cut into the need for human writers.

Postal and media sectors are likely to shed jobs in the next decade.

Employment among U.S. Postal Service workers is expected to decline 28%.Reporter and correspondent jobs will contract nearly 14%.

Here’s a look at journalism jobs pulled from the Wall Street Journal “sortable table of the career fields that will grow and shrink in the next decade”. 

Since my college kid is seeking a job in journalism, I had a brief panicked moment before I realized the job levels are reported in thousands!  Maybe I can find slight comfort in looking at jobs with even fewer projected job openings, such as film editors, high school history teachers, and chemical engineers.  However, in terms of expected percent changes for jobs requiring a college degree, journalists rank right at the bottom of the list.

Investment bankers will be allowed to take it easy one weekend every month

Investment bankers will be getting more time off, according to an email newsletter from eFinancialCareers.

Jeff Urwin, global head of investment banking at J.P. Morgan, has confirmed reports that the bank will indeed introduce “protected weekends,” where analysts and associates are barred from even entering the office during one weekend every month.

Wow, one whole weekend free from work.  How rare is that for anyone nowadays?  But wait, you don’t need to be in the office to work.  You can sneak in a little deal-making by working remotely.  I’m sure some of the more competitive bankers will continue to be productive every weekend even if they’re banned from the office.

More hiring will be needed.

But that’s not all. Urwin also reportedly told employees that J.P. Morgan will hire roughly 10% more junior investment bankers in 2014, likely due, at least in part, to the need to fill in the gaps created by the protected weekends. No matter what the cause, J.P. will extend more employment offers in the coming year.

A good sign for job growth?

Both of JPM’s moves fall in line with those made by Goldman Sachs, which also announced it would be dialing back the workload thrust upon its junior workers and will hire more in 2014.

Whether they want to or not, other banks will surely need to follow suit. Goldman and J.P. Morgan didn’t make these decisions out of the kindness of their heart. They did it because the pay at the junior level isn’t what it used to be and talented people are getting burned out and leaving the profession early. Or worse, they are heading to Silicon Valley before ever step foot in the building.

Related:

• Working hours: Has Bank of America turned into Goldman Sachs? (eFinancialCareers)
• Long hours may explain why educated women quit the workforce – ‘the time divide’ (Cost of College)

The jobs gap between college and high school graduates continues to grow

College graduates continue to fare the best in this feeble economic recovery.

College graduates claimed the bulk of last month’s job gains, while high-school grads with no college lost jobs, highlighting a persistent divide in the recovery.

While both groups have seen improvements in unemployment rates, 3.4% for college grads and 7.3% for high school grads with no college, there is general agreement that progress has been slow.

Underemployment is a problem.

… Of course, though college grads are getting the lion’s share of the jobs, it doesn’t mean those are good jobs. Overall employment gains have come from lower wage jobs, with many graduates underemployed.

The divergence in jobs growth is clear.

Among all segments of workers sorted by educational attainment, college graduates are the only group that has more people employed today than when the recession started.

The number of college-educated workers with jobs has risen by 9.1 percent since the beginning of the recession. Those with a high school diploma and no further education are practically a mirror image, with employment down 9 percent on net. For workers without even a high school diploma, employment levels have fallen 14.1 percent.

Related:

• Why parents push their kids to go to college (Cost of College)
• College-educated households are gaining in economic clout (Cost of College)