Belt tightening in the corn belt.
According to this CNBC article, some states are cutting finding for tech and medical courses. I can see that. Makes sense to me.
See, there is indeed a need for these sorts of graduates, but business doesn't want to pay for them. I get so tired of reading another 'USA doesn't have enough engineers' story and yet, the same newsies ignore the basic causes, low pay and hard courses. If there's a need for certain skills, the pay scale should rise. But it doesn't in the USA.
Why not?
It's because of the screwed up way our companies are run. In the 1960s and earlier, a company's stock value was set by actual achieved profits and the resulting dividends. Stock trades were only possible for the big investors who could afford the investigators and analysts needed and the trader's fees, things the little guys couldn't. But along came no-load mutual funds and small investor oriented trading companies and even a little guy could get into the market no matter how naive.
Today the value of a stock is mostly set by perceived 'glamor' and hoped for future value, not actual performance and hence dividends. The job of the CEO, as far as the major share holders are concerned, is to enhance these. It doesn't matter much if the company can't make a profit. The canny major investors can see the writing on the wall in time to get out, leaving the newbies and the credulous holding the bag when the stocks fall. Without dividends, the stock market has become a zero-sum game.
It's very easy for a CEO to manipulate this perceived value of his company, just have a great PR campaign about a new product then sit back and let the developers struggle to make it happen. If they can't get the product designed, it's no skin off his butt. He's done his job, made the stock price spike on schedule. He's more inclined to starve the developers of cash since R&D has always been a money pit. And if they actually do get a design out the door, then he gets another set of headaches, rounding up the cash to start production and then fretting over actually selling the things. None of these do good things for the quarterly reports. Better to never have a new product as far as he's concerned. In the three or four years it takes for this policy to hurt the company, he's probably found another berth at another competing company. And the big investors on the board of directors that put him in the old company are gone too and have green lighted him at the new place. Many are on the the new company's compensation board. As long as the guy can make the stock spikes on schedule, he's golden.
Here in the midwest these seagull CEO's also move the head office to a coast, east or west. They want an upscale lifestyle, one the midwest can't provide. It puts them near future possible employers too. It's all win for him. So what if half the engineers stay behind and quit? It's all sauce for his bottom line.
So the developers don't have the money to pay more for engineers. And the students see this. Enrollments go down. Eventually the states have to look at where the money is going, where the graduates are going and if it's not to the state's benefit, cut the funding. Engineering graduates don't stay in Nebraska, or Missouri, or Kansas. They end up in San Jose or Seattle or the east coast. So it makes sense for them.
And medical students? If they graduate, they aren't sticking around either. Better pay on the coasts. It's that or work changing old folks diapers at the rest home.
See, there is indeed a need for these sorts of graduates, but business doesn't want to pay for them. I get so tired of reading another 'USA doesn't have enough engineers' story and yet, the same newsies ignore the basic causes, low pay and hard courses. If there's a need for certain skills, the pay scale should rise. But it doesn't in the USA.
Why not?
It's because of the screwed up way our companies are run. In the 1960s and earlier, a company's stock value was set by actual achieved profits and the resulting dividends. Stock trades were only possible for the big investors who could afford the investigators and analysts needed and the trader's fees, things the little guys couldn't. But along came no-load mutual funds and small investor oriented trading companies and even a little guy could get into the market no matter how naive.
Today the value of a stock is mostly set by perceived 'glamor' and hoped for future value, not actual performance and hence dividends. The job of the CEO, as far as the major share holders are concerned, is to enhance these. It doesn't matter much if the company can't make a profit. The canny major investors can see the writing on the wall in time to get out, leaving the newbies and the credulous holding the bag when the stocks fall. Without dividends, the stock market has become a zero-sum game.
It's very easy for a CEO to manipulate this perceived value of his company, just have a great PR campaign about a new product then sit back and let the developers struggle to make it happen. If they can't get the product designed, it's no skin off his butt. He's done his job, made the stock price spike on schedule. He's more inclined to starve the developers of cash since R&D has always been a money pit. And if they actually do get a design out the door, then he gets another set of headaches, rounding up the cash to start production and then fretting over actually selling the things. None of these do good things for the quarterly reports. Better to never have a new product as far as he's concerned. In the three or four years it takes for this policy to hurt the company, he's probably found another berth at another competing company. And the big investors on the board of directors that put him in the old company are gone too and have green lighted him at the new place. Many are on the the new company's compensation board. As long as the guy can make the stock spikes on schedule, he's golden.
Here in the midwest these seagull CEO's also move the head office to a coast, east or west. They want an upscale lifestyle, one the midwest can't provide. It puts them near future possible employers too. It's all win for him. So what if half the engineers stay behind and quit? It's all sauce for his bottom line.
So the developers don't have the money to pay more for engineers. And the students see this. Enrollments go down. Eventually the states have to look at where the money is going, where the graduates are going and if it's not to the state's benefit, cut the funding. Engineering graduates don't stay in Nebraska, or Missouri, or Kansas. They end up in San Jose or Seattle or the east coast. So it makes sense for them.
And medical students? If they graduate, they aren't sticking around either. Better pay on the coasts. It's that or work changing old folks diapers at the rest home.