Creative Class

Here’s the abstract from a new paper by Ed Glaeser and Matthew G. Resseger (thanks to David Ptak for the pointer).

There is a strong connection between per worker productivity and metropolitan area population, which is commonly interpreted as evidence for the existence of agglomeration economies. This correlation is particularly strong in cities with higher levels of skill and virtually non-existent in less skilled metropolitan areas. This fact is particularly compatible with the view that urban density is important because proximity spreads knowledge, which either makes workers more skilled or entrepreneurs more productive. Bigger cities certainly attract more skilled workers, and there is some evidence suggesting that human capital accumulates more quickly in urban areas.

Full text is here.

The location decisions of graduating college students has interested me for years. The reason is simple: College grads are making a joint decision about what job to take, what labor market to enter, and what city to live in, so they provide an interesting lens into how these choices get made. And, because they are both highly skilled and highly mobile - three to five times lore likely to move than, say, a 45-year-old - the locations they pick are likely to leave a lasting imprint on our economic geography.

For the past several years, the Harvard Crimson has surveyed the graduating class. I’m the first to admit it’s a highly biased sample, but it’s also a very interesting one - tracking graduates from arguably the world’s leading university. As such, it provides useful signals about the kinds of jobs and the kinds of places highly motivated, highly mobile young talent is picking.

The results of earlier surveys were predictable. Harvard grads traditionally headed to consulting and investment banking jobs in NYC. But this year’s findings - coming as they are in the midst of the economic and financial crisis - evidence some different and interesting trends.

Still Getting Jobs: While stories about the worsening job prospects for college grads are legion, the economic and financial crises have not significantly altered prospects for Harvard grads. The survey found that 59 percent of students had jobs lined up prior to graduation down slightly from 66 percent last year. This is understandable since Harvard grads are headed into professional, knowledge, and creative occupations which have the lowest rates of unemployment and since they signal top talent.

That said, career choices are certainly shifting along some predictable and some not-so-predictable lines.

Finance and Consulting Fade: Far fewer grads are headed to finance and consulting. The figure has been consistently down over the past three years, actually - falling from 47 percent in 2007 to 39 percent in 2008 to 20 percent this year. The numbers of grads headed into finance fell from  23 percent last year to 11.5 percent this year, while consulting dropped from 16 percent to 8.5 percent.

Education and Health Care Gain: More grads are headed to education and health care. Education is up from 10 to 15 percent of grads. Health care increased from six to 12 percent.

Government Down, Slightly: Despite the conventional view that government work might become more attractive, the share of grads taking jobs in government fell slightly this year 4.5 to three percent. The Crimson suggests this is “a paradoxical trend given the Democratic victories in the 2008 elections and the fact that 74 percent of Harvard seniors describe themselves as more liberal or considerably more liberal than the average American.”

I think it’s more predictable. Having taught public policy students for the better part of three decades, I’ve seen a long-running trend away from traditional government work which is perceived as overly hierarchical and bureaucratic. Public service and cause-oriented students I’ve come across prefer work in smaller scale, more flexible non-profits where they believe they can have more immediate impact. The Crimson reports that “programs like Teach for America… received applications from a record-setting 14 percent of Harvard seniors, according to data released by the organization.”

What They Really Want to Do: I found this question to be the most interesting in the survey. When grads were asked “what career they would choose if finances were not a concern,” the number one field was the arts, with 16 percent choosing it as their “dream field,” followed by public service (12.5 percent) and education (12 percent). Finance and consulting dropped to five percent each.

Top Cities: Check out the great map below. The greater Boston area is the top destination - reinforcing the point that having an elite university (or more) in your local backyard can be a considerable talent advantage. And since after-college moves are the pinnacle of mobility it can be a lasting one. Cities might do better by focusing a little bit less on luring “ex-pats” back home, and a little more on retaining the college grads that have already chosen them.  New York has fallen from its previous top spot. D.C. is down just a tad - even with the new heavily Harvard Obama administration and the southern shift in the nation’s financial and economic nerve center. Small percentages are headed to the South or the Midwest, with Chicago drawing just 1.3 percent of grads. Seventeen percent of grads are going abroad - which may be taken as a signal of a shrinking U.S. and improving foreign opportunities but which I view as a very positive sign for the future.

Manpower CEO, Jeff Joerres talks to the Financial Times about the crisis and the possibility of a new brain drain in the U.S. and Europe.

Mr Joerres says opportunities in the developing world could prompt a “brain-drain” from America and Europe that could exacerbate the talent shortage.

“It’s not just Irish going back to Ireland or Indians going back to India,” he says. “It’s Americans saying: ‘Mumbai is not so bad and when I go there I get a standard of living that’s acceptable to me’. You’ll see more of that.”

In a reluctant foray into politics, Mr Joerres says the U.S. is shooting itself in the foot by having too low a limit on the number of non-immigrant visas it issues, meaning that the work permits tend to run out by May every year. “That’s just wrong,” he says. “The growth of this country came from people who were not American but were classically American - who came here from another country with an idea, developed it and created employment. Two-thirds of Silicon Valley companies were started by people not born in the U.S.

“We were so arrogant about being able to capture the smartest people in the world because we were the best alternative. But there are a lot of other neat alternatives right now. Go to Shanghai, Dubai, Qatar, Abu Dhabi - that’s who the U.S. is competing against. We’re competing against the nightlife and the energy in Mumbai and Bangalore.

“This is a global labour market,” Mr Joerres adds. “If you see migration back to Mexico, India, China, some of the western countries could be really adversely impacted by a brain-drain that they didn’t quite anticipate.”

We know that economic crises are periods of accelerated innovation and creative destruction, but they can also radically reshape the global flow of talent. Europe’s economic difficulties and relative closure during the previous two major economic crashes - the Long Depression of the 1870s and the Great Depression of the 1930s - helped pave the way for the U.S. to achieve its global talent advantage. We may be seeing the beginnings of another shift today - less toward nations and more toward thriving mega-regions. One thing is for sure: The global competition for talent promises to get more heated as we move from crisis to recovery. The places that can attract the most capable and broadest array of talent will gain considerable long-run competitive advantage as that happens.

Jon Rauch draws a connection between introverts and bloggers (via Andrew Sullivan):

I suspect a lot of bloggers may be introverts, because blogging is great if you like to sit in front of the internet all day. If not for my aversion to specializing in one subject, I probably would have been an academic historian, because I think it would have suited me to work in libraries back before there was an internet.

So I asked Cambridge personality psychologist Jason Rentfrow about it:

I would be inclined to think that Openness would be a big predictor of blogging because it’s related to curiosity and reflection… But just as my work on music and entertainment preferences indicates that personality is related to preferences for particular content, I would imagine personality is related to the content of people’s blogs.

Rentfrow sent along a link to this study on bloggers and personality:

We examined whether the Big Five personality traits predicted blogging. The results of two studies indicate that people who are high in openness to new experience and high in neuroticism are likely to be bloggers. Additionally, neuroticism was moderated by gender indicating that women who are high in neuroticism are more likely to be bloggers… The results indicate that personality factors impact the likelihood of being a blogger and have implications for understanding those who blog.

As for Rauch, his being wary of over-specialization leads the armchair psychologist in me to believe he is likely to be high in openness-to-experience as well as being an introvert. Highly creative people frequently share these sorts of personality traits. Like The Economist, I’d place him way up on the spectrum of creative people, which the leading psychologist of creativity describes this way.

Yesterday, The New York Times had one of the most frightening articles I have ever read.

In what I think is one of the most perverse misuses of our creative talent that I have ever heard, President Obama is launching a massive Reagan-like Cybersecurity Cold War that has the military-industrial complex salivating. This is expected to soak up the trained computer scientists from Silicon Valley and put them into super-secret R&D.

Instead of creating value for the global economy, they will now be sequestered in high-security laboratories where the knowledge they create will only slowly, if ever, leak out to the commercial world. Mind you, this initiative is being pushed while Harvard and many other universities are considering firing tenured faculty. If a massive military cybersecurity program is the change that the current administration believes is going to assist the U.S. economy in overcoming the worst crisis of the last 75 years, then the future for us and our creative class is likely to be grim indeed.

It is my belief that openness, information exchange, and creating value for the consumer has been the hallmark of U.S. success and what made us a beacon for brilliant people from around the world. By taking some of best and brightest and sequestering them in laboratories shrouded in secrecy, we are taking a deliberate step in the wrong direction.

Can a creative economy be built on directing resources in such directions?

A blogger says the issue is more class than gender:

Men have worked as essentially shop keepers and store clerks for a lot longer than they have worked on assembly lines. There have been waiters forever. Lawyers are the world’s second oldest profession. Teaching was a male-only profession for centuries.  The idea that men are and ought to be unreflective, grunting, two-fisted louts is a class thing not a gender thing and it is imposed upon working class men by a system that needs them to be beasts of burden.

Men who reject certain values and behaviors as “sissy” or “girlie” are rejecting success, and don’t think their bosses aren’t grateful.

His point hit home with me.

When I was a young boy, my father would often take me with him to Newark on Saturdays to buy “Italian Bread.” We would inevitably pass by a neighborhood “beauty parlor” where my father would stop for just a minute. “Richard,” he would say, “I was so dumb. When your aunt (his older sister) moved to California, she wanted to give me this place. I could have made it work. I enjoy cutting your hair and coloring your mother’s. But when I was young, beauticians were considered ’sissies.’ So I let my pride take over. Instead of having my own place, being my own boss, and doing something enjoy, I stayed in the damned factory.”

The economic crisis is hitting hardest at working class jobs, and rates of male unemployment have skyrocketed. A commonly asked question is, how do we retrain them for emerging job opportunities in other sectors? The Globe and Mail’s Margaret Wente suggests the problem runs a whole lot deeper than we think.

The new economy (over the long term) is creating tons of service jobs in retail, customer support, and personal care. The trouble is that these jobs require temperamental attributes that are stereotypically feminine - things like patience, a pleasant demeanour, deference to the customer and the ability to empathize and connect. Another way to put it is that these jobs require emotional labour, not manual labour. And women, even unskilled women, are much better at emotional labour than men are …

This identification of masculinity with hard physical work (no empathy required) is deeply embedded in the history of the human race … But no matter how much education and retraining we offer, we are not going to transform factory workers and high-school dropouts into customer-care representatives or nurses’ aides any time soon. It’s their wives and daughters who will get those jobs …

In the new world of work, the old values of working-class men are an anachronism. And what we are really asking of them is not to retrain or upgrade. We are asking them to abandon their very idea of masculinity itself.

She’s right. I grew up in that culture. My father worked his entire life in a factory. I spent my high-school summers doing factory work. Sexism and racism ran rampant. Fights were almost everyday occurrences; working class disagreements almost always end in them. When a Garden State scholarship enabled me to attend Rutgers, I was floored by the relative safety, meritocratic orientation, and personal freedom afforded by middle-class culture. Sure, modern middle-class culture has plenty of faults. And certainly not all working-class men share these retrograde attitudes. Many workers in more modern, high-performance factories (a good deal of whom are women) would fit nicely into service or professional work. Still, that old blue-collar male culture remains too much a fixture in too many places.

The demise of high-paying blue-collar jobs and the economic devestation it means for families and and communities is tragic. But the demise of that old-school working-class male mind-set is not something to be sad about.

Google has developed a nifty new algorithm to identify employees who are most likely to leave the company. Discoblog explains:

Performance reviews, pay raises, promotion histories, and other data on its 20,000 employees were crunched into yet another mathematical formula, which reportedly spat out the names of who was most likely to quit.

No surprise, Google insiders are keeping quiet about the details of the algorithm, though they will say that it has already “identified employees who felt underused,” a key precursor to telling your boss to shove it. Meanwhile Laszlo Bock, the company’s head of HR, told the Wall Street Journal that the algorithm helps the company “get inside people’s heads even before they know they might leave.”

Perhaps it’s fashionable to bash uber-successful companies. I visited Google twice for book talks  - once at their Silicon Valley headquarters, and also at their NYC office. I’ve been to a lot of high-tech companies, leading-edge manufacturing plants, and the trendiest of creative enclaves, but Google still blew me away. The digs were great, and employees (at least the ones I met) appeared smart, challenged by their work, and genuinely engaged in what they were doing. Not to mention, the algorithm seems pretty useful and reasonable to me.

The New York Times asks artists how the recession is affecting their lives and work (h/t: Alison Kemper). Money quote:

“I love it. The only thing that makes me sad is that I can’t make a living right now.”

While the responses comprise a small, ad hoc sample, my read is that the artists in major centers like NYC and San Francisco seem more upbeat than those in harder-hit Rustbelt communities.