About Me

When not at work with students, I spend my time in my room either reading, calculating something using pen and paper, or using a computer. I read almost anything: from the pornographic to the profound, although my main interests are mathematics and physics. "When I get a little money I buy books; and if any is left I buy food and clothes." -Erasmus

Thursday, September 1, 2011

Of Nursing and Bubbles

The Philippines has an oversupply of nursing graduates; I've heard stories of nursing grads having to pay hospitals so that they can do "volunteer work" just so they can gain necessary experiences.

A few years ago, I had an idea that there would be a glut-- a simple count of hospitals and expected nursing graduates would have given the game away, and I didn't expect demand from abroad to leave salaries at high levels after the inflow of many new nurses. About six years ago, there was a shortage of nurses, and this shortage meant large salaries.

Parents who saw those salaries didn't think about supply and demand-- and given that a nursing degree takes about four to five years, this means that by the time nursing freshmen graduate, the marketplace would be  much changed from what initially led people to take up nursing.

This reminds me of bubbles in financial markets. A famous example of a bubble is the Dutch tulip mania. Charles Mackay gave an account in Extraordinary Popular Delusions and the Madness of Crowds. (A wikipedia article on Tulip Mania is here.)

A relatively recent example of a bubble was in the nineties, when people kept buying technology-related stocks (even when the underlying businesses were lousy-- no earnings, etc) because people convinced themselves that good times (an upward trend in the prices of stocks) will last forever. (They don't.)

Due to higher stipends and an increase in the number of DOST scholars, we've been getting wonderful students in our research group, and I now worry about their employment prospects.  I think that the openings for tenure track positions will be available only within the next three to five years. Given the increasing PhD graduation rates at NIP, there's probably a coming shortage of available academic tenure-track work.

The same thing can be said for geology and chemical engineering. Right now, the employment opportunities look good. For new geologists with a BS degree, the monthly take-home pay starts at around PhP 70 K.(USD 1.7 K, a decent amount if you spend it in the Philippines.) DOST has encouraged the inflow of new geologists by increasing stipends, and I can see that there are larger numbers of geology majors compared, say, to a few years ago. What this means in terms of salaries is an eventual decrease in take-home pay.

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