Victim of Your Own Success Syndrome
Midland, Texas.
More oil gets drilled here than anywhere else in the USA.
And it’s lucrative. There’s a lot of money to be made. We’re talking about $100,000+ for risky jobs that don’t require a college degree.
Okay, but what happens if you have a non-oil business when oil gets discovered in Midland?
Suppose you have a warehouse that ships out packages.
You will never again be able to get labor.
Because anyone who can work in a warehouse can work in oil for 3-4x+ the warehouse wage.
The warehouse cannot work. It’s no longer competitive with the rest of the country; it must shut down.
I once spoke to a broker who moved from midland to a part of Texas without oil.
He told me the story of the general contractor who tried to build a building Midland.
He brought a crew of guys to build a building.
He lost the whole crew. As soon as they figured out that they could more in oil (a similarly risky job), they were gone.
He lost two entire crews from a different part of Texas before he gave up.
The oil industry in Midland is just big for the local economy. It’s like a vacuum that sucks up all the relevant talent.
Lawyers and accountants might not decide to become oilmen but if they’re in midland and they’re smart, they’re orienting their business to oil & gas.
All this is fine if you’re a flexible person and are okay with switching to oil and if you’re okay with the occasional earthquake caused by the shale drilling. When oil prices drop, grit your teeth and bear it!
The nice thing about oil though is that it can employ a lot of people AND a lot of different kinds of people.
Like I said, $100k and no degree for the oilman. And accountants and lawyers have stuff to do too. The “people people” locally can sell services to the oilmen etc.
But what happens when your winning industry isn’t like that? What happens when it’s not manufacturing planes or operating hospitals?
What happens when it’s finance?
The “people people” can become investment bankers and the lawyers & accountants can shift as well. The engineers can become quant traders but what happens to the no college degree oilmen? What do they do?
There’s not much for them to do. And sadly, finance just doesn’t need that many people. It’s not like manufacturing, oil, or healthcare.
And what happens if half the jobs in finance can be done remotely? What happens to your local oilmen now?
They’re flipping burgers.
We have become a victim of our own success.
Look at gdp. Looks great right?
But if you’re not in finance you don’t get a cut of that action. You’re stuck making burritos at chipotle for the finance bros who grace you with their presence and the occasional “wow it doesn’t matter to my finances but this burrito got expensive” social media post.
This type of thing creates a lot of problems for society because the people driving trucks, flipping burgers, running restaurants who get paid peanuts because they’re not in the chosen industry are really the backbone of the country.
And as long as finance is industry #1, it’s going to keep sucking up all the talent. People stop making products. They make assets instead. Look at twitter. Where is the money being made?
“But what about software!?”
The is America’s #2 industry and while it can’t serve the every day people like manufacturing planes can (remote work, no place for people who can’t get college degrees because they have a different type of intelligence), it’s also downstream from finance.
Yes there is a huge body of really talented people in this country and San Francisco more than anywhere else knows how to bang out a software company.
But don’t forget that Silicon Valley is mostly a bunch of finance bros betting with finance money on which company is going to be the best asset.
Finance.
So remember this, it’s relevant to your career and where you choose to live.
Choose the right place and industry for you talents or be the victim of your country’s “success”.
