Two young men, both 23, came from the same undistinguished New Jersey town.

The first young man skipped college. He earned his welding certificate at 19. Today he has 5 years of experience, zero debt, and recruiters calling him about shipyard work in Virginia. His wage tripled in two years.

The second young man followed “the playbook” step by step. He hit the books hard, landed internships, and earned his physics degree from a Top 25 school. But he spends his days making lattes for sneering, sniveling office workers while launching CVs into the digital abyss, praying for a miracle like Roger Staubach chucking his Hail Marys.

For 30 years, everyone agreed the second kid was the smart one.

Finally, mercifully, the market disagrees.

The Numbers Don’t Blink

The Wall Street Journal just reported that Americans without college degrees are enjoying one of their best job markets in decades. Unemployment among workers aged 22 to 34 who never finished college has rarely been lower in 20 years, according to Burning Glass Institute data.

Incidentally, my friend and Daily Reckoning Grand Poobah Adam Sharp wrote a wonderful piece about his son starting his journey as an electrical apprentice. Read it here.

The credentialed cohort of the same age is living through one of its worst stretches since 2003. What blew my mind is that science and tech graduates are getting hit the hardest.

The New York Fed’s stats-by-major must read like a butcher’s bill for the present administration. Recent computer engineering graduates sit at roughly 7.5% unemployment. Physics graduates have 7.8% unemployment. Computer science grads run around 6.1%. Somehow, art history grads are at only 3%. Really.

Not all Science, Technology, Engineering, and Mathematics (STEM) graduates are suffering, though. Nursing graduates have about 1.4% unemployment. Civil engineering graduates are about 1%. Keep those two in mind, because they hint at what’s going on.

The Wrong STEM

America produced the wrong kind of scientists and engineers.

Of course, cheap money flows to whoever stands closest to the spigot. For the last 3 decades, the Fed’s unabated flow ran to Wall Street first, as always, and then onto Silicon Valley. So the talent went there. Bright kids who might have designed turbines or run refineries went off to optimize ad clicks and build food delivery apps. It also explains why so many physicists wound up on trading desks in New York and London.

That’s “Desk-STEM.” Things like software, apps, fintech, and ad tech. Those kids build bits, not atoms.

The credential machine responded to the price signal like any producer would. Universities cranked out computer science degrees. Parents pushed kids toward laptops. Nobody malinvested harder than higher education.

Then the signal changed.

AI started eating junior coding tasks. Hyperscalers invested trillions into chips and data centers, not graduate hires.

But it seems the country has woken up and noticed what it needs. And what it needs, lo and behold, are people who can build stuff.

The Bill Arrives

Here’s a non-exhaustive list of what America can't make anymore.

Ships. A leaked Office of Naval Intelligence slide put China’s shipbuilding capacity at 232x ours. That’s not 232% more. That’s 232 times as much. In 2024, China built over 1,000 commercial vessels. America built 8.

Credit: TWZ

Drones. By most accounts, Ukraine burns through more small drones in a month than American factories produce in a year. The commercial drone base that wartime production would ride on belongs to China's DJI.

Munitions. As my friend and colleague Byron King mentioned many times, China mines roughly 70% of the world’s rare earths and processes an even bigger share. The magnets inside precision-guided munitions pass through Chinese refineries. We can design the missile, but we can’t source its guts. America has plenty of rare earths, but right now they sit underground, uselessly.

Refineries. America hasn’t built a major new oil refinery since 1977. We pump crude and ship it abroad because we can’t process enough of it at home.

None of this happened because Americans got lazy or stupid. The system did what its incentives told it to do. Wall Street rewarded companies for shedding factories. The Swamp lauded America’s Grossly Deceptive Product (GDP), which counts a stock buyback the same as a shipyard. And the smartest kids followed the money into pixels and algorithms, because the money told them to.

Now that tab is due. The kid with the welding qualification is no longer holding a consolation prize. Now, he’s the prized recruit at the front line of American rearmament. The market figured that out before DC did, as it always does.

The Broken Rung

The second problem lies inside the first.

Even the engineers we do need can’t get trained.

Entry level jobs were never about output. They were paid apprenticeships. The junior engineer, the lab tech, and the first year analyst learned the trade by doing grunt work next to people who knew it cold.

Now, AI does the grunt work. The companies pocket the savings and skip the training. It looks brilliant on this quarter's earnings call.

But a nation that can’t apprentice its young builders doesn’t get master builders in 2040. That’s our seed corn, and we’re eating it. The barn looks full right up until planting season.

Wrap Up

If you spent 30 years watching the laptop class sneer at the people who make things, you probably sensed something was wrong.

After all these years, the repricing has started. Welders’ wages are climbing. Trade school enrollment is up. Defense money is flowing toward shipyards and foundries instead of consultants. The market is bidding up hands and marking down paper.

For your kids and grandkids, the lesson isn't “skip college.”

It's “Pick work that touches the physical world.”

Nursing. Civil engineering. Machining. Power. Process engineering. The degrees that will survive and be useful are the ones attached to atoms.

America built the arsenal of democracy once, with men who never saw a lecture hall. The talent is still here. The kids are already voting with their feet.

The country just has to keep paying them to build.

Have a great day ahead.