I want to commend your attention to an article at Quartz by Gwynn Guilford for which the title of this post is a summary:
The numbers tell one story. Unemployment in the US is the lowest it’s been in 50 years. More Americans have jobs than ever before. Wage growth keeps climbing.
People tell a different story. Long job hunts. Trouble finding work with decent pay. A lack of predictable hours.
These accounts are hard to square with the record-long economic expansion and robust labor market described in headline statistics. Put another way, when you compare the lived reality with the data and it’s clear something big is getting lost in translation. But a team of researchers thinks they may have uncovered the Rosetta Stone of the US labor market.
Read the whole thing. This situation has not been lost on the Germans who characterize our strategy of maximizing the number of minimum wage jobs as “the American model”. How has this occurred?
- Decline in primary production
- Decline in manufacturing jobs
- Increased trade with countries without enforced health, labor, or safety standards
- Immigration, particularly illegal immigration
- Outsourcing, both onshore and off
That doesn’t just have serious implications for the economy as the author points out. It has serious implications for our politics and government as well. Just as one example when most jobs don’t kick enough into the Social Security system to pay for the retirement benefits, it puts an inevitable strain on the entire program.
We are presently at a fifty year low in unemployment and nearing a fifty year low in job quality.
“We are presently at a fifty year low in unemployment and nearing a fifty year low in job quality.”
But the wealthy among us have a higher share of total wealth and income. And now we have tons of articles and TV programs dedicated to telling us that we cant do anything to affect the wealthy since it will harm us all.
So, I dont really know if policies aimed at reducing inequality by taxing the wealthy more will help, but what I think is really clear is that policies aimed at making the rich richer have not made things better, except for the wealthy.
Steve
Trade, collapse of union power, the price bargaining power large retailers have over suppliers. (Walmart and Aldis negotiated Dean’s foods into money losing cost structure). Amazon just ordered 100,000 new electric deliver vans. $15/ hour part time only. (I checked).
People are working yes, and collecting Snap benefits to feed the kids.
Corporations will have to deal eventually with a socialist President if they won’t compensate workers. Gig economy is a joke.
Changing that via the tax code has not been successful in changing that in the past anywhere.
I’ve made my suggestions here repeatedly: breaking up large companies, imposing Pigouvian taxes on goods imported from abroad in the amount of the cost of health, safety, and labor law up to our standards, and limitations on immigration. A problem I don’t know what to do about is overcoming the aversion of the “creative class” to primary production. If it were accompanied by an aversion to primary production elsewhere, too, I could see it but the aversion seems to be doing it here in the United States.
At any rate we’ve had at least three decades of policy aimed at boosting the incomes and prospects of about the top third of the populace. What do you do with the people who can’t graduate from college? That’s at least half the people.
Apple CEO in Austin Tx @ groundbreaking of new facilities said he sees no path to moving assembly of the I Phone from China because 20 percent of sales are there. Left unsaid but understood is the Chinese ultimatum, assembly here, share technology, or kiss those sales goodbye.
In that environment, the US needs to twist some arms themselves.
Pigouvian taxes won’t cut it. We need import quotas low enough, actually zero for many products, to force the return of manufacturing to the US. We need to stop immigration and expel the illegal already here. Close the Mexican border, fence it, mine it, and put the Army on the border.
We also need to rebuild the labor movement. We need a political party that supports American workers. Neither the Democrats nor the Republicans support American workers. For that matter, neither do the socialists/communists. They are given over entirely to racialist politics and care nothing about economics.
Wages prices will increase. Free trade and open borders push American wages and prices to the global mean. Opioid and meth addiction and falling life expectancies are another result of free trade and open borders.
On average goods manufactured in the U. S. are 5% more expensive than those manufactured in China. That’s it. Some of that is lower labor costs, some advanced manufacturing techniques, some is FDI, the rest is export subsidies, currency manipulation, and differences in health, environmental, and safety regulations.
The 5% difference in costs isn’t the right metric. It is profits. Companies in China are making big profits so they dont want to move. I think people still persist with China is evil and China doesn’t compete fairly, which might be true, but US companies still want to do business there because they make money. Also, even if we manage to move some stuff out of China it doesn’t mean that it automatically comes back to the US. There are other places manufacturing can go and potentially maintain higher profits rather than come back to the US.
https://www.forbes.com/sites/kenrapoza/2019/08/30/us-companies-china-unfair-but-we-dont-really-care/#2ae2cc954adf
Since the topic of he post is jobs, if we do brin g back manufacturing from China, meaning we convince US companies to return somehow, we should remember it won’t mean that many jobs since we need higher productivity, ie automation.
Steve
To clarify, Amazon’s delivery jobs are not bad jobs, but you’d need two like that to get by financially.
Amazon’s going directly at UPS and Fedex. UPS is Teamsters and Fedex is contracted owner-operators who also hire part-time delivery drivers at $15/Hr.
How many people are willing to live on $30,000/Year? Well, we’ve already learned men did not rise up in arms when rising prices and pay cuts forced them to hire out their wives to work for wealthier people.
They won’t revolt on the streets but the ballot box is another matter.
That’s why the young support Sanders.
I think you’ve got it almost right, steve, but not completely. IMO a big reason that companies continue to do business with China is that they think they can avoid risk that way. That view has been shaken but it’s still holding on. There are other ways to further upset that belief. For example, any company that has their manufacturing done in China could be deemed ineligible to bid on government contracts.
‘The numbers tell one story.”
“People tell a different story.”
Comparing statistical evidence with anecdotes and coming to a conclusion as a result is journalistic malpractice. Besides what’s considered a bad job is quite subjective and extremely dependent on whoever is asking the question or writing up the survey. What survey(s) are cited as proof of ‘more bad jobs’? What metrics do these surveys measure? How are they measured? Etcetera, etcetera. More evidence needs to be provided before the assertion that this article makes can be trusted.