We are the greatest city,
the greatest nation:
nothing like us ever was.
Two hundred years ago 90% of all men everywhere were farmers. That had been true for a long time and even as late as the 1900 federal census that was true in the United States. Two hundred years ago in England there was a political movement among artisanal weavers called “the Luddites” (allegedly after Ned Ludd, a kid who smashed two stocking frames, knitting machines, in the 18th century). The Luddites feared for their livelihoods, worried that they would be replaced by low-waged workers using machine-driven looms. At one point the Luddites were powerful enough that they actually clashed with the British Army.
Over the period since the Luddites destroyed stocking frames and French saboteurs threw their wooden shoes into the new Jacquard looms (from sabot, a wooden shoe), the machines have improved people’s life spans and quality of life enormously, more food is being produced on less land and with fewer inputs than ever before, and only about 1% of Americans are farmers. Despite the low number of farmers, unemployment remains remarkably low.
Recently, a number of people have begun to wonder whether slow job growth not only in the United States but in much of the developed world means that we’ll never have robust job growth ever again. They are, in essence, echoing the Luddites’ concerns. Add Paul Krugman to that list. I won’t link to his recent column, Sympathy for the Luddites, because I’m reluctant to link to anything behind a paywall but you can find it easily enough. Megan McArdle is similarly worried:
Paul Krugman has a column today on a topic you don’t normally get much of from economists: sympathy for the Luddites. Back in 2001, when I sat in on my last formal economics class, this was about as daring a proposition as “Sympathy for the Devil” was as an album title.
A dozen years on, I don’t think it’s quite so edgy. I’d guess that Paul Krugman of 2000 would probably have given short shrift to the idea that we should listen to Luddite complaints. So would Megan McArdle of 2000. Both the later versions, much to my surprise, seem to have changed their minds.
What’s happened in the intervening ten years? Some of my more dour readers suggest it’s the fact that I’ve moved to Washington. But I moved to Washington from Manhattan, hardly a bastion of free market sentiment. And besides, I haven’t stopped thinking that markets are the best way to handle voluntary cooperation.
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The problem is that all the proposed solutions ring hollow. Until roughly the last five years, it was possible to believe that education would be the solution: send more kids to school, retrain people for new jobs. But college graduates aren’t finding it so easy to obtain solid employment either. It’s true that having a college diploma is still much better than not having a college diploma, but that doesn’t mean that by sending more kids to school, we’re actually making the workforce more productive, much less mitigating the problem of economic change; we may just be forcing people to jump over a higher bar to gain access to a shrinking number of jobs. Paul Krugman points out that these days, highly educated workers still have to fear having their job disrupted.
And retraining only works to a point. For my forthcoming book, I interviewed a Danish photographer facing a career crisis. Could he take advantage of Denmark’s generous retraining programs, I asked? He was glum. Your forties are a bit late to be tackling a whole new career; the payoff to investing years in education is simply inherently lower than it is in your twenties. Besides, he had a new baby. What would he and his wife live on while he spent a few years in training?
Paul Krugman’s solution, a stronger safety net, is equally unsatisfying. I’m not arguing for or against a safety net here; I’m just pointing out that it won’t do as an actual substitute for the majority of the population having jobs.
For starters, it is politically difficult to imagine a really large class of people who simply permanently live off the state. The safety net is rooted in human instincts about reciprocal exchange. Of course, it isn’t all that reciprocal–the majority of people who are net taxpayers are extremely unlikely to collect much in the way of food stamps, TANF, or even unemployment insurance. Nonetheless, the moral arguments are founded in the premise that these benefits are for emergencies, and anyone can have an emergency. They will lose political support if you have one group of people paying taxes, and a different group of people who can expect to live their entire life on the dole.
I think that people who believe that high unemployment is inevitable and forever, like Lucy, have some ‘splaining to do. The number of jobs created per month in the U. S. has been at 175,000 for some time. If jobs are no longer being created, how can that be? If “good-paying jobs” (whatever that may mean) are no longer being created, how is it that hourly average wages continue to rise and the number of employees in sectors with good compensation continues to rise?
I agree that we aren’t creating jobs fast enough. I disagree with the explanation that’s being offered which IMO boils down to “we’re doing the best we can under the circumstances”. I find that a heartless rationalization. I think we’re doing the best we can given the policy preferences we’ve put into place.
I have eight nieces and nephews. They’re all in their twenties, all of them are employed at least part-time, and they all have jobs that didn’t exist a century ago. I can think of a hundred jobs that didn’t exist 100 years ago, 25 jobs that didn’t exist 25 years ago, and 10 jobs that didn’t exist 10 years ago. Here’s a list of some of the latter:
- Social Media/Online-Community Manager
- Elder-Care Services Coordinator
- Telework Manager or Coordinator
- Sustainability Manager
- Educational Consultant
- Search Engine Optimization Specialist
- Medical Biller/Coder
- Online Advertising Manager
- Talent Management Coordinator
- User Experience Manager
So, what jobs will be created ten years or twenty years from now? I have no idea but I genuinely believe that they’ll be there if we allow room for them. That’s the mistake we’re making now. Our policies are in deep conflict. We don’t produce a lot of jobs for people who can’t read or write English but we continue to encourage large numbers of non-speakers of English who can’t read or write to come here. We know that the jobs of the future will require, at the very least, the ability to read and write in English, numeracy, and basic computer skills and we don’t equip our children with any of those. We know that we’re importing too much but won’t act to reduce our largest import, oil. We devote billions to propping up industries that need to shrink. Our greatest single national problem is not enough jobs, we reduce the return to labor.
To change the outcomes, change the policies.
The woman named To-morrow
sits with a hairpin in her teeth
and takes her time
and does her hair the way she wants it
and fastens at last the last braid and coil
and puts the hairpin where it belongs
and turns and drawls: Well, what of it?
My grandmother, Yesterday, is gone.
What of it? Let the dead be dead.
This was a well thought out commentary, invoking even more questions and considerations as to what the future holds for us — or, more importantly, bringing to light problems or misinformation embedded in the employment dissatisfaction or malaise enveloping the country today.
A couple days ago we were talking to the owner of a local B & B. When I mentioned knowing his son, who was working as a waiter at a local cafe, he kind of grimaced saying, “Yeah, he graduated from college and then came back to figure out his life. Of course what can you expect with a Philosophy Degree?”
This Innkeeper’s son, like so many his age, have become recipients of expensive liberal art degrees, with no special training attached, flooding the market these days. For many, advanced education has become a socially ‘cool’ extension of high school, rather than a serious focus on training for adult careers. Consequently, when these 20-somethings finally enter the job market, it is impacted more by student debt rather than by real knowledge derived in order to get a good paying job. The root problem, IMO, is that the popularity of ‘theory-driven’ courses, often politically correct in their curriculum, has taken over the post K-12 education, especially in the millennial generation now struggling with attainment of meaningful or enduring employment.
Furthermore, the hand’s on instruction (wood-working shops etc), that used to be part and parcel of early mandatory education, has evaporated under the social progressive protocol of college prep for everyone. And, even more burdensome, has been the dilution of public school education by instilling so many socially correct, state mandated topics in the everyday diet of school children. No longer is the emphasis on the fundamentals of “reading, writing, and arithmetic,’ as much as it is on global warming, gay and women issues, racial discrimination and the like. And, there is relative little critical thinking being encouraged when presenting these topics, in as much as usually only one POV is rendered, creating more of an educational indoctrination rather than a palette of diverse ideas or ideologies.
In the midst of thinking about all of the above, my husband showed me a reproduction of an old book, originally published in 1909. It was a Gustav Stickley book detailing the architecture and furnishings of the American Arts and Crafts Movement. What was pronounced in Stickley’s writing was the need for structure and discipline when training youth for careers in designing and making furniture/homes for this era. There were perimeters set for quality, comfort, and looks. These guidelines were distinct and reassuring, defining what was needed for certain desired outcomes. We lack that today, in that what is being promoted is a feel-good, fuzzy, do-your-own-thing, with huge dollops of oftentimes unearned self esteem. And, if it doesn’t work out, government will be there with a large safety net to take care of your needs.
Basically, we have created our own state of affairs, in promoting a self-indulgent (sometimes worthless) educational climate, followed by a manually inept, disposable-inclined, progressively weaker and dependent society of people. It will not end well……
Things change. I hope you are correct. I am inclined to believe that things will get better. I happen to believe that it will take a long time.
However, everything is the same, until it changes. I tell all my new hires not to assume that doc salaries are going to stay as high as they are. On the macro level, I dont know that we should just assume that integrating large economies like India and China into the world’s economy will necessarily be painless for everyone, and we havent even really touched much of Africa. In the long run, I think this provides growth for everyone, but it could/has made the short run difficult.
We have managed to maintain our standard of living largely by running up debt. We just cant do that anymore. As you point out, we still have innovation, but is it fast enough to employ everyone, and fast enough for those jobs to pay well? None of this mattered so much when we were all farmers. It matters a lot now.
Steve
I guess the biggest thing I worry about is the future of unskilled and semi-skilled labor. Hopefully there is something more than fast food and retail.
The occupational drift is striking when you research genealogy as I’ve been doing recently. In my own family, among the Polish immigrants who arrived in late 19th century there were some skilled craftsmen (furniture makers) and semiskilled laborers (cement industry, stonemasons, and bricklayers.) My maternal grandmother’s branch tilted toward entrepreneurship- grocers and bar owners. Most of the others probably had been farmers but went into the coal mines and steel industry here.
Examining the census documents gives a human perspective to the data. All of those working class neighborhoods, and city tenement houses, filled with laborers. As the century progressed, lots of women went into the garment industry or worked as telephone operators. None of that is unexpected but seeing names attached to the data gives a different perspective. I find myself wondering what this century will look like in hindsight.
As existing products become cheaper, somebody will develop new products or services to be purchased with the surplus money. There are numerous services that I would like performed, but they do n0t exist or are too expensive.
I would like to have my windows washed. I would like to have the oil change company come to me. A car wash company could also have a mobile service. There are numerous product that could be sold through vending machines. Furniture could be modernized with any number of devices/gadgets.
Until human nature changes, humans with money in their pocket will always want more stuff, and there will always be somebody working on some way for them to spend that money. Some people with too much money to spend will lend money to other people to get more stuff.
If the above is not accurate, the US should stop pumping money into the economy. Additional money will never produce more jobs because more jobs will never be produced.
Manufacturing for this stuff follows cheap energy, and as @Dave Schuler has noted, engineering will be located where manufacturing is located.
I believe that if given a less bureaucratic overhang, more people could create small cottage type businesses, that, in turn, could be self-supportive. If done legitimately it could create individual pockets of employment, giving meaningful work for people, while supplying modest revenue to the government.
After all, people generally enjoy working for themselves in endeavors that are creative and craftsman-oriented. But, when you have regulatory burdens, calculated in 2008 of being approximately $10,500 per employee for businesses of less than 19 workers, it becomes a hardship for small businesses to function openly. Consequently, there tends to be a lot of under-the-table transfers of money between those producing an item and their customers. Just in my circle of friends/acquaintances alone, I know of a number of people doing cash business in this manner — non-reportable and giving them a respectable living in the process.
Even in organic farming, there has been a crunch of illogical regulations seemingly aimed at closing small farms down, rather than encouraging them to survive and prosper. Ironically, as people rail against big business, it is big business who has the resources to counter any number of stringent government demands, while the little guys fall by the wayside, or simply go underground.
In my POV, there are any number of solutions for priming the employment pump — most of which reside in decreasing the stranglehold of government regulations from the equation, creating a more desirable and equitable environment for the entrepreneur to get started and grow.
If the above is not accurate, the US should stop pumping money into the economy. Additional money will never produce more jobs because more jobs will never be produced.
Yeah, but creating jobs isn’t the point, and we all know it. It’s about propping up the big financial institutions so that those who own and run them can skim off some of the flow of cash.
I believe that if given a less bureaucratic overhang, more people could create small cottage type businesses, that, in turn, could be self-supportive.
I don’t see it happening. Where’s the money for people to BUY stuff? Out of my friends, only one of them isn’t feeling a cash crunch – and of those feeling the crunch, we’ve all been feeling it for almost six years now, or longer. There just isn’t that much money around for most people to afford to but anything but necessities. Unless they do something like sell-off one of the two family cars, and THEN you can go crazy and do something wild like buy a new cell phone. But that’s where it’s at. (And most of my friends are white collar, BTW.)
…
That’s the mistake we’re making now. Our policies are in deep conflict. We don’t produce a lot of jobs for people who can’t read or write English but we continue to encourage large numbers of non-speakers of English who can’t read or write to come here. We know that the jobs of the future will require, at the very least, the ability to read and write in English, numeracy, and basic computer skills and we don’t equip our children with any of those.
Our policies are in deep conflict only if you believe the people running the country aren’t trying to ruin the country for their own benefit. If you look at what they’re doing with the blinders off, it all becomes clear that they’re wrecking the country on purpose. And this runs across parties. In the last week, we’ve had Marco Rubio’s chief aides come out and state the Americans just can’t cut it any more, and therefore we must import Mexicans and give them the vote. Two of the “conservative” Supreme Court justices have now said that anyone c an show up and any polling place and pretend to be anyone and vote, and there isn’t squat that anyone can legally do about it. Jeb Bush has come out and crowed about how much more FERTILE poor Mexican immigrants are than white Americans, and that therefore we need to get rid of white people and replace them with Mexicans as fast as possible. (Haley Barbour concurred with this viewpoint.) And these are the conservatives!
The POLICIES of the nation are not in conflict with each other. They ARE in conflict with what the politicians occasionally say what they want for the nation. That would be what they say they want when they’re running for re-election, not what they say when they’re safely in office. (See Rubio as the best example of that.) Assume that they’re out to remake the country in the imagine of a third world cess pit, or Russia under Putin, and then the policies all make sense.
“saboteurs threw their wooden shoes into the new Jacquard looms (from sabot, a wooden shoe”
In best Johnny Carson: “I did not know that.”
“Our policies are in deep conflict. We don’t produce a lot of jobs for people who can’t read or write English but we continue to encourage large numbers of non-speakers of English who can’t read or write to come here. We know that the jobs of the future will require, at the very least, the ability to read and write in English, numeracy, and basic computer skills and we don’t equip our children with any of those.”
I think this is a major pillar in the problem. We encourage passivity, “all children are above average” instead of “its a bitch out there, win, baby” and make every excuse known to man for not taking risk, working hard or excusing failure to prepare in the name of kindness and caring.
I went from steel mill to small business exec to lender for leveraged transactions to principal investing in change of control transactions. It didn’t happen with a static skill or mindset. Look at the career paths previously cited by Michael or Dave. At least as eclectic or tortuous (pick to suit) as mine. Didn’t happen with a static mindset. Didn’t happen without intent.
Ice has a giant chip on his shoulder that I in a not insignificant way I agree with. The whole place – govt, financial and non-financial corporations – “big education” – is rigged now. IMHO its all driven by a large state. Set up a large and powerful state, run by pols who require powerful and money rich contributors who receive goodies for their cash and what do you expect? Jimmy Stewart? Throw in the Obamaphone mentality and its a mess. Why “progressives” don’t understand that one follows the other flummoxes me.
Ice has a giant chip on his shoulder
Next time I look back at the shattered ruin of my life I’ll make certain to smile about it and think happy-fun-time thoughts.
It is historical events like this one that makes me think that Michael is full of crap when he goes on and on about how iPhone apps are going to render all of us unemployed. We have seen technological innovation and progress destroy countless jobs. Nothing has destroyed more jobs, indeed entire industries have been decimated (how many people work caring for horses these days as a percentage of the population?).
Anyone who claims that unemployment is going to rise and rise and rise and never ever go back down should, in my opinion, provide a well laid out argument. Not some hodge podge load of bullshit they cobbled together after driving around Venice Beach in a Mercedes convertible after buying some Canalli slacks. Their argument should explain why “this time is different” and provide some sort of evidence in support of this.
This isn’t to say it can never happen or that things aren’t bad in terms of unemployment. But never is a damn long time and if you are going to make such an argument you better have a damn fine explanation with some damn fine evidence.
BTW Ms McArdle
Sympathy for the Devil is a song from Beggars Banquet, (and a horrible movie) not an album title.
Now how much cred can she have? 0-/