Discussion in 'Too Hot for Swamp Gas' started by philnotfil, Jul 12, 2013.
On the bright side, we won't have that awkwardness of training our replacements?
It isn't hard to figure out what those FEMA camps are eventually going to be used for.
If by the middle class you mean the jobs that pay a "living wage" to put a nut on the end of a bolt, then yes. And it is no different than years past. What is really threatening the "middle class" in the US is the world economy. Too many hungry people out there to keep them from working a LOT cheaper than what the US workers expect.
What I am more dismayed about is that hiring in businesses can't discern between quality workers and crap these days - or the laws won't allow them to - and it is more of a lottery system of getting jobs that are middle class. Entrepreneurship is about the only avenue available, if the regulations don't kill it.
It is an interesting point and I think automation, which is massively increasing productivity while lowering the skill level required to perform many tasks is certainly a part in the labor market issues (the other, which te correctly pointed out, being globalization). Globalization is clearly taking much of the manufacturing jobs, but after that happened, the US became a service-based economy, as some of those jobs are not really capable of being moved overseas (call-centers being an obvious exception). Interestingly, the use of automation has had two effects on the service economy:
1. Lower and middle class service jobs are less important and can often be replaced by a machine. For example, many cashier jobs are being replaced with self-checkout machines in large retailers such as grocery stores, Home Depots, and other big box retailers. In addition, ATMs are replacing some of the need for bank tellers. These effects increase the level of competition for the remaining jobs, lowering their pay in equilibrium.
2. The productivity rate of the remaining workers skyrockets, as firms hire the most productive members of each profession, let go of the least productive, and pay those most productive workers less than they were paying any of their workers before due to the level of competition.
Now in a closed economy, automation would increase the need for manufacturing, as somebody would need to design and build things like automated check-out machines and ATMs. However, we are not a closed economy, and many of those jobs in manufacturing, as already mentioned, are in other countries. So automation has managed to increase productivity, lower wages, and accelerate off-shoring, by shifting jobs away from services and to the much more globalized manufacturing realm.
The one bright spot is an increase in repair jobs, although those jobs do not come close to replacing the jobs lost.
Automation and globalization are not necessarily bad things, as they lead to lower costs and higher productivity. However, it is important to consider their effects on the labor market, still the primary source of household income in all but the richest households, and try to better design an economy to handle these dual forces.