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Whether it’s cheap offshore labor or robots, U.S. jobs outlook isn't bright

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What’s really sobering about all this — aside from the trauma to the lives of all those who’ve lost jobs and can’t find work, or will lose jobs in the next decade and a half, whether to offshoring or robots — is that this may well foretell a future for this country in which there is a very large segment of the population that’s chronically unemployed or underemployed.

Talk about great timing: How much worse could it have been that, at the same time President Obama was unveiling his jobs creation package, Bank of America was tossing 30,000 of its employees on the unemployment scrap heap?

This, coming on the heels of the Post Office wanting to lop 30,000 people from its roster, the pharmaceutical giant Merck announcing plans to dump 13,000 employees, and not that long after General Motors eliminated nearly 50,000 jobs.

In the economic crisis created by the banking/housing crashes, the president has been confronted with a Sisyphean dilemma — pushing the boulder of jobs creation uphill, only to have it roll back down again from massive corporate layoffs.

The small business sector, often touted as the birthing place for new jobs, simply can’t compensate for layoffs on such a huge scale, particularly in an economy that’s getting clobbered at every turn.

There is no little irony, at a time when major corporations are jettisoning employees right and left, that many are also reporting record profits. They’ve found, in an environment where jobs are scarce, they can push employees to produce more, work longer, take fewer vacation days, settle for little or no salary increase and fewer benefits — hey, you don’t like it, there are thousands in China or Pakistan or India who’re happy to do it for a fraction as much.

While much of the focus has been on the hundreds of thousands of manufacturing jobs that have gone offshore — from autos to shoes to clothing to furniture, you name it — not that much notice has been taken of a trend that could be as much or more a threat long term: robotics.

From the self-serve scanners in supermarkets, ostensibly for “greater convenience to our customers” (incidental that they can get by with fewer human checkers), to automobile plants, to production of computer components, pharmaceuticals, and on and on, machines are now doing jobs that once required human brains and hands ... and salaries. Robots don’t tire of repetitive tasks, don’t need holidays, don’t call in sick on Monday morning — and American business is taking to them with great rapidity.

Auto production, for decades the foundation stone of U.S. manufacturing, now relies heavily on automation.

It is estimated by World Robotics Report that by 2025 robots will have taken over a whopping 50 percent of all jobs in the U.S. Predicted job losses to robots are 13 million automotive, 22 million manufacturing, and 9 million food services.

With a real unemployment rate continuing to hover around 16 percent, when counting those who have been out of work so long they have given up on finding work, the outlook for significant improvement in the jobs picture is not bright. The longer someone is out of work, the less employable they become, because companies see them as not being current in skills and training, and it’s easier to hire younger, cheaper workers. Many companies now won't even consider a resume from someone who's unemployed.

What’s really sobering about all this — aside from the trauma to the lives of all those who’ve lost jobs and can’t find work, or will lose jobs in the next decade and a half, whether to offshoring or robots — is that this may well foretell a future for this country in which there is a very large segment of the population that’s chronically unemployed or underemployed.

And that poses a real problem for not only government, but society at large — not the least the education sector. What’s the need, after all, of a college degree when the number of jobs that require human participation is ever-diminishing?

Nobody wants the U.S. to become a welfare state, but … what’s the solution for a business environment constantly seeking every way possible to produce to the maximum with the fewest number of employees?

That’s the dilemma that confronts not only the president and the Congress, but the country at large.

Discuss this Blog Entry 2

organicfarmer (not verified)
on Sep 26, 2011

The short term answer is place a 100/day tax on every operating robot so we can give unnemployment checks to those who the robot replaces. Of course we will still have the problem facing this small famer. Those overseas 'human' robots that harvest crops and force us to accept prices here below the cost of production.

Tom Quade (not verified)
on Sep 26, 2011

Always enjoy your commentary Hembree. These job loss numbers are representative of massive changes in our economy and impact millions of Americans. Technology has always threatened manual labor jobs and will continue to do so. Productivity increases, but jobs change. Other jobs are created, but don't get the press.

Visiting home in Iowa last weekend, my brothers were harvesting soybeans. They have a relatively small combine as they go these days, but still quickly harvested 16 acres within a bit over an hour putting nearly 1000 bu of soybeans into the one truck necessary to haul that to the elevator. My father would have required a full day to do the same only one generation ago and several trips with small wagons to haul it. Technology has replaced many farmers, but technology has improved productivity and generated many more jobs in ag supply industry. See the job listings at Agcareers.com. If you go there and select 'all jobs' you will see over 104 pages of jobs in various ag supply businesses. These are good jobs. There is a good follow up story here you might dig into.
gotta go that would be a good positive article about agriculture and how it helps support our changing economy.
thanks for good work at DFP.

Tom Quade
Edgerton, MO

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