Tuesday, January 18, 2011

Laura Tyson Gets Lost in the Faculty Lounge

Economic genius Laura Tyson has written an article telling us all why the jobs haven't come back. "There's not enough demand!" she cries. Actually, Laura, more demand isn't the issue. We get paid too much. That's the deal. We don't have the jobs because companies can hire Chinese, Indians or Mexicans for far less. More regulations, more government spending and more debt isn't going to solve this problem. We just get paid too much. You have to compete for jobs and right now we're losing that competition.

Update: This was unnecessarily nasty and I wanted to delete it, but some of you took the trouble to comment, so I'm leaving it alone.


Foxfier said...

What pisses me off is that a lot of it isn't even pay-- it's all the BS that goes into needing to hire someone, ignoring the paperwork side! Add in that we're dying under mounds of lawsuits, and that lawfare activism is a no-risk situation, plus customer X's stupidity is a lawsuit liability on your part.....


K T Cat said...

Regulations! We need more regulations!

Foxfier said...

Make sure they're cost-effective, science-based and transparent!

tim eisele said...

A question I don't know the answer to, or where to look for the answer:

Is the US primarily losing jobs to workers overseas, or to domestic robots?

Or to overseas robots?

Personally, if I was starting a company, I'd automate the heck out of it to minimize the number of people I had to hire. Mainly to avoid the problem that Foxfier brought up, but also because human employees are a lot of trouble. I think that fairly soon, even traditionally labor-intensive businesses like restaurants are going to automate - even in China.

tim eisele said...

KT, thanks for recognizing when you are being unfair, and especially thanks for being willing to admit it when you notice yourself doing it.

And, to answer my own question in the previous comment, see this article: "Technology Explains Drop in Manufacturing Jobs".

He points out that, while the number of US manufacturing jobs has been decreasing over the last decade, the actual US manufacturing *output* has been nearly constant over the same time period. He also gives a graph that shows that, while our imports from China have been increasing, this has mostly been at the expense of our imports from other Pacific Rim countries.

Basically, we aren't losing our manufacturing jobs to the Chinese, we are losing them to the robots. Interestingly, his last graph shows that the Chinese are *also* mainly giving new jobs to their robots, and not actually hiring more manufacturing workers.