Tuesday, November 20, 2012

The Job Gap

Where will the jobs come from? That was the big question discussed with some friends last night. Unfortunately we didn't come up with any easy answers!

Starts-ups and entrepreneurs got a mention - especially in the IT/software sector. I was more sanguine - it'll take a lot of start-ups to make a big dent in our current unemployment levels. What's more, new research in the UK shows that entrepreneurs are more risk averse - not less - than the total population. Go figure.

John Mauldin makes the case for manufacturing in his latest newsletter - it's the only sector capable of absorbing the unskilled and the semi-skilled in large numbers. But I don't think it's about betting on the right sectors. An increase in consumer spending - and the resultant boost to demand for shops, restaurants and hotels - will do more to create jobs than delusional aspirations to become the next Silicon Valley. But that's a matter of economy policy, not employment policy.

The default solution in these conversations is: education. We need a better educated workforce. Which usually translates into more degrees. I'm not so sure. It's not working so well in the United States right now - take it away Peter:

1 comment:

  1. Maybe we're focused on the wrong aspect of the problem.

    So let's try and look at it in a different way, for interest.

    On the one hand, you have the problem of "how do best we increase the overall wealth of the country" (in as many terms of wealth as we can encompass including GDP etc.).

    On the other hand, we have the problem of "how do we distribute this wealth in the fairest manner".

    Now, the default answer to both the above problems is, create more jobs - these jobs both provide the means to create increased wealth, and distribute it fairly.

    But we have to ask ourselves at this point in time, are the default answers working so well for us anymore?

    Take a hypothetical scenario - imagine that the current generation of ~50-80 year olds had devoted all their work-life energies to creating a long lasting automated and robotised productive infrastructure that was capable of producing all we need and more, but with little need for human operators.

    One of the consequences of this automatic infrastructure would be very few jobs, since all would be handled by automata.

    Then, the question would become, how the hell do we distribute the wealth and goods created by this fantastic industrial infrastructure?

    Let's also focus minds more carefully on the 'problem' of unemploynment.

    What is the problem in unemployment? Is it in not having a job?

    Or is it in being unable to access the same level of resources as the rest of one's community? And the sense of loss of social standing and personal worth? And of having no outlet for one's productive energies?

    I'm sure the above will raise hackles. But I am convinced this crisis and consequent ones in the near future, will force us to think well out of the box.


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