More People and Fewer Jobs
by Masse Bloomfield
In a Los Angeles Times article in 2003, the reporter, David Friedman, wrote about “White Collar Blues: Government and the Rich Win and Educated Workers Go Offshore.” He does not mention “productivity” in his article nor does he mention the increase in population. He seems only to emphasize the loss of jobs.
Friedman is concerned that the rich are getting richer and the rest of us take what gleanings are left. He writes, “Before the mid 1980s, Americans of all classes shared more or less equally in the economic gains … Since then, gains in income and wealth have become increasingly concentrated in the hands of fewer and fewer Americans … And incomes of the top five percent of U.S. households grew nearly three times faster than those of the remaining ninety-five percent.”
There is no mention of the fact that 300 years ago 90 percent of Americans worked on the farm, now there are fewer than three percent of our workers in agriculture. We have been able to absorb the farmers in our industrial sector. But if the industrial sector contracts, where can we place unemployed workers? If industrial production is shipped off-shore, we won’t send the displaced workers with the factories.
Friedman also feels that “official America seemed indifferent to the exodus of manufacturing jobs overseas – a net loss of five million jobs since 1979 – and now seems unworried about the potential flight of white collar workers, which one report predicts could amount to half a million of the 10.3 million U.S. technology jobs.”
Friedman mentions immigration in a couple of places. He writes, “Exposed to trade and immigration pressures, earnings are falling or stagnant in a growing number of occupations.” And “Imports … could be limited … or legal immigration levels more strictly enforced.”
There are two aspects of our society that Friedman fails to mention that will have an impact on jobs and our society. The first of these is the dynamics of population growth. No matter what, the U.S. population is growing and therefore everything about the country has to grow with that growth. No one I know of except some environmentalists, have called for no growth in either our population or economy. Politicians and company leaders to a man feed on growth. If corporate earnings don’t grow each quarter, stock prices drop to reflect that lack of growth. So most of us believe that stopping immigration will stop growth. And growth is one of the forcing elements of our economy.
Then the second factor that Friedman truly neglected is productivity. There is no way to stop the increase in productivity. Corporate leaders know that their growth is tied to the increase in productivity. For if those leaders fail to increase their productive capabilities, some other company will, even it if is a Japanese company. To compete in this market, management maintains as much emphasis as it can on productive gains.
Increasing productivity has a wide base of support. Not only do our companies support a huge industrial research capabilities, so do the universities. The universities produce many of the ideas that lead to increases in productivity whether in computer software, computer hardware, industrial machines or in office equipment. Even with a huge imbalance in the distribution of wealth, there is no loss of ingenuity or creativity or inventiveness. England lost its industrial lead due to what Friedman says is “That societies with skewed distributions of wealth tend to be less dynamic.” And because of that imbalance of wealth, Friedman believes that England lost its lead in the production of goods. To me, the English entrepreneurs seemed to be more interested in the trappings of wealth, than in such undignified work as increasing productivity. I cannot see that happening in the United States. There are too many inventors and venture capitalists willing to back ideas of increasing productivity or creating new products, to let the economic and productivity lead decrease.
Thus in a dynamic United States where productivity is in essence telling us we need fewer workers, we are allowing a million new immigrants a year to enter the country either legally or illegally. No one seems to notice that we continue to need fewer workers due to the productivity gains. At the same time, we are sending work to China, a low cost producer, using American productivity techniques. What do we do with the millions of immigrants?
As human beings, we haven’t faced the prospect of not needing any increase in people. We are all addicted to growth. Sooner or later, we will have to face the imbalance of rising productivity and increasing population pressures. Once everyone on earth has two automobiles, we will have to cut auto production as well as auto workers. These seems to be no way to appeal the two forcing elements of increasing productivity and increasing population in the world.
We will have fewer jobs and more people. Can we expect the result to be in more poverty and human suffering and joblessness?