Thursday, December 22, 2016

Automation

The Trump team continues to preach the gospel of bringing back large numbers of manufacturing jobs to the United States.  This was an important talking point during his campaign and the rhetoric has not been tempered any since he won the election.  The Trump/Pence dog and pony show of "saving" the Carrier jobs was exactly that.  Even the union boss, Chuck Jones said that the politicians mislead the public about how many jobs were going to be kept in the U.S.  The small print with the Carrier deal looks to include provisions that the company will be investing millions in their U.S. facility.  Apparently a large share of that money will be for automation.  That means fewer jobs. See the link below for further information.

From what I have been reading, the effects of automation have been more of a factor in the loss of manufacturing jobs than bad trade agreements.  The Chinese are unfazed by the threat of U.S. tariffs.  My Wall Street Journal today had an article about the Chinese electronics hub of Shenzhen.  The article "Chinese Electronics Hub Embraces Change" by John Lyons discusses how this area has become so efficient at manufacturing and shipping goods that they feel no pressure from other competition.  Per the article: 

"If these jobs come back to the U.S., they are going to be for people who manage 1,000 robots in an automated factory", said Christopher Balding, a finance professor at Peking University in Shenzhen.  "It will be jobs for computer nerds, not the people who voted for Trump." 

We need to be discussing this issue more in terms of educating or re-educating our work force.  Globalization is here to stay no matter what the politicians tell us.  This is obvious even to those of us not in the manufacturing realm.  The Secretary of Labor nominee Andrew Pudzer has apparently commented on automation.    

The article "What's Really Killing Jobs?  It's Automation, Not China" By Claire Cain Miller in today's New York times stated the following: 
     
"Andrew F. Puzder, Mr. Trump's pick for labor secretary and chief executive of CKE Restaurants, extolled the virtues of robot employees over the human kind in an interview with Business Insider in March. "They're always polite, they always upsell, they never take a vacation, they never show up late, there's never a slip-and-fall, or an age, sex or race discrimination case," he said."

The article also discussed the lack of skills that workers have in shifting to more automation.  It stated: "Even in the best case, automation leaves the first generation of workers it displaces in a lurch because they usually don't have the skills to do new and more complex tasks, Mr. Acemoglu found in a paper published in May."

It further noted: "Over time, automation has generally had a happy ending:  As it has displaced jobs, it has created new ones.  But some experts are beginning to worry that this time could be different.  Even as the economy has improved, jobs and wages for a large segment of workers -- particularly men without college degrees doing manual labor -- have not recovered."  

Is this topic being addressed by Mr. Puzder or Betsy Devos, Secretary of Education nominee?  It is vital that we have plans on how to help our workforce stay competitive in the global market.  I am not seeing much news regarding the necessary education changes that our citizens need in order to compete in this technology driven manufacturing environment. The article mentioned some of the changes needed: 

"Labor economists say there are ways to ease the transition for workers whose jobs have been displaced by robots.  They include retraining programs, stronger unions, more public-sector jobs, a higher minimum wage, a bigger earned-income tax credit and, for the next generation of workers, more college degrees.  The White House on Tuesday released a report on automation and the economy that called for better education from early childhood through adult job transitions and for updating the social safety net with tools like wage insurance.  Few are policies that Mr. Trump has said he will pursue."

However, there is another element to this discussion.  The individual worker.  If we as citizens have indicated with our votes that we desire a smaller government, with less regulation (the GOP dream) then we as citizens also have a responsibility to adapt to the changing job market.  We must be willing to learn new skills or move where the jobs are located.  To just be complacent and do nothing but sit in a no-win situation and complain about the loss of jobs and our past way of life is shear laziness on our part.  We must be active participants and willing to adapt to our rapidly changing world.  Change is sometimes painful but to do nothing but expect the government to wave their magic wand is wrong. 
  
http://www.wsj.com/articles/u-s-factories-are-working-again-factory-workers-not-so-much-1482080400

     

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