According to this theory, in recessions before the 1990s, recessions used to be simply a matter of contracting aggregate demand, and companies reacted accordingly--laying workers off during the downturn, then hiring them back as demand picked up. But during the 1980s and 1990s, recessions took on a much more industry-specific character. Changes in technology and trade meant that entire industries or job descriptions contracted, often permanently. The workers they laid off, with their specialized skills, took much longer to be reabsorbed by the labor market.I think one of the problems that is a part of this discussion is that while business has become more global, labor hasn't kept pace with it. Globalization has been happening for a while, but labor hasn't "globalized" yet. Sure, jobs are being moved around the world to where they can be done more cheaply, but individuals have yet to move around the world with similar speed, i.e. an individual's mobility is limited.
For example, if you live in Detroit and your skills make you most suited for factory work, it is unlikely that you are going to uproot your family and move from Detroit to China to chase your freshly outsourced factory job. Forget government interference and restrictions, there are cultural, social, and language barriers that exist which prevent such movements from occurring (assuming that an individual even wants to move).
One observer pined for the good ol' days when an American worker could make a decent wage without a college diploma:
I've long felt that this country badly needs a reinvigorated marketplace for jobs that pay a good wage but don't require a college education, a perfectly common thing as recently as 40 or 30 years ago.I couldn't disagree more. In one of his chapters from The World is Flat, Thomas Friedman correctly (in my opinion) points out how the outcome of next generation's American worker hinges on education. The answer isn't simply "more education," but the "right education." Focusing on the right education will train our children to work in the types of jobs that the world economy demands and that will exist in America in the future. The right education will allow future American workers to continue to prosper and have the same opportunities for the high standard of living that we currently enjoy (although, one can only hope, exercising a bit more restraint when it comes to consumption).
Obviously, the idea of "no education" is a step backwards from the notion that we need the right kind of education. Sure, the commentator correctly points out that higher education is mostly a signaling device for employers, and that if everyone went to school, there would be no way to differentiate oneself. But the problem that they are really lamenting is that this type of middle-skill job (a good paying job with little to no educational requirement) is becoming increasingly scarce in America; these jobs are being relocated to places like India, China, Russia, and Eastern Europe.
Unfortunately, the workers that used to have these jobs can't relocate with them. What that means is that workers will either have to move horizontally (find a similarly skilled job) or move up one rung on the ladder (increase their employment skills). The first option simply sets them up for another layoff, while the second option requires that they upgrade their skills, most likely through some form of education or training, which completely neutralizes the argument for no education. Therefore, we can conclude that in order to make a decent wage, they must attain at least some form of education, otherwise they risk being left behind and stuck earning a low-paying wage in the global economy.
So, my question is this: will the next big step in globalization be the globalization of labor? If not, will we ever see the globalization of labor where a worker moves from Australia to Norway as easily as if they were moving from Seattle to San Francisco?
No comments:
Post a Comment