Monday, January 24, 2011

The Vanishing Hope of Jobs

I had lunch with a new acquaintance made recently through the blogging spheres. Like a few of my other friends, he is a former employee of Hewlett Packard in our city. At one time HP employed close to 10,000 people on it’s industrial campus in town; today there are roughly less than 2,000 people remaining.

The photo above is the empty Nypro manufacturing facility, a company that provided services to HP. Nypro shifted the remainder of it’s manufacturing overseas laying off all it’s workers and closed the plant. The empty Nypro building is located along an increasingly desolate row of empty buildings on “Technology Loop” not far from my home where I ride my bike.

The HP campus on the other side of the city is turning into a ghost town as well; many of the buildings are empty and shuttered, a few are leased by other companies as warehouse space.

I heard on the news recently that even companies considered particularly American, such as Cisco, IBM and Sun essentially have little to no domestic manufacturing facilities. Though the “design” may be done here, the manufacture of the actual products is contracted out to companies outside our borders.
Leo Hindery, a former CEO who heads the US Economy/Smart Globalization Initiative at the New America Foundation, is one of the foremost advocates of a U.S. industrial policy.

"I think you have to start with the premise that a country as big as ours -- the largest of the developed economies -- can't survive with less than 8 percent of its men and women making something,"

According to the latest figures, about 7.6 percent of the workforce is currently engaged in manufacturing.

"It needs to be 20 to 25 percent," Hindery said, "and it needs to be 20 to 25 percent of GDP, otherwise the gap that you have to fill is achieved only through consumer credit." 1
The country is scratching its collective head puzzling over our “jobless economy”. We have an expectation that things will turn around and be the way they once were; that unemployment will somehow return to 1980’s level. And we demand quick fixes - the Republican machine rode a populist wave into the House of Representatives on the implied promise that Jobs would mystically arise from thin air merely by putting the Conservatives back into power.

But I don’t think the Republicans give a damn whether or now the Great Unwashed have jobs. They care only to be in control of the factors which will direct corporate profits; and profits are no longer dependent on the domestic market any more, their sights are overseas. Indeed, the top few percent whose wealth is based on equities have seen unprecedented growth recently. But where are the jobs for the middle class? The answer is that the wealthy no longer need us as either employees or consumers.

I believe we are waiting for a recovery that is never going to come. Some of the vacant buildings on Technology Loop have now been rented by local governments needing office space. But now Americans graduating from university have almost a better chance of finding jobs outside the country than here at home. “Shanghai and Beijing are becoming new lands of opportunity for recent American college graduates who face unemployment nearing double digits at home.” 2

I have been accused of being depressed about the future of our country; that I lack the optimism that many others do. But optimism must to be based on something more tangible than faith and hope; and in romantic notions that our past reputation as a world leader in innovation will carry us into the future. That was then, this is Now.

Suggested further reading:
"The Real Economic Lesson China Could Teach Us", Robert Reich, January 19, 2011.

References:
1. “Hu's Visit Is Reminder Of One Way China Leaves The U.S. In The Dust”, Dan Froomkin, Huffington Post, January 20, 2011
2. "American Graduates Finding Jobs in China", NY Times, August 10, 2009

19 comments:

Rain said...

I think you nailed it. Unless government acts to make it unprofitable to send jobs overseas, this can only get worse. When we see Obama appointing to a key labor position someone from a large corporation, not from small start up businesses, we can see he isn't on our side either.

I read an article recently where they said when a company discovers they can lay off a bunch of employees and still have as much production, they will not re-employ when times are better. Why would they get the same production? Because they demand the same work, with longer hours and more pressure, making the remaining employees work like dogs to hold onto what they have.

We are in a society that values the stock market more than jobs and that's a very sad thing to have to admit when it's a bunch of Democrats doing it :( Who is left on the side of the working stiff?

DJan said...

All I can say is that my decision to retire in March 2008 just put me in under the wire. I retired and all hell broke loose. After I left, three months later the job I had for thirty years evaporated when the entire section I was in was eliminated.

Although I have lost 25% of my annuiities, I can still make it on what's left and Social Security. We lost any frills and dreams of travel, but we don't have to look for work in the scary work environment of today.

billy pilgrim said...

i love the statistic on the percentage of people working in manufacturing. does the 7.6% figure refer to the total population or the workforce? if it refers to the workforce then the figure for the total population would probably be south of 4%. scary!

i don't see much sunshine on the horizon for those without skills. in fact those with skills have no guarantee of a job these days.

Robert the Skeptic said...

Rain I have always been puzzled by the pursuit of "productivity" which I have taken to mean more work being done by less workers. If that is the goal, why would you need or value workers? They are merely a drag on profits.

I agree that the Democrats seem to be supportive of the working stiffs when their goals are parallel to their interests. When they diverge, the working stiffs find themselves abandoned on the side of the road.

DJan We retired AFTER our state retirement was gutted, we left because we would not gain anything more by staying on. We have cut back our retirement plans greatly but pick and choose our leisure and pleasure activities. Like you, Social Security will be what sustains us above our own meager savings. And SS is in the sites of those who have the most wealth already in this country. When is enough enough?

Robert the Skeptic said...

Billy The article, which I believe I linked to, has a link to the actual government statistics. Unfortunately I can't answer your question but would refer you to follow the links.

Indeed, without a college education, there is almost no hope of any job. This in a country where more than half of our minority population drops out of High School. But college is becoming less and less affordable to the middle classes. More people competing for less jobs. It is a recipe for disaster.

KleinsteMotte said...

Global economy means we educate them in our country and then they search the world for jobs . Canadians have been exporting doctors and teachers along with raw materials. Not much in made here either. The stamp, 'Made in China', appears on most items available to purchase. I doubt there's much that's labelled,'Made in Canada". It would be too costly for the majority.
Retirees pensions are not secure anymore either. Many plans rely on employees to adding to the funds and without that the funds will dry up. The future looks grim for our youth. Many are doing extra degrees hoping for better outcomes but???

GutsyWriter said...

I do feel a "your" lack of hope, but on the other hand, I believe that every generation sees changes they don't like. As far as the U.S, the movie, "Waiting for Superman," stated that the U.S. won't have enough educated people to take the necessary jobs by 2020, and that we'll have to import "brains." So we're exporting jobs and importing "brains"; what does that say?

Robert the Skeptic said...

KleinsteMotte The US is looking to Canada for oil and natural gas, that may be your saving grace. But likewise, there seem to be too many people and not enough economic resources to provide for them all. It is frightening for our children.

Gutsy We are already importing "brains". The few companies in our Technology Loop area have employees from Inda and Pakistan here on Work/Visitor visas. They do high skilled engineering work but for a fraction of what the company can pay US Citizens. I agree with the documentary that the US won't have enough educated people but what jobs will there even be for them to take? I'll Netfilx that documentary.

Jon said...

I believe that our education system is falling farther behind the rest of the world. Without that basic training we don't have a chance to be effective competitors in the world economy. Besides, we're too busy scaring the bejeezus out of each other with our violent tendencies.

Robert the Skeptic said...

Jon Indeed, in today's NY Times was an article about how testing reveals that only 2 high school students out 100 show any mastery in science studies. Only one-fifth of high school seniors scored above the level considered proficient.

So if the US is supposed to be this beacon of innovation, are we going to depend on the few Bill Gates' we graduate to lift the rest of the illiterate out of poverty?

alwaysinthebackrow said...

The cost of labor is a mere line on the balance sheet an "expense" to be offset against "income". No longer is there a sense of having people's lives in the hands of the employer. I remember the sense of responsibility I felt when I had employees who were dependent on my work to support their families. It was awe inspiring. It will never be like that again.
I agree that we will never go back to the times of the past, where my father and my husband stayed in jobs for 30 years, feeling that they were a valued member of the employer's business family. My husband is putting in time to just get to the point of qualifying for medicare, He receives no respect nor appreciation for his efforts, and has no respect for the employer, either. We have turned into China. The individual has been sacrificed for the good of the masses.

Nance said...

This is a conversation so worth having and you are the very man I like to have it with.

I entirely agree that we are "waiting for a recovery that is never going to come."

It isn't romantic fantasies of a return to anything resembling either the fifties or the affluent nineties, nor is it my hope that we'll be able to capitalize on our prior reputations that births my optimism. I am known to be a pessimist by temperament.

It's something bigger, older, deeper. It was birthed by the stories my parents and grandparents, great aunts and uncles told. And it has been nurtured by a love of history, philosophy, psychology, and evolution.

I don't want to blog on your blog, my friend, so it looks like I'll need to blog this subject further on my own page. But I wanted to respond briefly here.

You tell the truth: that America of the fifties through 2007 is gone and it won't come back. Our grandchildren will live in an America I can't imagine. Or, if they live elsewhere, someone will live here, because this is a beautiful country.

My faith is in the adaptability of the species. All over the world, throughout history, when a people are halted in their march toward one direction, they go in another. We have some very, very exciting discoveries, technologies, creations and fabrications ahead of us. Our grandchildren will find their way just as we have found ours. They will be excited. They will be productive. They will be frustrated, happy, sad, nourished, depleted, and enriched by lives you and I cannot imagine.

What the stories of the old people in my family taught me is that people will find a way to be happy even when they have nothing much but each other. They will also be saddened by much, overworked often, disappointed to an entirely human degree. They will get human lives, just as we did.

You and I are okay, even though our lives seem diminished from what we expected. We may not have iPhones or iPads. We may not need dress clothes anymore except for funerals. We may not get to Europe again or even for the first time. Maybe we read more, or grow vegetables, or take inexpensive classes at local colleges, or...find each other here, engaged in meaningful conversation with good people. We adapt. And after a while, we find ways to make life worth living.

And, first, we need to grieve the loss of what we knew, for however long it takes us for that grief to finish with us.

I don't loll around in baseless hope. My balloon rises higher; I stretch my perspective even as my personal horizons shrink. I may be a pessimist by temperament and a stark realist by experience, but I am now an optimist by policy.

And I have been enjoying the hell out of your recent posts.

Robert the Skeptic said...

BackRow I similarly recall my early days when I worked for US Bank. Back then it was like an extended family. Then Reagan was elected into office and the whole atmosphere changed. The company experienced its first layoffs in its entire history. Employees became liabilities, an expense that one could cut to make more profits.

Even today there are no real "loan officers" in your local branch bank; your application is faxed to the the central office where the loan officers actually are located. Good luck even finding a Manager any more.

Nance Nance, you have as usual, maintained that small flickering flame of hope. Though I believe John Boehner and company would blow it out in a heartbeat, there are those among us who will do whatever it takes to keep it lit.

On a planet of 6.7 billion people, which is expected to double by 2025, I don't see much wiggle room. But in my despair, I would be the first to gladly admit that I was wrong. I hope it will be the case.

I thank you, heartfully, for your contribution.

Snowbrush said...

"They care only to be in control of the factors which will direct corporate profits..."

While waving the flag, "supporting the troops," and railing against gay rights and abortion, of course.

I just reamed you by the way on my blog for not letting me know that Dan Barker was in town. I would have taken the drastic step of actually leaving the Eugene city limits had I known. I've been thinking of joining the FFRF lately, but I obviously waited too late to find out about his visit.

secret agent woman said...

I'm begininng to lose hope, too. And I worry for the kids I'm sending out into the world.

Entre Nous said...

I probably shouldn't be attempting to voice my concerns since my brain has turned to mush. Too much snow, too much shoveling, too old for this, why am I not in Bonaire right now?

Anyway. The only thing I see anyone doind as far as job creations go, is being redundant. This building is old, tear it down, replace it with a new one, more jobs.

There is an article in the newspaper here today about kicking the town supermarket out of it's building (as opposed to a national chain style one). It's smack in the middle of a giant parking lot that used to be a strip mall. Well at the other end is a McDonalds the powers that be want to relocate just past the pother side of the supremarket next to the Dunkin Donuts. The powers that be say it will create jobs (and take away the supermarket I can walk to, since it's looking like I won't be getting my car out till spring...). Its also the only grocery store the folks who live in senior housing can get to. They don't drive. It is always temporary jobs, one maybe two years, then back to square one.

I think of how there once was a time and place for unions, and don't get me wrong, I was in a 'closed shop' at work, but they have sent the entire country into a tailspin, never mind giving manufacturers in this country an excuse to send work out country. It took a long time to get where we are now We've over-priced and under-valued our very lives, while leaving less and less open spaces, all in the name of jobs.

Too many people, too much stuff, and everyone wanting more.

I like DJan retired just under the wire (by three days) before the new 'contract' went into effect. Management had given up on trying to bust the union and just started refusing everything. Defense manufacturers in the area continue to wait to sign contracts so that they can lay off, then rehire at lower rates. What part of this stuff is government in general not getting?

Snowbrush said...

So, it's legal in your part of New England to use eminent domain to take away private property from one owner and give it to another? After the Supreme Court decision authorizing such theft, I had thought that most states made their own laws to prevent it.

Robert the Skeptic said...

Snowbrush Sorry, my friend, I just assumed that your organization down there was connected into the Atheist "web" out there. We have recently started using FaceBook for the Corvallis Secular Society. You are certainly free to join in the discussion. We try to post events like the FFRF/Socratic Club event recently.

Secret Agent I agree with you, we worry about our grand kids. Two of our children do not have kids yet and we hope they think long and hard about that decision.

Entre Nous I have always been dubious about "construction" being much of a job creator. Once the project is completed, the construction workers (I know some personally) are unemployed.

I was in a union for half of my career (SEIU Local 503) and see the advantages. But the younger set is increasingly absent from participation. When we have struck (twice) it's the younger set who cross the picket lines and work. They think they are garnering favor with their supervisors. But the supervisors are mostly former union so it doesn't cut much sway. The young people are going to find out NOW just what the working world is like without unions. It is already proving to be a hard lesson.

Snowbrush said...

No, I don't even know about the Atheist Web, but I'll look into it.