“Donald Trump vows to create 25 million jobs over the next decade.” (NY Times 9/16/16).
“… under Hillary’s plans the economy would create 10.4 million jobs in her first term alone …” (Mark Zandi, former economic advisor to John McCain).
Of course, we all know that politicians are generally out of touch with reality and they regularly say things that have little substance in the real world… promotional “sound bites” if you will.
We know too, that the greatest reason for moving U.S. jobs to foreign shores is economic—goods can be produced more cheaply in foreign countries.
But, outsourcing jobs for economic reasons is the subject of a debate we don’t want to enter into here, because it is a debate that will never end.
At the same time, the issue of “jobs” in the U.S. is high on everyone’s mind and both candidates are making job creation one of the most important issues of their campaigns.
Unfortunately, the candidate’s promises for new jobs by bringing us back to the 1970’s and 1980’s are way off base.
We will never return to that era of job availability for the average person, and here are just a hint of a few reasons why:
Too Few Workers
Yes, I know that in addition to the reported unemployed there are over 94 million people in the U.S. over 16 years of age who are currently not in the workforce!
Just be aware that this number includes: high school and college students, all people over retirement age (including 17.5 million people over 75 years old), every person with a disability that makes it impossible for them to work, every person who will be starting their own business (about 6 million per year), and every parent who is choosing to stay at home to raise their children.
So, where does that leave us for a workforce pool of people to fill all those proposed new jobs? There are relatively few people not in the workforce today who can work, or that choose to work as an employee.
In addition, adding a few million people to the workforce will make little difference—unless they are specially trained.
As of May 2016 there were only about 7.4 million unemployed people in the U.S.—most of who are not qualified educationally to fill many of the jobs now available, nor the jobs that may be created in the future.
Of course, one answer to the shortage of workers necessary to fill all those jobs promised by our Presidential candidates is immigration.
In fact, this has been America’s answer all along. For example: 41% of Fortune 500 companies were founded by an immigrant, or the child of an immigrant.
Moreover, if all the immigrant engineers, scientists, and managers suddenly left the U.S., our economy would come to a halt and then dramatically decline.
Also, back when President Bush was talking about immigration reform, a Las Vegas newspaper cautioned him to be careful, because deep reforms (like deportation) would make Las Vegas “go dark.” Immigrants are the glue holding our economy together.
Here’s something to consider: If the candidates do happen to create some jobs, will we have to increase immigration to fill them?
(What about that Mr. Trump?)
A Broken Education System
I discussed America’s broken education system in a prior post, where, compared to many other Western nations, the U.S. is far behind in education, especially in the technical and scientific areas.
The world has gone through incredible changes in a short period of time and the pace of change is only increasing. Is the U.S. leading this change by being the world leader in education? Not by a long shot!
It takes a concerted effort by the entire country to make education a top priority in order to keep up—or better yet, to lead the world.
This won’t happen under the current U.S. educational system.
For example: The school dropout rate in the U.S. is somewhere between 12% and 25% depending on which statistician you believe, while in Finland the dropout rate is around 2%.
It should also be noted that Finnish students are leaders in the world for math and science, and they are closely followed by South Korea.
Globally, American students rank around 17th for math and 24th for science. If you didn’t look at the prior post mentioned above, I suggest you at least take a look at the short video below.
Without a strong countrywide commitment to education, can the U.S. even compete for jobs with the rest of the world—let alone be the leader?
Perhaps this should be called “The Lazy American.” There seems to be a couple of broad divisions in the U.S. workforce today.
The first group are those who have unbridled ambition and a strong desire to become successful and make a contribution at their chosen endeavor no matter how hard they have to work. These people usually become craftsmen, technicians, professionals, or entrepreneurs.
The other side of this work ethic represents those people who are sidled with what I call the American Malaise, and they choose to go through life working as little as possible. “Hard work” is anathema to them.
I have been employing people, and advising other businesses about employing people, for over 50 years and I have observed the sad decline of the American work ethic over that period of time.
The single biggest complaint I hear from businesses today is that they cannot find enough people who are willing to “work”—at any wage level.
This of course does not hold true for the entrepreneur… no one works harder and longer than the founder(s) of any kind of business. Except—it should be noted that there has been a long-term decline in entrepreneurship by the 20-34 age group.
The most rapid increase in the rate of new startups is by entrepreneurs in the 55-64 age group. The two youngest categories of entrepreneurs continue to decline in their rate of startups.
Finally, if you could look online and see all the jobs available, or see the thousands of want ads in various print forms and business windows across the U.S., you would likely see more jobs available today than there are unemployed workers. The problem seems to be that those jobs might require some form of “hard work.”
I’m not sure that creating more jobs would do much to motivate the bulk of unemployed Americans to go to work—or to bring many more native-born into the U.S. workforce.
Robotics seems to be one of the answers to the American Malaise and the high cost of labor in the U.S,
In 1979 GM employed 618,365 workers in the U.S. alone (853,000 worldwide). As of February 1, 2016, GM employed 50,300 workers in the U.S (215,000 worldwide).
The mayor of Lansing, Michigan recently noted that GM can now build the same number of cars with 5,000 workers as it did with 25,000 in the 1950’s and 1960’s.
This is not only true at GM, it is the same for all auto makers, as well as across all other manufacturers, regardless of the product being produced.
Take a look at the video below and see how many production workers it takes to build and paint an auto body at Chrysler’s Sterling Heights factory:
Not only is manufacturing eliminating human workers, but robots are being developed and installed in virtually all occupations. Here’s a look at one of Amazon’s distribution centers:
Artificial intelligence (AI), deep learning software, and emotion recognition software are making huge inroads in education, health care, laboratories, offices, restaurants, and everywhere humans are currently working.
There is a whole new type of “soft robotics” being developed, where polymers struck by a laser will move and perform simple tasks. Nothing is beyond the scope of the imagination when looking into the future of jobs and robotics.
Eventually machines will have the ability to innovate and posses other traits we consider as uniquely human today.
As a result, I predict that in the not too distant future, there will be no “burger flippers” in fast food restaurants; no checkout clerks in big box stores; far fewer office and lab workers; health care workers being supplemented, or replaced, by AI and robotics; driverless taxi cabs; robotic road repair machines; and on and on.
The good news is that it is going to take scientists, engineers, and technicians to create, develop, build, program, and maintain all these machines.
There could also be an entirely new field of work in teaching people how to interact with AI and robotics, so the machines will partner with humans, not just replace them.
The bad news is that we are not preparing our young people to embrace this technological future and fill these new jobs as they are created (see “education” above).
This is likely the reason that, of the top 9 manufacturers of robots in the world, 5 of them are in Japan, 2 are in Switzerland, 1 is in Italy, and 1 is in Germany.
Installation of robots grew 27% in 2014 over 2013… sadly, it appears that most of the engineering and manufacturing jobs associated with this rapidly growing industry will remain in foreign countries—at least for the foreseeable future.
We have a lot of catching up to do, and although venture capitalists are pouring money into new U.S. AI and robotics startups (see CB Insights reports), the question remains; where will they get the qualified people to work at these new companies?
* * * * *
Well, there you have just a few of the many reasons the U.S. will never repeat the past regarding jobs and employment—especially employment for persons without an education.
So, Ms. Clinton, and Mr. Trump, isn’t it about time you stopped trying to drag us back into the 1970’s and 1980’s with your promises, and give us some realistic plans for building a new economic foundation for prosperity in the 21st century—if you have any plans?
Here’s an idea: How about telling us how you would support the anticipated explosive growth in entrepreneurship over the next few years.
With our rapidly growing population we will need more and more smaller small business startups to provide the goods and services we need in our everyday lives. Not every entrepreneur will be starting a high-tech or social media company.
Yet, without some form of outside help, especially government support, most of these new businesses will fail.
How about it—can our presidential candidates get “real” at least for a little while?
Anyone with additional thoughts on this issue, please leave your comments below.