job seeker job opening job skills job creation

Don’t Blame the Work Force
automation labor costs poverty income

Jobs are Not the Answer

Jobs go unfilled not because people lack skills but because employers pay too little. If not the boss, who or what else could increase income? These three 2013 excerpts are from: (1) New York Times, Jun 15, on skill sets by the Editors; (2) Good Jobs 1st, Jun 19, on subsidies by Clawback; and (3) Politic 365, Jun 15, on income by A. Sheahen.

by NYT EditorS, by Clawback, and by Allan Sheahen

April had a ratio of 3.1 job seekers, or 11.7 million people, for every opening. No category has been spared: unemployed workers outnumber openings in all of the 17 major sectors. The biggest problem in the labor market is not a skills shortage; rather, businesses do not have sufficient demand to justify adding employees.

When there are many more applicants than jobs, employers tend to impose overexacting criteria and then wait for the perfect match. They also offer tightfisted pay packages. What employers describe as talent shortages are often failures to agree on salary. If a business really needed workers, it would pay up.

Corporate executives want schools and, by extension, the government to take on more of the costs of training workers that used to be covered by companies as part of on-the-job employee development. They also want more immigration, both low and high skilled, because immigrants may be willing to work for less than their American counterparts.

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JJS: Under the guise of creating jobs, politicians step in and give public money to rich and powerful insiders.

In recent years, state and local governments have been awarding giant economic development subsidy packages to corporations more frequently than ever before. The packages frequently reach nine and even ten figures, and the cost per job averages $456,000 and often exceeds $1 million.

In dollar terms, New York is spending the most, with megadeals totaling $11.4 billion. Next is Michigan with $7.1 billion, followed by five states in the $3 billion range: Oregon, New Mexico, Washington, Louisiana, and Texas.

“Despite their high costs, some of the deals involve little if any new-job creation,” said Good Jobs First executive director Greg LeRoy. “Some are instances of job blackmail, in which a company threatens to move and gets paid to stay put. Others involve interstate job piracy, in which a company gets subsidies to move existing jobs across a state border, sometimes within the same metropolitan area.”

The most expensive single listing is a 30-year discounted-electricity deal worth an estimated $5.6 billion given to aluminum producer Alcoa by the New York Power Authority. Taking all of a company’s megadeals into account, Alcoa is at the top with its single $5.6 billion deal, followed by Boeing (four deals worth a total of $4.4 billion), Intel (six deals worth $3.6 billion), General Motors (11 deals worth $2.7 billion), Ford Motor (9 deals worth $2.1 billion), Nike (1 deal worth $2 billion) and Nissan (four deals worth $1.8 billion).

Fifty-six megadeals went to corporations with parents based outside the United States and seven more went to joint ventures of domestic and foreign companies.

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JJS: Yet humans don’t need mindless work so much as they do need an ample amount of money.

The marketplace has changed and there will never again be enough jobs for everyone who wants one — no matter who is in the White House or in Congress.

Fifty years ago, economists predicted that automation and technology would displace thousands of workers a year. Now we even have robots doing human work.

Global capital will continue to move jobs to places on the planet that have the lowest labor costs. Technology will continue to improve, eliminating countless jobs.

“Work” and jobs are not the answer to ending poverty. To end poverty and to achieve true economic freedom, we need to break the link between work and income.

Job creation is a completely wrong approach because the world doesn’t need everyone to have a job in order to produce what is needed for us to live a decent, comfortable life.

When we say we need more jobs, what we really mean is we need is more money to live on.

One answer is to establish a basic income guarantee (BIG), enough at least to get by on — just above the poverty level — for everyone. Each of us could then try to find work to earn more.

To read more

JJS: As usual, the well-meaning author wants to tax the rich and give to the poor -- plus save public money by abolishing job programs. But is that just as much in-the-box thinking as the critiqued belief in jobs? Why create the rich in the first place?

Must the money for an extra income come only from individual income or property? Couldn’t the money come from our common wealth? Yes, we do have a common wealth. It’s all the money that all members of society spend for goods never created by anyone’s labor or capital, goods such as land, resources, airwaves, and ecosystem services. That spending is trillions. The fact that society does not recover it but instead leaves it on the table is what creates the rich in the first place.

So, by redirecting such spending from the few to everyone, we’d catch the money upstream rather than downstream and preclude the accumulation of undue fortunes in the first place. At last, we could get over the Protestant Work Ethic and embrace the Polynesian Play Ethic. Economists and economic reformers, if still hanging around, could find something useful to do.


Editor Jeffery J. Smith runs the Forum on Geonomics and helped prepare a course for the UN on geonomics. To take the “Land Rights” course, click here .

Also see:

Job Insecurity

Bankers Enjoy Economic Security Beyond Jobs

Bad Comparisons Make for Bad Conclusions

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