From the Economist: Vanishing Workers

There is no "downward pressure on wages" in Germany, who are some of the highest paid in Europe. See average wages at the OECD site here:

The average German wage was $40.5K (Dls US at PPP) in 2015 and $30.5K in 2005, so a steady progression over the past ten years - or 3.3% per year. We can't say that for the US, where it was 2.6%.

Germany is going full-bore with the workers it has. It hasn't adopted that many "migrant workers" and I'll bet the hundred or so who have found jobs are really quite qualified with both English and advanced degrees.

So, they are picking the good-fruit from the bottom limbs. Higher up will be more difficult, but with Germans retiring the migrants will also be employed inevitably. It is simply a question of time ...

 

I was responding to Econ4Every1's comment.

 

BRAVE NEW WORLD

The "tide of automation" has been around long, long before you and I arrived on this planet.

We humans cope with it, and move on - only some better than others. There is NO WAY to avoid it - it is a "force of mankind". The will to improve what we do and how we do it is innate in our species.

I don"t know how many times I must repeat this basic truth: We are exiting the Industrial Age, thus Manufacturing constitutes barely 20% of our GDP. Of that, only a fraction requires the most basic skills for production lines of the kind that started "automating" more than 30 years ago. (Yes, those robot car-painting devices were around more than two decades ago.)

(True Story: My parents worked in plastic manufacturing plants in central Massachusetts that were "automated" to South Carolina, then Mexico and now China. A WalMart now covers the ground where they worked for Foster Grant.)

Why? Because the American consumer wanted ever cheaper plastic sunglasses.

So, as an economist, whenever I study the matter of "Industrial Automation", I always think first and foremost about my own personal experience in the matter.

And Donald Dork will only make a much-publicized dent in the matter with his present sloganizing of "Made in America" - because given the choice, history proves that Americans select the cheaper product blindly.

MY POINT?

So, I say, "Enough of the blatant nonsense". Let's recognize the world that surrounds us for what it is. And commit ourselves to educating our children for this Brave New World with a far better set of qualifications free, gratis and for nothing.

Exactly as Bernie and Hillary had proposed.

And we stoopidly chucked out the window in this last election ...

 

Btw, those plants that were destined to be built in Mexico were all "highly automated", the sophisticated automated production machinery coming mostly from the US. Which, now, will not get built in the US and shipped to Mexico ...

So, do not expect any cheaper cars for quite a few years to come. Unless you buy less expensive cars built abroad. Can't happen?

That's what they said (here in Europe) about Suzuki cars built in India today and now sold in Europe ...

 

And so?

Could I have the point you are trying to make, please ... ?

 

Work is natural for humans but it must be work that individuals can do. Even processing work which for me at least appears to be extremely boring is okay for some people who don't mind the drudgery as they can socialise at work which makes it bearable. Some high level skilled work will not be done by robots (at this time anyway) so it's likely robots will continue to do the boring work. What do we do with those who would have been prepared to do that work?

 

I agree. But most work takes some kind of training to perform, and the more sophisticated the work, the more preparation is necessary.

And it is up to the state/government to provide it. Free, gratis and for nothing - Primary, Secondary, Tertiary.

The rest is up to the individual ...

 

Relative to history, neither industrialization nor automation have had a really long run. Particularly the (US) hayday of the wage job is arguably a 20th century episode. I suggest that automation goes far beyond industrial applications and that it doesn't work in isolation. There are bedmates like more perfect markets and information, more accessible history, and public best practices that make for less work to do each time around - less likelihood that a human's involved and less likelihood that it will be a human collocated with the consumer.

The US has a seasoned luxury market. This is an even more likely place to sell the same thing for a higher price through a different presentation than I presume of Europe, for example. We certainly try it more than Europeans who's retail markets lack the sort of variety that's common in US merchandising, then we have a concept of an upscale version of everything here.

As you say 'history proves' I question your take on history.

 

AMERICA'S BRASS RING

And you have every right to do so. That's what makes for interesting exchanges in this forum.

The history of invention goes back a long, long way - even before Roman times, when the impulse was greater. Then, of course, came the Dark Ages when societies regressed. Only to improve in the Age of Enlightenment. Progress has never been entirely smooth.

Whether the US is more adept at merchandising or not is a good question, but also somewhat moot. Each agglomeration (nation or nation-states) assumes the role it has to play to meet Consumer Demand. The US GDP in the aggregate is lesser than the EU, but GDP per capita is higher.

This last comment is significant. The US has a more productive market-economy with few consumers. Yes, that's a fact.

But that does not mean it is first and foremost in capacity to develop its economy. I maintain that the lack of free Tertiary Education is a major hindrance for the American economy. Then, of course, there is also the unexpected that affects economies - like the SubPrime Mess that nobody saw coming - but created the most significant Great Recession since the last one in the 1930s. Nothing has been done really to address that problem, and for as long as upper-income taxation is low, then people will be induced into taking risk in the hopes of snatching the Brass Ring on the Merry-go-round of capital markets.

As for ameliorating our production capacity by enhanced education of our young, the one chance it had to "fix the problem" was with Hillary's proposal of free Tertiary Education. Whereupon the American electorate just shot itself in both feet. With consummate stoopidity, American voters refused Hillary's proposition in favor of Donald Dork.

The man who sloganized his way into the presidency by "tweeting".

Heaven help the USA. Time will tell. It always does ...

 

I am pretty sure that I spend over a thousand hours per year
volunteering my time on some form of internet discussion forum
and I would sure like to think that this is of some benefit to at
least some people.

http://www.politicalforum.com/opini...eory-modern-world-problems-even-possible.html

Is a Unified Theory of Modern World Problems even possible?

 

I'm not even sure what that means...lol

I'm sure we could hit on the broader points, but when you start getting down in the "weeds" I suspect the wheels will start falling off...lol

 

Here is a simple summary of my UTMWP!

1. The collapse of the West Antarctic Ice Sheet threatens all coastal communities.

2. Desalination of ocean water on a large scale diverts water out of the oceans... .which
protects coastal communities.

3. Large scale desalination of ocean water produces food... and the earth has one billion hungry people.

4. Those people need money to buy food...... turning deserts green creates jobs for them.....

5. Dr. Leo Rebello postulates by adding over eighty trace minerals to food for about one dollar per person per year many serious diseases could be reduced..... assisting us to be able to work productively for more years.

6. Diverting water out of oceans through desalination of ocean water could turn out to be far more cost effective than building sea walls and dikes.

7. Turning the nations of Jordan green could set an example of another Middle Eastern nation
being peaceful and improving their economy... .which could spread to other nations there.... which could be good news for all nations with new immigrants who have some terrible ideas on what is ethical... and what isn't.

And all of this could theoretically be financed..... through more of..... or a better form of... MONEY?

 

WANDERING IN THE DESERT

The infographic comes from the Economist, here.

Be my guest ...

Not if those fewer workers are obtaining the right credentials.

The problem in America is the high-cost of postsecondary degrees. The average student is graduating with a debt of somewhere around $30K. That's shocking.

America has a problem with "free-things", that Europe does not have. Largely because the latter believes that "free-things" (like a National Health Care and Tertiary Education) are not the services that a market-economy delivers best.

"Best" meaning to a large number of individuals at an non-exclusionary cost.

I delved recently into the Dept. of Education statistics. What I found is worrisome. Namely, that if we graduate 85% of all high-schoolers, of that number we only graduate 44% with a postsecondary degree (vocational, 2- or 4-year). And one of the most prominent barriers is the cost of tertiary education.

So, we are repeating the same argument that was had at the beginning of the 20th century when many people thought that secondary education was "unnecessary".

MY POINT

We shot ourselves in the foot by not electing Hillary, whose trademark legislation would have been free tertiary education for all families earning up to $100K a year at a state school of higher learning. That enhancement of skills/competencies would have prepared our youth for the challenges of the Information Age.

We've left them wandering in the desert ...