Where will they go?

SixNein

While people enjoy their Friday, I'm stuck in a small room staring at set theory, linear algebra, and statistics. On that note, I came across an interesting statistic that claimed 60% of jobs over the next decade will require a college education. But I wonder... how will people without a college education survive? Manufacturing isn't dead; however, technology is automating the jobs people with high school degrees use to fill. Where will they go now?

The short answer is that I truly don't know. The longer answer is that I suspect people with a high school education or lower is now in a race to 3rd world living standards. They are, to a degree, in direct competition with 3rd world wages. I say to a degree because sometimes pay isn't as large of a factor as delivery time, etc..

On a side note, I do think its interesting that so many people with a high school education vote republican.... don't you? lol

ThomasT

I don't know what will become of them either. But it seems to me that America can look forward to a persistent, and perhaps increasing, unemployment rate greater than today's in future decades. Which would seem to entail either a vast welfare state, or massive abject poverty. I'm not optimistic.

Vanadium 50

One needs to look carefully at that report. It says by 2018 63% of openings will require some college education. That's a category more inclusive than "associates degree" and technically covers taking only one college class. The 2007 number is only 3 percentage points lower. This also covers job openings, and not just entry-level positions: a factory foreman may well be expected to have more education than someone just starting out - and the aging demographic . So there is no abrupt transition - this is a function of continuing trends and demographics.

That said, recessions and unemployment hit people with less educational attainment harder. The BLS said that the average unemployment rate for 2010 was 8.2% amongst the general population (we can quibble about what this number means, but the trend is inarguable), but only 1.9% among people with doctorates and 14.9% for people without a high school diploma, and a clear trend.

It is difficult to get precise numbers, but there are something like 10 million non-English speakers in the US. Unemployment in this group may be as high as 30%, or even higher.

If someone supporting the Democrats sneered and laughed at me, I would certainly question whether that party best served my interests. This doesn't sound like irrational behavior.

MarcoD

Bernanke claimed that the US should be able to, or will, sustain a 5.2 unemployment rate for the foreseeable future.

The balance of trade needs to reverse some time, which will bring jobs, so I wouldn't worry about it too much.

Elihu5991

I don't blame the people with just highs school education. These people aren't supported and shown how to live life. Most of them are from derelict communities; not shown any hope in life. Then again, some on the other hand, waste their life away, yet they are hurt. For some, not everyone is destined for university and all, everyone has their destiny and the hobbies. People who enjoy cleaning should have the right to work as a cleaner and not be condemned and paid little. A doctor is no better than a cleaner ... we can't live without cleaners as much as doctors. This requiring a degree thing is going to cause HUGE problems.

russ_watters

I definitely agree. I do, however, blame [most of] the people who didn't even finish high school.

SixNein

I disagree. At one time, a person could cut out a decent middle class life if they were willing to work. They could start out on a factory floor doing some assembly, and eventually, they could move up the company ladder. But there has been a change. In my opinion, we have reached some kind of technological equilibrium. And it should make anyone regardless of education feel uncomfortable. Since there are so many different things that can be automated, I don't think that there are many safe jobs. And even the safe jobs are at high risk of being outsourced.

feathermoon

There is a study or two I'm sure showing a person's contribution to the overall economy, with a correlation between education and value. This supplies a governmental impetus to ensure everyone can go to college. But, I bet 50% or greater of these 60%+ percent of jobs that will require some college education won't really. Its just become a way to cut down on applicants, which doesn't help anything in the overall economy, in my opinion.

ThomasT

I think that a big part of the problem is that a large portion of America's manufacturing base, that used to employ lots of people with just high school educations (and even a lot of high school dropouts), simply doesn't exist any more. It's been replaced by automation and foreign labor. In the three areas that I've spent most of my life I count about 80 factories, in dozens of industries, employing approximately 120k people that are shut down ... apparently forever.

The US is increasingly becoming a service based, not a manufacturing based, economy. And a significant portion of that is financial services, and technical services, a significant portion of which are outsourced to cheaper foreign labor.

This is very good for the financial sector, and lots of corporations, but bad for America in general, imho. Yet, it's the US government which has promoted and subsidized this trend.

As I said, I'm not optimistic.

I'll repeat what I said in a previous post. America, the US, is facing the prospect of becoming a vast welfare state, or vast abject poverty.

The problem isn't going to just solve itself. Current trends will continue if neither the congress nor the administration is concerned with changing the trends.

Ryan_m_b

The UK has done this as well especially in finance (the square mile amongst other places in London is one of the biggest financial centres of the world) which is great when the financial sector is doing well and a pain in the neck when it isn't.

As for the problem of "unskilled" labour it is a big one. I can't see the UK (or many other developed countries in the same situation) getting out of it without massive investment in manufacturing and training programs. Problem is I wonder if that would make much of a difference because we still probably wouldn't be competitive with industry out-sourced to less developed countries. If you install the same factories, same training programs etc you can still do it for cheaper in a country where rents are cheap, taxes are low and the average person is desperate enough to work for wage that would be illegal in the UK.

Zarqon

I always find it a bit paradoxical to say that "unemployment" due to factories becoming automated is a bad thing. I mean, no one really wants to stand in a factory all day doing monotonous tasks, so the more these things can be automated the better!

That being said, our current model for how to redistribute the wealth of our society to everyone (also to people who have no more tasks to do) isn't quite there yet, when we can take advantage of it properly. My feeling is that the welfare state concept will (have to) be expanded in the short term future to accommodate for this, until we can find a more positive arrangement of the society.

Ryan_m_b

I agree though my point about manufacturing is that we wouldn't have so much unemployment now (and not be in such a bad economic situation).

Tosh5457

Yep the problem is the redistribution - if factories become more and more automated, it means the profits will go to fewer people. But giving money to people who don't work for a long time (not arguing against unemployment subsidy) isn't a good idea, so the redistribution couldn't be by subsidies. State-owned factories wouldn't be very good either, because state-run enterprises usually don't go well for a variety of reasons. But meanwhile the capitalist class doesn't care about this, and will fight against anything and anyone who attempts to change this.

Ryan_m_b

It's sort of a moot discussion because without having the technology it's hard to see all the ramifications. Having said that I'm not sure if I agree to the statement of giving money people who don't work for a long time because what if the situation is that for years there are not enough jobs to go around? I agree it's not fair if people have no intention of ever working and instead just live off of benefits but in a situation such as the one the UK currently finds it in there are literally not enough jobs to go around.

Also state-owned factories could potentially work; there are many examples of state-owned institutions that work worldwide but that's a bridge we'd have to cross if we get to it. Perhaps some form of co-operative venture e.g. the residents of a town club together and build an lights-out factory/fablab to service some of the town's needs. Of course any action is going to depend on the sophistication of the technology we are talking about.

Tosh5457

Neither do I, like I said it's just a bad idea.

They'd have to compete with the private factories, so they'd have to do the same thing: automate the process to get more profitability.

Ryan_m_b

Hmm the way I see it the competition would be intellectual; who has the best designed factory and who has the bigger and better library of intellectual property. It may be that a private company could offer an individual a product that the state lacks the IP to make, or perhaps paying fees to a private company ensures products get made and delivered faster (and to a higher quality) than the state-owned that are paid through taxes.

Of course the way to compete would be regulation of IP law and massive funding of public institutions (from individuals to universities) to come up with better automation and product designs.

To avoid going to off-topic the question in this situation becomes how people can pay for goods if the industries they need to buy from are the ones causing the mass unemployment. Somehow a viable post-industrial economy/society would have to be created. Arguably the US is close to that today; looking at this graph it seems that only ~10% of the work force is employed in primary and secondary sectors of industry.

Tosh5457

Just a remark, Clark's model is impressively accurate Do you know how does it work? Does it make the prediction based on last year's results, or it made all the predictions at once?

Yes a new economic system is needed. The current trend of capitalism in US and Europe, which has been going since the 80s, is the financialization of the economy and monopolization, and that hasn't been working very well and it won't work in the long term.
A new system will appear, even if it takes an unemployment rate of 30% or 40% for the economic thinking to change direction.