Thursday, March 17, 2016

A note on jobs

We face an employment problem. Not the one Donald Trump refers to when he talks about bringing manufacturing jobs back. Those jobs do not add much value any more. I’d argue we don’t want them back.

Take, for example, what happened to US auto manufacturers who paid far more to assembly line workers than those workers were worth: Bankruptcy. They had to lay off workers, screw over bondholders, suck-up taxpayer dollars and, in 2007, implement a two tier wage.

Entry-level auto-workers get $15.78 to $19.28 hourly. Slightly above what the economically ignorant are now demanding for flipping burgers.

Full rate auto-workers get $28 an hour. The top tier also provides better benefits, including a pension instead of the 401(k) entry-level workers get. The total difference in the two compensation scales is about $20 an hour.

How much value is added by screwing in a sensor (200 times a day) that will keep cars from crashing into each other? What value is added by designing that sensor? Which job do you want?

If Mexicans and Chinese do those rote assembly jobs for less than UAW wages and benefits, is anyone surprised? Are they still “good jobs?” Is doubling the wages of an entry level UAW worker in Detroit sustainable?

How many of you would appreciate a doubling in the cost of a new automobile, or a $9 McDonald’s fish sandwich?

Those jobs, within our lifetimes, will mostly be done by robots. Then who will Trump blame?

Donald Trump's jobs "plan" is like insisting we bring back jobs manufacturing buggy whips.

No comments: