Home > Uncategorized > Where have all the workers gone?

Where have all the workers gone?

from David Ruccio

employment-incomes

U.S. capitalism has a real problem: there don’t seem to be enough workers to keep the economy growing.

And it has another problem: capitalists themselves are to blame for the missing workers.

As is clear from the chart above, the employment-population ratio (the blue line) has collapsed from a high of 64.4 in 2000 to 59 in 2014 (and had risen to only 60.1 by the end of 2017).* During the same period, the average real incomes of the bottom 90 percent of Americans have stagnated—barely increasing from $37,541 to $37,886.

That should be indicator that the problem is on the demand side, that employers’ demand for workers’ labor power has decreased, and not the supply side, that workers are choosing to drop out of the labor force.

But, as I explained back in 2015, that hasn’t stopped mainstream economists from blaming workers themselves—especially women and young people, for being unwilling to work and turning instead to public assistance programs and raising children and being distracted by social media and digital technologies, as well as Baby-Boomers, who are choosing to retire instead of continuing to work.

So, which is it?

Katharine G. Abraham and Melissa S. Kearney have just completed a study in which they review the available evidence and their conclusion could not be clearer:

labor demand factors, in particular trade and the penetration of robots into the labor market, are the most important drivers of observed within-group declines in employment.

table3

Over the course of the past two decades, U.S. capitalists have decided both to increase trade with China (through outsourcing jobs and importing commodities) and to replace workers with robots and other forms of automation (it is estimated that each robot installed displaces something on the order of 5-6 workers).

That’s the main reason the employment-population ratio has declined so precipitously and that workers’ wages have stagnated in recent years.

Clearly, U.S. capitalists have been remarkably successful at increasing their profits. But they have just as spectacularly failed the vast majority of people who continue to be forced to have the freedom to work for them.

 

*The Bureau of Labor Statistics defines the employment-population ratio as the ratio of total civilian employment to the 16-and-over civilian noninstitutional population. Simply put, it is the portion of the population that is employed. Thus, for example, in 2000, the total number of civilian employees in the United States was 136.9 million and the figure for the civilian noninstitutional population was 212.6 million. By 2014, the civilian noninstitutional population had grown to 247.9 million but the total number of workers had risen to only 146.3 million. The employment-population ratio differs from both the unemployment rate (the number of unemployed divided by the civilian labor force) and the labor force participation rate (the share of the 16-and-over civilian noninstitutional population either working or looking for work).

  1. culturalanalysis.net
    February 28, 2018 at 1:19 am

    So it is actually the outsourcing to China that is the biggest factor in employment reduction, nitbthe robots. And therefore the same jobs in China are not replaced by robots. That in itself is an interesting fact. I am of the opinion that the service economy is indestructible, at least in the foreseeable future. There’s always a need for another human to communicate with you and understand you, your feelings, your frustrations etc.

  2. February 28, 2018 at 2:50 am

    It is funny that economists nowadays believe that it is impossible to have a healthy, growing economy without exporting (at least on the developing nation side of the equation. Then the very same economists turn around and say that demand can never be the limiting factor for growth because it is harder to make things than consume them. If buying things was indeed easier than making them on a national level then rapidly growing developing nations would all be importers.

  3. Rob Reno
    February 28, 2018 at 2:53 am

    No doubt my data in anecdotal, but when I disarticulated the predatory global supply chain for the high-tech field I spent a fair amount of time going to Meetups for this category of workers and talking with them. Many are leaving the field because they know they are being screwed and are tired of being a part of such a abusive predatory supply chain that consists of a transnational network of high-tech sweatshops trading in “contingent” workers who were shed by lead tech companies (see David Weil’s Fissured Workplace). Hell, I refuse to work in that industry any longer and would only consider creating a startup aimed at destroying their business model with a disruptive better one. (See my comments: https://rwer.wordpress.com/2017/10/04/the-workplace-a-few-charts/)

    • Rob Reno
      February 28, 2018 at 2:59 am

      I had access to internal bill rates from the lead tech company and the pass thru rate used by the third party “staffing” companies, hence was able to model the pro forma financials for a five year business plan. What was done to the American blue-collar (low wage low skill) workers is now being done to the white-collar (high wage high skill) workers and nobody is other than Weil and a few others are even talking about it.

    • Rob Reno
      February 28, 2018 at 3:39 am

      These global supply chains are sometimes vertically integrated with the Indian company owning the “recruiting process outsourcing” (RPO) service as well as the US body-shop incorporated in the US. And US Corporations work closely with them in this predatory supply chain the purpose of which is to wage scalp highly educated workers (nurses, software engineers, etc.) In Vision Information Systems case they were not even a legitimate registered corporation in the United States. It was just some Indian working out of his home pretending to be a legitimate US corporation. I have the letter from the Secretary of State attesting he flat out lied to me. This is corrupt and is the true nature of capitalism today. And it isn’t anything like the BS models being pushed.

      See: https://youtu.be/dkAparIQXN4 and https://youtu.be/G4TN3caBMxg

      • Rob Reno
        February 28, 2018 at 3:44 am

        After providing Senthil the digital forensics proving he was lying to me he sent an email admitting he was lying and trying to make excuses, etc. This is happening to highly skilled workers all over the world, not just here in the US.

    • Rob Reno
      February 28, 2018 at 3:49 am

      We watched our friends shed by Microsoft end up in one of these high-tech sweatshops, losing over 60% of their net income but returning to Microsoft to do the same job they were doing before. Is it any wonder people tire of this predatory rigged market and just leave an become those Lucas and ilk like him say are just choosing “leisure” over work.

  4. Craig
    February 28, 2018 at 4:18 am

    Think the new monetary and economic paradigm of Direct and Reciprocal Monetary Gifting….and the acculturation of leisure which is self chosen directed purposeful attention….not idleness.

  5. Norman L. Roth
    February 28, 2018 at 6:13 pm

    Hmmm !
    Sounds like chapter Four of TELOS & TECHNOS: About the causes of decline in the Natural Participation rate {Nr}..Plus a bit of ‘progressive’ conspiracy topping:
    e.g. ‘Capitalists themselves are to blame for the missing workers’. The paradigm that dare not speak its name has passed another “falsifiability” test. But this sort of Kuhnian paradigm criteria evidence has been pouring in for decades: Especially on Nr. Thanks any way guys.
    You may be an unexpected confirmatory source. But you’re on the right track…Sans some of the other stuff.
    GOOGLE: Norman L. Roth

  6. March 1, 2018 at 2:09 pm

    None of this is surprising considering the history of work and workers in America. In her book, “Masterless Men, Poor Whites and Slavery in the Antebellum South,” Keri Leigh Merritt quotes this from Hinton Helper (1857).

    The liberation of five millions of ‘poor white trash’ from the second degree of slavery, and of three millions of miserable kidnapped negroes from the first degree, cannot be accomplished too soon … It now behooves us to take a bold and determined stand in defence of the inalienable rights of ourselves and of our fellow men, and to avenge the multiplicity of wrongs, social and political, which we have suffered at the hands of a villainous oligarchy … If to-day we could emancipate the slaves in the Union, we would do it, and the country and everybody in it would be vastly better off to-morrow. Now is the time for action; let us work.

    And this from J.F. Palfrey (1848)

    The slave-holder knows wherein lies his power to enslave one class and trample upon another. He scatters abroad prejudice … And in order to do this, he scatters abroad ignorance, shrouding the whole region in a veil of mental darkness, debarring the poor freeman from the opportunity of educating his children; for ignorance, prejudice and crime are a triumvirate of tyranny, acting and reacting upon, producing and re-producing each other.

    Workers in American history come from one of two sources. Slaves and whites who took virtually any job for any wage since they recognized they could be replaced by slaves any time. A few times this dynamic has been slowed or even stymied. But today’s slaves (the robots) and desperate non-robot workers show us it has never died. They also show that the modern “slave-holder” is still adept at enslaving and trampling workers through the triumvirate of tyranny: ignorance, prejudice, and crime. Helper was persecuted and feared by 19th century slave-holders who per Merritt went as far as secession to escape him. It’s no surprise that’s today’s slave-holders ally themselves Russia and American Nazis to remake the US to preserve their political power and wealth. My message, take today’s slave-holders seriously. Their intent is to destroy capitalism, and even democracy in America if necessary to get their way.

  1. No trackbacks yet.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.