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Thread: Technology causes high unemployment?

  1. #31

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    Quote Originally Posted by Zippyjuan View Post
    That assumes additional demand existed for your widgets. Say the demand for your widgets did not change but technology still improved your productivity by 50%. That means you need fewer people to produce them so you lay off workers- you could get rid of one third of them and still maintain current production. But those workers were buying your widgets. Now they aren't because they don't have a job. Now you are selling fewer so you again need fewer workers. More layoffs.

    We have seen that happening with our economy in recent years. Companies started laying off workers (a lot of the early cutbacks were not because companies were themselves actually losing revenue but because they EXPECTED lower sales due to the recession hitting). Now there are more people not working. They have less to spend on buying stuff so sales of goods and services go down. These same companies see the sales declines and trim the workforce further. It is very hard to get the cycle to reverse itself and get business to hire and give people more money to spend again which increased demand for goods and services which encourages more hiring.
    This isn't complex. Make it easier for people to start their own businesses and create jobs that way. Big corporations are not obligated to give away free jobs.



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  3. #32
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    If you are going to start or expand a business, you want to have a good chance of being profitable. If the economy is slow and unemployment is high, the chances of success are lower and you will be less likely to invest in that enterprise. You too will be watching to see if things are getting better before you expand.
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  4. #33

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    Quote Originally Posted by Zippyjuan View Post
    If you are going to start or expand a business, you want to have a good chance of being profitable. If the economy is slow and unemployment is high, the chances of success are lower and you will be less likely to invest in that enterprise. You too will be watching to see if things are getting better before you expand.
    That's what losers do. Downturns in the economy make it easier for startups to find qualified workers. There have been many successful companies that have started in recessions. The trick is to convince investors the world isn't over.

  5. #34

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    Quote Originally Posted by Zippyjuan View Post
    That assumes additional demand existed for your widgets. Say the demand for your widgets did not change but technology still improved your productivity by 50%. That means you need fewer people to produce them so you lay off workers- you could get rid of one third of them and still maintain current production. But those workers were buying your widgets. Now they aren't because they don't have a job. Now you are selling fewer so you again need fewer workers. More layoffs.
    That assumes that the workers are indeed buying their own widgets, and that it's a closed-loop economy. Conversely, would the key be to success be to hire more employees, so that they can buy more widgets, and you can then use those profits to hire even more workers?

    The lay-off of workers due to solely to efficiency or technological improvements is at the very CORE of the concept of division of labor and efficient allocation of resources. You see those workers as simply out of jobs due to technological improvements. I see them as "free" to be allocated more wisely, now that labor is not being WASTED by the amount indicated by the prior inefficiency.

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    Quote Originally Posted by tttppp View Post
    That's what losers do. Downturns in the economy make it easier for startups to find qualified workers. There have been many successful companies that have started in recessions. The trick is to convince investors the world isn't over.
    Yes, the workers are there. It is the would- be buyers of your product you must convince. That is harder when people have less money and are worried about their own jobs.
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  7. #36

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    Quote Originally Posted by Zippyjuan View Post
    Yes, the workers are there. It is the would- be buyers of your product you must convince. That is harder when people have less money and are worried about their own jobs.
    Startups are less worried about that since they usually lose money the first few years anyways. The best thing to do is start a business during a downturn, then profit big time when the market gets better.

    What you can't do is turn your life off when the market gets bad. That's what separates the rich from poor. Rich people know the real work gets done during recessions. That's what sets you up for success when the market gets better.
    Last edited by tttppp; 10-18-2012 at 08:13 PM.

  8. #37
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    No amount of automation can eliminate jobs... if it ever gets to that point, the robots will just kill us because we're useless
    It's all about taking action and not being lazy. So you do the work, whether it's fitness or whatever. It's about getting up, motivating yourself and just doing it.
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  9. #38
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    Quote Originally Posted by Steven Douglas View Post
    That assumes that the workers are indeed buying their own widgets, and that it's a closed-loop economy. Conversely, would the key be to success be to hire more employees, so that they can buy more widgets, and you can then use those profits to hire even more workers?

    The lay-off of workers due to solely to efficiency or technological improvements is at the very CORE of the concept of division of labor and efficient allocation of resources.
    Widgets could represent the economy as a whole- not just a single product. Displacing workers is not as big of a problem if there are new jobs for them to go to. It is tougher to find a replacement right now. Even if you get training. You are right that the market will cause displacement due to improvements in efficiency as a normal part of business. Henry Ford paid his workers more money so they could more easily afford what they were making- and he sold a lot more cars becasue of it. But a business does not care about the broad economy (aside from how it will impact his own revenue). He won't take actions which may help everybody out- he will do what he can to maximize his own profits. If you could somehow (and you can't) enourage every company to increase their payroll by one percent, the overall economy would grow by more than one percent. If I get a raise, I have more money to spend at the hardware store and he then has more money to spend at the grocery store or whereever.

    You see those workers as simply out of jobs due to technological improvements. I see them as "free" to be allocated more wisely, now that labor is not being WASTED by the amount indicated by the prior inefficiency.
    The unemployed will be happy to hear this. I am sure it will cheer them up.
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  10. #39
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    Quote Originally Posted by tttppp View Post
    That's what losers do. Downturns in the economy make it easier for startups to find qualified workers. There have been many successful companies that have started in recessions. The trick is to convince investors the world isn't over.
    True. I was just point out why it is less likely to happen.
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  11. #40

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    Quote Originally Posted by Zippyjuan View Post
    Widgets could represent the economy as a whole- not just a single product. Displacing workers is not as big of a problem if there are new jobs for them to go to. It is tougher to find a replacement right now. Even if you get training. You are right that the market will cause displacement due to improvements in efficiency as a normal part of business. Henry Ford paid his workers more money so they could more easily afford what they were making- and he sold a lot more cars becasue of it. But a business does not care about the broad economy (aside from how it will impact his own revenue). He won't take actions which may help everybody out- he will do what he can to maximize his own profits. If you could somehow (and you can't) enourage every company to increase their payroll by one percent, the overall economy would grow by more than one percent. If I get a raise, I have more money to spend at the hardware store and he then has more money to spend at the grocery store or whereever.



    The unemployed will be happy to hear this. I am sure it will cheer them up.
    Why does a job have to be provided for everyone? The whole point of America is we have the option to work for ourselves.

  12. #41

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    Quote Originally Posted by Zippyjuan View Post
    True. I was just point out why it is less likely to happen.
    There are still obstacles in downturns, but that's largely due to the elite cutting off funds from everyone else.

  13. #42
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    Quote Originally Posted by tttppp View Post
    Why does a job have to be provided for everyone? The whole point of America is we have the option to work for ourselves.
    This is true.

    That's also good advice for young people looking for work. Don't get locked into a career where you'll be unable to use your skills without an employer
    It's all about taking action and not being lazy. So you do the work, whether it's fitness or whatever. It's about getting up, motivating yourself and just doing it.
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  14. #43

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    I chuckle when the politicians speak of bringing manufacturing jobs "back" to the U.S. We should want to export those jobs. And, yes, Americans suck at updating their job skills.

  15. #44

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    Quote Originally Posted by anaconda View Post
    I chuckle when the politicians speak of bringing manufacturing jobs "back" to the U.S. We should want to export those jobs. And, yes, Americans suck at updating their job skills.
    I laugh when they talk about bringing those high paying manufacturing jobs back. Who ever wanted to work at a factory?

  16. #45
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    Quote Originally Posted by anaconda View Post
    I chuckle when the politicians speak of bringing manufacturing jobs "back" to the U.S. We should want to export those jobs.
    I disagree. While we shouldn't subsidize manufacturing, it would be preferable to have the manufacturing here. We don't want to be manufacturing Nike's though. Unless it was almost entirely automated. Though its probably still cheaper to get kids to make it than automate it.

    We want skilled manufacturing jobs. Manufacturing custom & complex electronics and equipment. And automate as much as possible.

    That's being picky though. We could use any kind of manufacturing really. As it stands our three biggest professions are moving money around, moving digital bits around, and moving digital money around.

    Manufacturing on the other hand is tangible, and exportable.
    It's all about taking action and not being lazy. So you do the work, whether it's fitness or whatever. It's about getting up, motivating yourself and just doing it.
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  17. #46
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    Quote Originally Posted by tttppp View Post
    Why does a job have to be provided for everyone? The whole point of America is we have the option to work for ourselves.
    I don't say they have to. But more people working means more wealth for everybody.
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  18. #47

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    Quote Originally Posted by Zippyjuan View Post
    Widgets could represent the economy as a whole- not just a single product.
    I don't even acknowledge the economy "as a whole" as meaning anything. That's the kind of thinking that got our aggregate theoretical statist manipulators' engines revved in the first place.

    Displacing workers is not as big of a problem if there are new jobs for them to go to.
    That's the other thing I can't buy into, and that is the perpetual focus on 'jobs', as if everyone's productivity should automatically be reckoned in terms of which subservient dependency slot, in someone else's going concern ought, to be created for them.

    It is tougher to find a replacement right now. Even if you get training. You are right that the market will cause displacement due to improvements in efficiency as a normal part of business.
    Once again, that's not due to efficiency or technology improvements, but rather a thoroughly corrupt fiat currency and monetary policy.

    Imagine if the tax code was suddenly revised so that it read less than 1,000 words total, was unambiguous and required absolutely no interpretation by millions of tax attorneys and accounting wizards across the country. Entire industries in the billions of dollars, which really are nothing but a waste of mis-allocated human resources and talent, would no longer be necessary--rightfully out of "work" that really is overvalued and unnecessary. In addition to freeing up income for allocation elsewhere (by those having to pay the tax clergy), is that really a lot of people out of work, or is really just a lot of wasted labor that finally has to think in terms of real value under a paradigm that finally got a bit more real?

    Likewise, a lot of construction workers were employed strictly from malinvestment resulting from the artificial housing boom, no differently than all the people employed by the dotcoms during that bubble. When the entire economy goes through a monetary crash, everyone is affected. The fact that unskilled labor hurts the most is just one more reason to bitch-slap all the Theoretical Manipulators In Charge into the middle of the next millennium. Because the problem isn't that people are out of work, so much as millions of people were put to work and made dependent on a FALSE ECONOMY laden with FALSE VALUE EXPECTATIONS.

    Henry Ford paid his workers more money so they could more easily afford what they were making- and he sold a lot more cars becasue of it.
    I'm sure he did, in a mass production auto industry still in its infancy. What Henry Ford really did was EXPLOIT the cost difference between hand-crafted autos that were cost prohibitive to all but the most elite, and THROUGH TECHNOLOGY (mass production logistics being one), was able to pay more...for a time. But his employees were the smallest part of his market.

    Likewise Disney wanted Disneyland to be affordable for the average family as well. Great sentiment for a new sensation in a decidedly smaller popuation, and it was affordable -- for a time. But market supply and demand realities soon set in. You could give away park tickets today at $20 a pop, and it would certainly attract more park visitors -- by the hundreds of thousands. But that would hardly be a good thing.

    But a business does not care about the broad economy (aside from how it will impact his own revenue). He won't take actions which may help everybody out- he will do what he can to maximize his own profits.
    Nor should they do otherwise, and which, according to Adam Smith and others, is a good thing. It's only when that self-interest extends beyond self-interest and succeeds in reaching out to the state for protections and privileges under color of public interest that problems arise.

    If you could somehow (and you can't) enourage every company to increase their payroll by one percent, the overall economy would grow by more than one percent. If I get a raise, I have more money to spend at the hardware store and he then has more money to spend at the grocery store or whereever. The unemployed will be happy to hear this. I am sure it will cheer them up.
    Why stop at 1%? Why not encourage every company to increase their payroll by, say, 50% of their existing profits? And what if, further, you could convince them to do this without raising prices? And further still, you could accomplish this with publicly traded companies without scaring away investors? Wouldn't the economy just positively boom after that? That altruistic sentiment is an extension of the broken window fallacy. The very worst part about it is that you are asking for the impossible in a way that runs absolutely contrary to the very free market principles that made division of labor so efficient, and goods and services so relatively inexpensive. You are now asking that a market filled with profit-maximizing individuals and firms actually cause such an artificial dependency to be initiated, let alone set in. What you are really asking for is a market distortion of value itself. That is no different, in effect, than all the value distortions that ultimately resulted in massive unemployment in the first place. Only profit-maximizing, self-interested entities in a truly free and perfectly competitive market can even establish value in the first place.

  19. #48

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    Quote Originally Posted by tttppp View Post
    I laugh when they talk about bringing those high paying manufacturing jobs back. Who ever wanted to work at a factory?
    They are no longer high paying. Politicians offer protectionism and this is always injurious to the economy.
    Last edited by anaconda; 10-18-2012 at 09:09 PM.

  20. #49

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    Quote Originally Posted by anaconda View Post
    They are no longer high paying. Politicians offer protectionism and this is always injurious to the economy.
    I know. That's the point.

  21. #50

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    Quote Originally Posted by Zippyjuan View Post
    That assumes additional demand existed for your widgets. Say the demand for your widgets did not change but technology still improved your productivity by 50%. That means you need fewer people to produce them so you lay off workers- you could get rid of one third of them and still maintain current production. But those workers were buying your widgets. Now they aren't because they don't have a job. Now you are selling fewer so you again need fewer workers. More layoffs.

    We have seen that happening with our economy in recent years. Companies started laying off workers (a lot of the early cutbacks were not because companies were themselves actually losing revenue but because they EXPECTED lower sales due to the recession hitting which actually made it worse and self- fulfilling). Now there are more people not working. They have less to spend on buying stuff so sales of goods and services go down. These same companies see the sales declines and trim the workforce further. It is very hard to get the cycle to reverse itself and get business to hire and give people more money to spend again which increased demand for goods and services which encourages more hiring.
    If we assume the demand curve remains constant (as per your second sentence), and we assume a lower maginal cost, Should not the profit maximizing decision be to increase production? MC=MR.
    Last edited by enter`name`here; 10-19-2012 at 12:21 AM.
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  22. #51
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    Quote Originally Posted by Zippyjuan View Post
    It would still cost to make the robot and service it, transport goods, produce energy, and to provide the materials for the task the robots perform. Everything free? If the robots were free why would they be produced? No incentive.
    You are seriously scaring me Zippy. I was just listening to a Donald Fagen play-list today.
    "Foreign aid is taking money from the poor people of a rich country, and giving it to the rich people of a poor country." - Ron Paul
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  23. #52

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    Quote Originally Posted by torchbearer View Post
    imagine the extreme scenario. you have replicators that make and produce all your food. robot servants to make all your physicals like vehicles, houses, etc.
    human effort is no longer required to provide for anyone's needs.
    zero employment.
    but yet, you have all your time to do what you want, you have home, transportation, food. your wealth is tremendous and you work none.
    technology, increases our production which should lead to falling prices in a word of honest money. the falling prices is an increase in bounty for society.
    I agree, except I don't like to call them "replicators" if you're talking about this kind of thing: http://en.wikipedia.org/wiki/Self-Re...dular_Robotics

    Basically, we might be be nearing completion of a "robotic" system that's universal and utility oriented:


    Here's a version that I'm working on (a geometric "mock-up"):


  24. #53

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    Quote Originally Posted by torchbearer View Post
    if robots produce everything, prices are zero.
    I agree; the general concept involved is called "post scarcity": http://en.wikipedia.org/wiki/Post_scarcity

  25. #54

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    Quote Originally Posted by Zippyjuan View Post
    It would still cost to make the robot and service it, transport goods, produce energy, and to provide the materials for the task the robots perform. Everything free? If the robots were free why would they be produced? No incentive.
    Not necessarily; consider:

    http://www.i-to-i.com/why-do-people-volunteer.html

    http://economix.blogs.nytimes.com/20...you-volunteer/

    http://tribaltruth.org/2010/11/harri...nteering-more/


    This presentation is insightful on the issue:



    A few things I've written related to this subject/issue:

    http://neiltalk.blogspot.com/2012/04...apitalism.html

    http://neiltalk.blogspot.com/2012/04...demand-is.html

    http://neiltalk.blogspot.com/2012/04...-scarcity.html

    http://neiltalk.blogspot.com/2012/05...y-society.html


    This guy's ideas are a bit dated or obsolete, but he makes some good points (not just models or drawings):



    Quote Originally Posted by Zippyjuan View Post
    Reminds me of The Jetsons:


  26. #55

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    Consider the advantage of automation that can cover all tasks, such as building homes, structures, growing crops, cooking food (unless you enjoy cooking), etc. We may just be able to greatly reduce or maybe even end poverty, corruption, crime, need for prisons, need for people to travel to & from work every day (thus less pollution), and people will be free to do what they want.


  27. #56

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    Quote Originally Posted by torchbearer View Post
    why would someone build millions of robots if no one could buy them?
    once people had one robot, their needs are met.
    robot is a replacement for human effort required in meeting life needs.
    I didn't say no one. But you have to create value to get value. I think creating value is going to become more and more difficult. Don't think 300 million Americans will.
    Ron Paul: "For those who have asked, I freely confess that Jesus Christ is my personal Savior, and that I seek His guidance in all that I do."

  28. #57

  29. #58

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    Quote Originally Posted by GeorgiaAvenger View Post
    Temporarily, yes jobs are lost.
    Yes, jobs are temporarily lost, for individuals, until they get retraining in something else or go (back, in some cases) to college so they can get a job in an emerging field or one that has not yet become obsolete. This is a problem (obviously) when you need income to pay bills, have mouths to feed, need a roof over your head, etc.

    Maybe a better question to ask would be: is high unemployment itself necessarily a problem, when it comes to the welfare of the unemployed individuals and society? I think that the answer depends on whether or not people will be able to have food, shelter, transportation, clothes, money - in other words, the things people want and need (i.e., "stuff"), without income; and as a libertarian, I would also add to that question: without forcing someone else to work or taking part of someone else's money to give such individuals "stuff." I think that the answer is that unemployment is a problem only when the result is lack of access to "stuff" by individuals - the reason that people smashed machines when it came to the industrial revolution. I suppose people are not so inclined to smash assembly lines and automation these days because of welfare and some improvements in the quality of life for society; this goes to show that it's not unemployment in itself that's a problem, it's the adverse effect that it has on individuals (who lose their jobs) & their families thus lose access to "stuff." If they didn't lose access to "stuff" and it was because of automation, then I'd say that individuals would want to embrace it rather than have a desire to destroy it.
    Last edited by Neil Desmond; 10-20-2012 at 09:16 AM. Reason: revision

  30. #59

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    ^^^ This.

    I'm always amazed at how badly humans are in general at being 'futurists', as they project scenarios theoretically into the future, often into the vacuum of a LA-LA Land that will never exist, without considering the actual events and steps that got us to the present, and how labor factors in as crucial and indispensable along the way.

    Technology and automation has done nothing but MULTIPLY, not diminish, the need and opportunities for unskilled labor. Every single step of the way.

    If you made a list of all the unskilled labor jobs available in 1900, and compared that with the unskilled labor positions available in the worst times since, leading up to and including 2012, it becomes apparent that the list of the future is orders of magnitude greater, in both quantity and variety. They don't resemble each other at all, and that is ALL due to technology and automation. There were no telephone operator or electronic assembler jobs in 1900, because telephone tech was in its infancy, and there were no electronic devices to speak of.

    What technology and automation does NOT do is guarantee security for any one type of unskilled labor. Wagoners and farriers wanting to remain employed by a transportation industry really did have to re-channel and retrain and adapt themselves to planes, trains and automobiles. When that happens, the unskilled labor cheese also gets relocated. Those who do the heavier lifting and carry water for the more skilled must also likewise adapt. That's not because their services in general are rendered obsolete; only that part of an entire industry that once required them has evolved, morphed and changed into something else.

    ALL AUTOMATION comes from, and is dependent at myriad points, on labor. And always will be. There is no such thing as an automated system that did not arise from labor, and that does not require labor, including unskilled labor. The majority of equipment operators at any semiconductor wafer fabrication plant are UNSKILLED. And no matter how much automation is implemented, the question is NEVER whether or not unskilled labor will be required, but only how it can be most efficiently allocated, and not wasted.

    Automation only refines labor and makes it more efficient and productive; it does not do away with it. And there is no such thing as dispensing with the need for labor, including unskilled labor. Ever. Automated systems require energy and maintenance. Tools are essential, and regardless how refined, how automated even these tools may be, they all require labor, including unskilled labor, to even exist.

    Another point: Complex machines and systems have myriad components that come from different sources. Think of the number of parts and the amount it takes just to make a computer from all its constituent raw materials. There is NO SUCH THING as automated computer design and manufacture, just as there is NO SUCH THING as a disconnect from the positively staggering amount of unskilled labor required in the thousands upon thousands of processes required along the way.

    On the other hand, there are opportunity vacuums going unfilled by the millions for specifically skilled labor.

    [SOURCE]
    “Companies all over are having a difficult time recruiting the kind of people they’re looking for,” said Robert Funk, chairman and chief executive of Express Employment Professionals, a national staffing firm based in Oklahoma City that helped some 335,000 people land jobs last year. “We currently have 18,000 open job orders we can’t fill.”

    How can so many jobs remain unfilled with unemployment so high? One explanation is that many would-be workers lack the necessary skills to fill those positions. “There is higher demand for skilled jobs and less demand for unskilled positions than we’ve seen coming out of past recessions,” Mr. Funk said.
    What the article fails to mention is that problem existed BEFORE the recession. And I lay that one at the doorstep of government involvement in education. They fucked up education the same way they fucked up the health care industry, with all the unintended consequences of protectionist 'accreditation' scams, and government guaranteed student loans and guaranteed funding to education that violated free market principles, and bid it all up so that it is ALL artificially expensive -- even to the point of giving rise to diploma mills and a black market for educational counterfeits.

    So yes, retraining is vital for millions upon millions, but once again, just as with health care, pointy-headed morons are trying to figure out ways to PAY for something that is artificially overvalued from government meddling, and should never have been cost-prohibitive to anyone in the first place, rather than remove all the meddling influences so that the free market can take over and allocated funds with orders of magnitude more efficiency.

  31. #60

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    Quote Originally Posted by Zippyjuan View Post
    That assumes additional demand existed for your widgets. Say the demand for your widgets did not change but technology still improved your productivity by 50%. That means you need fewer people to produce them so you lay off workers- you could get rid of one third of them and still maintain current production. But those workers were buying your widgets. Now they aren't because they don't have a job. Now you are selling fewer so you again need fewer workers. More layoffs.
    If you are producing 50% more widgets for the same cost, then you could afford to lower your prices for widgets significantly. Sure, the laid off people are now temporarily unemployed but the rest of society now benefits from the cheaper widgets.

    Quote Originally Posted by Zippyjuan View Post
    We have seen that happening with our economy in recent years. Companies started laying off workers (a lot of the early cutbacks were not because companies were themselves actually losing revenue but because they EXPECTED lower sales due to the recession hitting which actually made it worse and self- fulfilling). Now there are more people not working. They have less to spend on buying stuff so sales of goods and services go down. These same companies see the sales declines and trim the workforce further. It is very hard to get the cycle to reverse itself and get business to hire and give people more money to spend again which increased demand for goods and services which encourages more hiring.
    What you are talking about here is the result of the GFC not the rise in productivity. This argument of technology leading to mass unemployment has gone on pver a hundred years and has no factual basis behind it.

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