Comments on: The Myth of Job Creation

By: Steve Hunt

Steve Hunt — Wed, 03 Feb 2010 22:39:38 +0000

The point that resonated the strongest with me was the need to stop viewing employment as an “all or nothing” proposition. Aspects of the social safety net such as unemployment benefits and healthcare should not be set up so people loses money as a result of accepting a job. For example, if someone loses a $100,000/year job they should be able to take a job at a much lower salary (say $20,000) without having to totally forfeit their unemployment benefits – at least not immediately. They should not be punished for wanting to work. Conversely, people who choose not to work should get less income than those who don’t mind doing work that might be considered “beneath them”.

Creating a system that makes it easier for people, especially those who are mid-career saddled with kids, morgages ,etc to work part-time or take lower paying jobs so they can move into new careers would do a lot to free up our labor market so people can gradually move from dying parts of our economy to growing areas. We need a system that helps prevent people from getting trapped in dead end careers due to an inability to quit and pursue something else. A 45 year old Detroit auto worker in 2000 might have known that their gravy train was slowing down and would soon stop, but he/she had no way to gracefully move off that train and onto another one that was picking up speed (e.g., biotech) without a significant risk of falling on the tracks between the two moving trains.

What we don’t need is a government that thinks it can “create jobs”. For the most part I’d argue that government will never be able to drive long-term sustainable job growth directly. It needs to create an economic environment that allows for job creation.

By: Bill Hicks

Bill Hicks — Fri, 29 Jan 2010 04:10:27 +0000

Yeah, you’re right. If only those pesky American workers would stop their whining and just magically retrain. It’s that easy, so why don’t they stop the whining? I mean – all you do is just go to college for four years in your early-50s while trying to raise your three children and send them off to college too. Additionally, who’s to say if the job you are re-training for won’t be off-shored by the time you’ve “retrained”? But hey – that’s just those pesky workers whining again. If that happens, just double-down and retrain again. With what money you ask at that point? Since trillions of the public’s taxpayer dollars have been given away to rich bankers who failed miserable, that’s a good question. Really though – stop complaining. You can’t stop the race to the bottom …. er…. uh …… I mean, free trade. So instead of complaining about China’s slave labor, lazy Americans should be offering to give up their remaining few benefits they receive. That pretty much means giving up any and all breaks, including lunch. And those pesky labor laws? If American workers really want to compete in the global economy they should want to repeal all of them. Stop complaining about such cost-intensive items such as a safe workplace. It’s just whining that hurts you in the end.

I could go on, but I think the author summed it up well. Everything is the American worker’s fault and it’s time we recognized that. The sooner the American worker finally admits that their life must be a cradle-to-grave struggle to stay one step ahead the better.

Enough with the whining.

By: David Creelman

David Creelman — Thu, 28 Jan 2010 23:06:12 +0000

Despite the seemingly self-evidentness of the simplistic models economists teach us in university, I think it is something of a miracle that ‘the system’ is often able to find ways to productively employee the vast majority of people who want to work.

Of course, in many place the system is not able to work this miracle. South Africa, Argentina, some might even say France, have high unemployment as a permanent outcome.

I don’t believe economists really know what it takes to create consistent full employment. Sure Obama should create jobs, but there is no one who understands this complex political-economic system well enough to devise effective measures. Maybe it is simply not possible.

Nor am I optimistic that unemployment will fall anytime soon. The system is reeling under huge financial shocks as well as the likelihood of high and volatile oil prices. I don’t see why we should expect the system to be able to work the miracle of finding jobs for most people in the face of so much structural change.

I think Mark provides good advice. Perhaps my main point is that I feel people should prepare for a long hard slog and not expect things to improve to the point that finding employment gets much easier. They need to work with the hand reality has dealt, not wait for a better one.

Let’s hope that my caution is unwarrented and certainly the system might find its way back to better times even in absense of any clever moves by the government. But lets keep in mind that the last 50 years in North America have been strangely blessed and while an economist might be optimistic I’m not so sure a historian would be.