Why Skills Is A Sideshow

    Over the past few years, here and in other places, I've repeatedly argued that we are being fooled and mislead. Okay, that's true in many arenas but today I'm referring to the mantra that we've heard from Republicans and Democrats alike that the solution to competing in the "global economy" is for people to get smarter. American workers are just too dumb, so say conservatives and liberals, and if they just upgraded their skills, presto, they'd become more employable.

    Last year, Oded Shenkar published his book "The Chinese Century" (spotlighted here to the left in the blog's list of recommended books). One of his basic points: pretty soon, China will begin to dominate in the industries where highly skilled work takes places like aircraft production and technology. China won't just be the assembly location for clothes and low-end production anymore.

    Why? WAGES, WAGES, WAGES. It is the main factor driving global production.

    Today, The New York Times has a piece on the front-page of the business section entitled: "Outsourcing Is Climbing Skills Ladder." Here are the first three paragraphs:

The globalization of work tends to start from the bottom up. The first jobs to be moved abroad are typically simple assembly tasks, followed by manufacturing, and later, skilled work like computer programming. At the end of this progression is the work done by scientists and engineers in research and development laboratories.

A new study that will be presented today to the National Academies, the nation's leading advisory groups on science and technology, suggests that more and more research work at corporations will be sent to fast-growing economies with strong education systems, like China and India.

In a survey of more than 200 multinational corporations on their research center decisions, 38 percent said they planned to "change substantially" the worldwide distribution of their research and development work over the next three years — with the booming markets of China and India, and their world-class scientists, attracting the greatest increase in projects.

    The study also contends that lower labor costs are not the major reason for hiring researchers overseas. I don't buy that as a general proposition for the labor force in general. There is nothing wrong with people knowing more math and science. But, it is completely phony to tell people that the solution to future jobs for the board workforce is to get smarter.

     Researcher jobs, or any number of jobs that would be considered "high skill," are a small number in relative terms. Moreover, what is called "high skill" today is fairly slippery--does it mean anyone who touches a computer, which, in today's world, can include pretty basic, routine tasks.

    So, let the president talk about investing money in math and science education and let Democrats and liberals like Robert Reich wax eloquently about knowledge workers (do you ever wonder why it is that the people who promote these theories actually never lost a job to downward driven wages?). Until we can change the nature of competition so that it is not primarily based on the search for the lowest wages, people may get new skills and nice diplomas to hang on their walls but that won't pay the grocery bills.

 

Comments

[D Flinchum]

"Do you ever wonder why it is that the people who promote these theories actually never lost a job to downward driven wages?"

Do you also wonder why wages for the vast majority of workers are stagnating or declining except for CEO's and the 5% making up the upper ranks, whose "compensation packages" are soaring, but the CEO and upper management type jobs are never the ones outsourced or replaced by cheaper imported labor?

[alex]

a few days ago i was speaking with a friend who's in community development in chicago. he told me of an affordable housing architect who has started outsourcing his CAD work to india purely as a means of labor arbitrage. that means what was considered a fairly highly skilled job paying about $50-$75 per hour is now costing this fella about that much per day.

[giuseppe]

I'm not going to say that this is the greatest solution to it all, but it is comforting that Maine is increasingly putting forth legislation to counter the globalization trend. Specifically, there is more and more possibility that the state won't contract with any business that uses sweatshops. In my mind, that's a much better solution to China-bashing (which I realize is not what you are doing).

If a state sees its factories or other industries move out, the state and local government can refuse to contract with them. It isn't as far as I would go, but this too little too late endeavor is perhaps better than nothing.

[donald]

why not china bash a little? i mean the government is pretty bad by any progressive standard, ever. i think progressives get a little too squeamish about being upfront- china's labor policies are horrible, and we shouldn't do business with them. i know we don't like to think in terms of nation-states, but they exist.

i just say this because at this point, barring something pretty radical happening, we're screwed. only an incredibly aggressive stance on fair trade will help, and i mean AGGRESSIVE. do the unions have the strength to muster on that right now? or actually the will? i mean these aren't hard arguments to make, we just make them to the wrong people in the wrong ways. it doesn't matter what the CEOs and busienss press think, they'd sell our skins to buy a yacht and we know that. it also doesn't really matter what progressive politicians think, though it might if there were more than a handful of them.

here's a question, and maybe ya'll are high enough mucky-mucks to do something with it. how do we build real momentum on ideas like fair trade and build political organization around them, in the short-term? like by the next presidential election cycle? as an issue it's there for the taking for whoever bothers to put people on the ground to push for it. isn't it?