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Jobs lost: Fact or Fiction?

Discussion in 'Other Off Topic Forum' started by tifosi69, Feb 26, 2004.

  1. tifosi69

    tifosi69 Formula 3

    Dec 23, 2003
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    Something has been bothering me for awhile about all the Bush bashing in the media in regards to unemployment figures and the so-called "job flight" overseas. Please, fchat members chime in with your opinions to my logical quandry.

    Now, first of all, I can remember being a young boy in the late 70's and early 80's and hearing my mother (God rest her soul) complaining: "Isn't anything MADE in America anymore?" in response to the massive wave of consumer goods that were, 25-30 years ago, already flooding our shores. Seemed like you turned over anything and it read: Made in Taiwan, China, whatever. This is not a NEW phenomenon.

    The great employment GAINS that all the dems still brag about during the Clinton years were fantasy and doomed to failure from the get go. The MILLIONS of over-paid phone bank people, customer service people and programmers took jobs that they were DESTINED to lose from day one since their employers rarely actually manufactured any product, rarely provided any real service, and even more rarely, if at all, ever made a PROFIT. Therefore, the dot.com bubble was doomed to failure, and only the guys like Mark Cuban, who was smart enough to sell to a huge media conglomorate that was stupid and greedy enough to overlook the lack of business sustainability in their zeal to jump on the information superhighway bandwagon, actually made any money. I am not saying that no one, either on this board or in the world made money in the dot.com period, it's a well established fact that many did, but how much and for how long?

    Nevertheless, this brings me to my main point (I hear you all saying FINALLY !!), a philosophical quandry that I would like some lefties to answer: If anyone on this board works for a company, small, medium or large, it doesn't matter, do you feel your JOB SKILLS and talents BELONG to you? In other words: (hypothetical scenario) you and your wife go on vacation to Paris and while there you meet a person at a restaurant, strike up a conversation and you realize you are in the same business field. This person tells you that their company is STARVED for (insert skill position here) and, as CEO, they would love to hire you to work in their Paris headquarters. BTW, they will pay you 3 times what their American counterpart is paying you with all commensurate benefits, etc. You look at your wife and say: "Geez honey, we live alright at home, we could live in Paris (or wherever, I already hear the French haters responding) live like KINGS on the American dollar salary equivalent, and still have double the salary to play with, life would be great" and so you accept the offer, fly back home and give your employer 2 weeks notice. Why can you do this, providing you have not signed an employment agreement in regards to term? Because, just like your body is your own and belongs to you, so to do your talents and job skills, your VALUE to your employer. I am not referring to sharing any intellectual property from your old company or breaching any confidentiality agreements as regarding trade secrets, I am just referring to your RIGHT to work for whomever will have you and pay you the MOST. I would like to here ANYONE on this board, right or left say THEY would not do this! This exact scenario happens every single day throughout the corporate world, in every field, in every position level from janitor all the way up to CEO. That's why there are headhunters.

    So, if your job skills and talents are truly your own, and you have the RIGHT to do with them, and take them to whomever, as you please to best benefit you and your families BOTTOM LINE, then why is everyone complaining about THEIR jobs being taken overseas? IMHO, the jobs BELONG to the company, just as your talents/skills/value inherently BELONG to you, and as such, said company has a fuduciary responsibility to it's investors to do what is best for its own bottom line. Why can Joe Six-Pack in scenario 1 say to employer: hey thanks for the memories but ABC is going to pay me 3x what you pay me, so see ya, but ABC Co. in the face of draconian legislation, governmental-imposed political correctness and union shakedowns, is NOT supposed to find the most beneficial business scenario for themselves. This is even more important given the fact that labor costs are one of the FEW things in many industries that can be actually controlled by a company. Many times costs such as materials and market price cannot, or at least not immediately, be controlled by a company in an effort to increase profitability.

    So, it's time for some intellectual honesty here. How do you explain the difference?
     
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  3. tifosi69

    tifosi69 Formula 3

    Dec 23, 2003
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    And BTW, the employment statistics are a SHAM but no dem candidate is going to admit that. What happens to all the people who got fired and then get unemployment for as long as allowed and then are cut off? Are they all putting guns in their mouths? Are we set to experience a suicide epidemic of epic proportions? I don't think so, for you see, everyone is overlooking, intentionally, the fact that these people, just like all of us, need money, so what do they do? Many of them are venturing out on their own as entrepreneurs, and have been since the early 90's. But Dept of Labor stats DO NOT count these people because if they did you would see an increase, not a decrease in the jobs market. Once that ONE individual goes out on his own he disappears from the job radar screen of the government and ONLY re-appears when he's hired his first REAL employee (ie W2 salaried paying into SS, the great ponzi scheme, unemployment insurance, etc.) 1099 independent contractors DO NOT count, therefore they too are off the radar, and so on and so on until you begin to see that these numbers are BS. It can take months or even years before the TRUE number of people employed and jobs created can ACCURATELY be calculated.

    Food for thought.
     
  4. Uberpower

    Uberpower Formula Junior

    Feb 6, 2004
    902
    hmmm...

    My humble opinion follows: It is a simple Demand Chain equation

    Corporate America has learned a lesson from automotive manufacturing and computer manufacturing. It's called JIT (Just In Time). With JIT, companies only carry inventory when it behooves them to do so (i.e. when there is a unit/widget on order).

    Dell's business model is that they have 2 hours of parts onhand at any given time, but also has a constant stream of supply available from their vendors which are REQUIRED to have an outpost base of operations in Round Rock, TX. These vendors are required to keep the "saftey stock" of required parts for Dell, and they suffer the consequenses of demand fluctuation and obsolesance. Not Dell. Given that the highest historic losses for the computer industry are brought on by obsolesance, they have negated the factor. Not only is this more cost effective, but they also have a valve that they can open, close and control as needed.

    This is how Dell has historically achieved ridiculous profitability. Many automotive factories such as those that belong to Toyota operate in the same fashion (although those are a bit different given that many part suppliers FOR Toyota are actually partially or wholly owned subsidiarys OF Toyota).

    So, to extrapolate this example to the model of the US Workforce...

    Corporate America = Dell
    Unit/Widget = 1 hour of labor
    Parts = Worker/Skilled Laborperson
    Vendors = India, Eastern Europe, China

    A corporation examines their infrastructure or org chart and maps it financially. Those positions that can be "outsourced" (non-customer facing positions such as system administration, call centers, research and development, etc.) can be outsourced to a "vendor" in a country that has an all inclusive labor rate that is 25-50% less than the corporation currently spends in those areas of the organization. Given that this labor is likely provided by a "staff augmentation" company in the respective country of choice, the corporation will sign a contract for a certain number of hours (units) to be completed with the new labor persons (parts).

    After fufilling thier contractual amount, they can adjust the contract as necessary based upon the efficiency realized in the first contract (aka the control valve).

    This is no different than the outsourcing of the american manufacturing job to robots and foreign workers in the 70's and 80's. You are just seeing a different demographic being hit (Think $60-100K jobs instead of $20-40K jobs).

    Yes, there are American jobs being lost. What you have just read is the model that is fueling the loss.

    Now to answer your ethical question: Is it the corporations right to select any avenue to achieve profitability?

    The answer is yes.

    Is it very nice and socially responsible?

    The answer is no.

    Regards,

    Nick
     
  5. bkaird1

    bkaird1 Karting

    Nov 7, 2003
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    Brad
    Yea, the BLS actually uses 2 different surveys... the establishment (payroll) survey and the household survey. The ES relies on a pool of about 400,000 to determine the number of people employed. The prob is that this does not count new businesses or self-employed people. On the other hand... the household survey is a random survey of 60,000 homes. This would pick those up. If I remember right, the household survey actually shows almost 2 million new jobs created in the last year.

    http://www.bls.gov/opub/hom/homch2_g.htm
     
  6. Bill Sawyer

    Bill Sawyer Formula 3

    Feb 26, 2002
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    Georgia
    It's not just blue collar jobs. The biggest change in the past ten years has been downsizing. White collar jobs are shrinking, and there is little opportunity for anyone over the age of 45 to find employment. If you are over 50 you are virtually unemployable. Unfortunately, your bills don't go away and your children still need to be fed, clothed and educated. Find a lower paying job? Wait, they won't hire you because you are overqualified!
     
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  8. PeterS

    PeterS Three Time F1 World Champ
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    1) It's not the governments position to make sure anyone has a job
    2) We all want our $.99 Big Macs
     
  9. tifosi69

    tifosi69 Formula 3

    Dec 23, 2003
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    But what about the flat-out contradiction: an individual thinks, and rightly so, that it's their God-given right, to take his toys and go play elsewhere and NO ONE feels their is moral dilemma BUT a company that does the SAME THING is "the bloated, greedy right-wing, BIG-BUSINESS boogie man"

    WTF?
     
  10. Ashman

    Ashman Two Time F1 World Champ
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    Support for this view from the Chief Economist at Bear Stearns:

    NOT A JOBLESS RECOVERY
    BY David Malpass
    Chief Global Economist-Bear Stearns.



    Data is showing strong, sustainable growth for the U.S. in 2004, which has continued positive implications for U.S. profits and equities. In both nominal and real terms, U.S. gross domestic product has hit a new record in each quarter of 2002 and 2003, reaching over $11 trillion in current dollars. And in the fourth quarter of 2003, the economy grew fast — probably well over 5 percent — defying the bearish expectations about the temporary nature of the U.S. expansion.

    But the detractors still ask, What about the jobs?

    Well, there are two job surveys produced by the Department of Labor — the household survey and the establishment (or payroll) survey. Each has a different story to tell.

    The government's survey of household employment showed an all-time record 136.2 million non-agricultural workers in December, which is up over 1.5 million in 2003. More, unemployment claims fell to a 347,500 four-week average through January 10 — a level consistent with fast job growth. This is the same picture shown by the rapid decline in the unemployment rate to 5.7 percent.

    But the missing part of today's strong economic picture is a rise in the establishment survey of employment. According to this survey, the number of jobs in U.S. non-farm establishments fell 74,000 in 2003.

    There are several explanations for this weakness.

    Employment in established businesses rose to a very high level in the late 1990s, in part at the expense of self-employment. Some part of the current weakness in establishment jobs — and the strength in the household survey — is a reversion to normal after the boom of the late 1990s.

    The establishment survey is also routinely revised upward at turning points in the economy. Looking back to the 1992-93 period of weak growth in the establishment survey, payrolls were upwardly revised by 1.88 million jobs in the ensuing years, validating the household-survey view of the labor market.

    Establishment employment is also related to changes in inventory. Inventories fell even in last year's third quarter — when GDP rose 8.2 percent — and November data showed inventory-to-sales ratios still at record lows. Establishments have been particularly risk-averse on hiring due to deflation and 9/11.

    Skewed seasonal factors (notably for retail employment) may also be playing a role. The establishment survey underperformed the consensus for December 2002 (released in January 2003) by 121,000, but outperformed the consensus by 75,000 for January 2003 (released in February 2003).

    With the above points in mind, it's reasonable to say that employment in the establishment survey will grow strongly in 2004 as inventories rebuild, risk-aversion at big companies finally abates, and the bulge in establishment jobs finishes reverting to normal.

    Think record jobs and GDP, not a jobless recovery.

    <end quote>

    John
     
  11. Evolved

    Evolved F1 Veteran

    Nov 5, 2003
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    If we don't produce widgets(1946-1980) and we don't produce high value added intellectual capital(1980-now), then what do we produce?

    I don't see how America can be a nation of Lawyers and management consultants.

    Job losses are a fact. I see it more then ever.
     
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  13. tifosi69

    tifosi69 Formula 3

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    This is exactly my point John, these are FACTS, not political mantra bantied about to stir up the great unwashed who typically vote Democrat and have the "where's mine" mentality. In other words, the Kerry, Edwards, Dean, et al. suporters. This is the SHOCKING TRUTH the dems don't want voters to know, but this is all very interesting yet, unfortunately academic, because the average voter spends more time playing xbox than they do reading a newspaper.
     
  14. tifosi69

    tifosi69 Formula 3

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    Correct!
     
  15. tifosi69

    tifosi69 Formula 3

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    In the traditional sense ... yes, but there are far more entrepreneurs and self-employed now than ever before in our nation's history. Do they just not count? Do you just want to discard these factual numbers because they do not work 9-5 and have the nipple of an official "job" to suck on. The hype about woking for a big corp is many times overrated. Self-employed people are making money and taking that money and buying consumables, buying hard assets like homes, TVs, cars, etc. This nation has become the world's greatest and strongest and most powerful nation in the world, despite barely being 200 years old, BECAUSE OF, not in spite of, the individual's entrepreneurial ethic.
     
  16. Evolved

    Evolved F1 Veteran

    Nov 5, 2003
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    We were a nation of entrepenuers and small business owners once and I think we can be again. However, it's going to be a very painful transition.

    People who own businesses are also more apt now to not hire someone then ever before. It SO HARD to have w-2 employees I know dozens of people who have just decded to stay small and not grow.
     
  17. tifosi69

    tifosi69 Formula 3

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    What makes you think we still aren't?
     
  18. MarkG

    MarkG Formula Junior

    Nov 3, 2003
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    American jobs are being lost to India, South America and Red China at an alarming rate.

    There arn't the DOT.COM jobs mentioned in a previous post, those did not go over-seas, they just went. As well they should have, being in the high-tech industry, working at the time for the company that designed Alta Vista, I was never able to understand how anyone could believe that a company that produces nothing (i.e. search engines, etc.) could have $140 stock. Anything that sounds too good to be true usually is.

    Someone mentioned 'phone bank' jobs destined to go away anyway. If this was true you would never reach a live person: not at your credit card co., not at the phone company, not at the cable company, not at computer support or any other customer service site. For instance when you call our 'phone bank' the person answering needs to determine if your problem is hardware or software; if its mainframe or Intel based; Windows, VMS or Unix issue, if remote dial in diag is needed, if network issue is it TCP/IP, router, server etc., if its a cluster issue, BUGCHK or MCHCHK issue and so on; the ability of our engineers to qiuckly solve issues is directly related to the quality of problem statement taken by the 'phone bank'. We had about 100 people who had 1-2 months training doing this job; as of Marcvh 30th we will have about 16. All the rest went over-seas to people who received 1 week training.

    Estimate of 3-5 million jobs going over-seas in next 2 years; they include: anyone who answers a phone for a living; tax preperation; architecure; medical transcripture; law (wills, trusts and contracts); x-ray technitions and the list goes on.

    Politicians tell us new jobs are being created; what they CAN'T tell us is where, how much they pay and what bennefits they have - I have seen many interviews with economists who tell us sending millions of Americans to un-employment is good for America. Not one, when asked, can actually tell us just how this bennefits America, and none so far have been able to tell just where these 'new jobs' are being created.

    Here's who bennefits from outsourcing: CEO bonuses; Board of Directors and and very small handfull of stock holders. America does NOT bennefit.

    Colorado Springs has been hit very hard by 'outsourcing', up to 17k jobs by one account. Foreclosures are soo high that realators are telling sellers that they may be on the market for months, since the few buyers out there are grabbing bank owned houses. Lenders are requiring up to 40% down payment. Our un-employment rolls are shrinking, not because of new jobs but bennefits just run out.
     
  19. davem

    davem F1 Veteran
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    Seems like most new jobs being created are in service which are typically lower paying. Outsourcing overseas is scary. All i know is if someones job is outsourced overseas it is lost. That is a cold hard fact. Now about this person finding a new job in some yet to be created field is just conjecture.
    Also when is this person suppossed to be able to school themselves in this new field. When they are employed and have no time nor idea whats around the corner. Do they wait til they are unemployed and have no money coming in!?
     
  20. Schatten

    Schatten F1 World Champ
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    Dell Fun Fact of the day:
    Actually, in addition to having something very close by, companies such as Maxtor, who have a pallete of harddrives ready to go in the factory take up space on the floor. That space on the floor is leased out to Maxtor. Once a harddrive is removed from the pallete, then it belongs to Dell. Up until that time, still... Maxtor still owns that harddrive and is paying for the space it takes up in the factory until it is ready to go into a customer's system.
     
  21. Uberpower

    Uberpower Formula Junior

    Feb 6, 2004
    902

    Well that is a very black and white picture that you have painted Tifosi! Of course gray is the color that shades the world.

    A corporation can replace a worker easily. It is far more difficult for a worker to replace a corporation, given that other corporations will follow the trend that corporation 1 sets when stock price (set by competition with corporation 1) forces them to do so.

    The result: Entire job-categories within the US are rendered obsolete.

    Tell me now that your contradiction is a true contradiction.

    Nick
     
  22. Uberpower

    Uberpower Formula Junior

    Feb 6, 2004
    902

    Ha! That is cutthroat business!

    It doesn't surprise me one bit! Perhaps charging for the building's oxygen is next? Go Michael! Go, go go!
     
  23. ART360

    ART360 Guest

    You can play with the numbers in any manner you wish, but it clearly shows that we have lost quite a few jobs. Is it the government's responsibility to make sure that we all have work, of course not. However, it is the government's job to ensure that we have a peaceful society. Give us large unemployment, and we will have civil unrest. People don't like not having work and money.

    We are losing jobs because of the computer and the related technology. It started with the computer driven machine tools. It used to be that it took a very educated person to run a lathe, mill or other machine tool. You had to know Turning speeds, etc. Now, most of that is programed into the machine. One machinist can supervise uneducated machine watchers, who make a lot less than an educated machinest can run a whole bunch of machines. That means that we will be exporting jobs as long as the computers get better and better. There's now a program to diagnose (sp) which has proven, in limited circumstances, better than a live doctor. This doesn't bode well for society, we'll end up with an investor class, and fewer and fewer workers.

    As society we need to think our way through this, or we'll end up in society where we won't be very happy, i.e., no middle class, and a small upper class with a large underclass. Sounds a lot like South America, and life isn't very pleasant there, with the very high level of crime, social disruptions, etc. Those are my thoughts on this issue.

    Art
     
  24. tifosi69

    tifosi69 Formula 3

    Dec 23, 2003
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    You are right and my answer is ... SO WHAT? With every category rendered obsolete another 10 emerge. How many people pay to repair electronics like Tvs any longer? None. Why because the electronics are so cheap that they are now disposable. But because of the cheapness of the electronics, massive competitors emerge like Hi FI Buys, Circuit City, etc. as an alternative to buying these items at the over-priced chain department stores like Sears, where everybody used to HAVE to go to buy said items. These discount retailers employ people, who in turn get paid, who in turn spend their money at other retailers etc. Are some of these categories that emerge as high-paying in terms of gross dollars as the categories they replaced? No they are not, but that is progress my friend. This country has constantly experienced since 1776 this exact trend you describe and we are none the worse for wear... in fact we are the greatest, most powerful and wealthiest nation on earth. This trend is part of development, innovation, growth and PROSPERITY. Do you see any horse and buggy manfacturers around any longer? No, and when the automobile came around it replaced the 2 or 3 job categories it extinguished with another 100+ Do you see any manufacturers of telegraph machines any longer? No, but the emergence of the telecom industry and its subsequent growth created 1000's of categories for the ONE it displaced.

    Argument does not wash.
     
  25. Uberpower

    Uberpower Formula Junior

    Feb 6, 2004
    902

    It is very obvious that we are at the bottom of a cyclical pattern experienced since the beginning of time; however, it seems you have strayed from your initial comparison/contradiction.

    Both parties in an "at will" employment relationship are quite free to do what they wish with regard to ending the relationship. Therefore layoffs ARE ethical and necessary. When I said "is it nice or socially responsible - No." I meant that there are ways of retraining and redeploying people, that most corporations do not take advantage of.

    The result of this factor is that given a time period, barring exceptional circumstance, the ex-employee will run out of savings. Along with the multitude of other ex-employees that worked in the same capacity that were also made redundant. This will place burden upon government and economy, along with the companies that initially rendered the categories of employment obsolete.

    Sit back- take all of that in. Breathe deeply. NOW tell me that your contradiction is a true contradiction.

    You are comparing micro and macro. Impossible comparison.

    Respectfully,

    Nick
     
  26. tifosi69

    tifosi69 Formula 3

    Dec 23, 2003
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    Ah... the truth is emerging... class envy. CEOs are making all the money, the sky is falling, those rich bastards!! As I said in the post, unemployment rolls are shrinking because of benefit expiration..true. What are those people doing? Are they all committing suicide? Is there a rash of hold-ups at ATMs in your area where unshaven, unwashed formerly employed people in Brooks Brothers suits are now, as a last resort following the Robin Hood syndrome? The answer is NO.. they need money like the rest of us and they are starting small businesses, or working for people who started small businesses, sometimes "off the books" and so they are not counted. I have a friend who sits at home, enjoys spending a great deal of time with his wife and kids, and runs an Ebay business that nets him 15-20k per month. Has he been hurt when his former HUGE employer forced him to take early retirement. NO! He also owns 2 Ferraris as a result of the Ebay business. Where's the problem?
     
  27. Evolved

    Evolved F1 Veteran

    Nov 5, 2003
    8,206
    Pittsburgh, PA
    Look to your left, look to your right.

    How many of the people you see think they have more then trivial stake in the success of the place they go to to work every day?
     
  28. tifosi69

    tifosi69 Formula 3

    Dec 23, 2003
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    A great many, what is your definition of "company?" Is a one man show running a business on Ebay from his basement a "company" in the traditional sense? Probably not, however, if he's making 6 figures with his business he has to spend that money some where right? Those dollars are spent by him and his family on all kinds of things that then help and employ others and so on and so on.
     

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