jobless Recovery, many IT pros out of work

Discussion in 'A+ Certification' started by Joe, Jan 13, 2004.

  1. Joe

    Joe Guest

    with all these IT pros out of work,it makes sence to stick with
    repairs,serving practial marketplace needs


    Monday, January 12, 2004
    False Recovery -- Economic Commentary by Stephen Roach Morgan Stanley
    Global Economic Forum ^The Great American Job Machine has long powered
    the US business cycle. It drives the income growth that fuels personal
    consumption. That internally generated fuel is all but absent in the
    current upturn. The US economy is mired in a jobless recovery the
    likes of which it has never seen. This has profound implications for
    the economic outlook, the political climate, trade policies, and the
    global business cycle.

    Contrary to popular spin, the US labor market is not on the mend. In
    the final five months of 2003, a total of only 278,000 new jobs were
    added by nonfarm businesses — a gain that is easily matched in a
    single month of a typical hiring-led recovery. Moreover, literally all
    of the job growth that has occurred over this period has been
    concentrated in three industry segments — temporary staffing,
    education, and healthcare — which collectively added 286,000 positions
    in the final five months of last year. The "animal spirits" of a
    broad-based hiring-led revival by US businesses are all but absent.
    Jobs may be rising in America's low-cost contingent workforce (temps)
    and in high-cost-areas that are shielded from international
    competition (health and education), but positions continue to be
    eliminated in manufacturing, retail trade, and financial and
    information services.

    The modern-day US economy has never been through anything like this.
    Fully 25 months into this so-called economic recovery, private-sector
    jobs are still about 1% below levels prevailing at the official trough
    of the last recession in November 2001; at this juncture in the
    typical recovery, jobs are normally up about 6%. Had Corporate America
    held to the hiring trajectory of the typical cycle, fully 7.7 million
    more American workers would be employed today. Moreover, the current
    hiring shortfall far outstrips that which was evident in America's
    only other jobless recovery — the upturn following the recession of
    1990–91. In that instance, it took about 12 months for the job machine
    to kick back into gear. By our calculations, the current job profile
    in the private economy is now 2.4 million workers below the trajectory
    of the jobless recovery a decade ago.


    The "imported productivity" provided by offshoring has become
    especially evident in IT-enabled services — where the knowledge-based
    output of a remote low-wage white-collar workforce now has real-time,
    e-based connectivity to production platforms in the developed world.
    One of the clearest examples of this is a significant shortfall of job
    creation in America's IT and information services industry. In the
    upturn of the early 1990s, employment in this industry had increased
    nearly 4% by the 25th month of that recovery; by contrast, in the
    current cycle, such jobs are down over 1% — even though the US economy
    is far more IT-intensive today than it was back then. At the same
    time, knowledge professionals' headcount in India's IT sector has
    risen from 50,000 in 1990–91 to an estimated 625,000 workers in
    2002–03.

    I don't think these trends are a coincidence. More likely than not,
    they are the flip sides of the same coin — a shift of
    comparable-quality labor input from the high-wage US services sector
    to the low-wage Indian services sector. And, of course, this trend is
    only the tip of a much bigger iceberg, as offshoring now spreads up
    the value chain to include professions such as engineering, design,
    and accounting, as well as lawyers, actuaries, doctors, and financial
    analysts. Long dubbed the "nontradables" sector, the IT-enabled
    globalization of services is now in the process of transforming this
    vast sector into yet another tradable segment of the US economy —
    posing a formidable challenge to the once unstoppable Great American
    Job Machine.
     
    Joe, Jan 13, 2004
    #1
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  2. Joe

    MF Guest

    I saw a panel discussion on CNN (computers + CNN = no life at all, boy
    I;m lucky i flukd algbra, i thout its was allana'sbra which i
    succeeded in the first time, but fluked the second)

    NY state senator Schumer was the celeb on view, there was an
    incredibly good looking leggy blonde economist from the Brookings
    institute, with an amazingly beautiful name, the CEO of the American
    Chamber of Commerce(business uber alles) and some old guy with an eye
    twitch, Schumer's pal, also from Brookings institute.

    the guy with the eye twitch pointed out that all the folks who
    promoted free global trade based their ideas on the concept of
    comparative advantage, an early concept in capitalist economic theory.
    e.g.., Portugal is good with wine. England is good with textiles.
    Portugal gets the wine business globally, England gets the textile
    trade. the comparative advantages enable each country to make the
    most of their skills.

    that, said the man with the twitch, is dead. ESPECIALLY AND MOST
    PARTICULARLY with the high tech industry. if, for example, we have
    remote admin solutions for Windows server 03 and, for that matter,
    Novell's new Linux servers.

    A person who can use that software to manage a server in the US costs
    from 45-65 K a year, depending on location. A person in India or
    china who can do it costs from 10-15 K a year with a 7 to 10 K rakeoff
    from the Outsource company. Assuming that this remote management
    software is learnable by people with IQs above, say 105 or 110 or even
    120, we cannot compete. There is no comparative advantage. This
    business is so big that the country it goes to scores a win and the
    country that loses it scores an irredeemable loss.

    There is no amount of education that can guard us from this loss.
    When we say, more science, math, computers, blah blah blah, in our edu
    system, we are saying "let's crank out more 60 K a year workers to
    compete with these 15 K a year workers. "

    According to the perspectives and values of American business, there
    is no competition here.

    He's right about that. He also pointed out that business (and Bushie)
    are now advocating more or less unlimited immigration to supply low
    wage workers to various businesses and, of course, to those who need
    nannies. (remember nannie-gate?) And he pointed out that this is a
    complete no-win situation, with millions of people entering the
    country to sacrifice (hard work, bad neighborhoods, better life for
    the kids) for expanded horizons while those horizons are in the
    process of being shut down. So his scenario for the immediate future
    is increased pressure from below (including those Americans the
    immigrants push out of jobs due to low wage demands) while the
    stairways up are slowly collapsing.

    A potentially explosive situation, as we have seen over and over again
    in our present day third-world neighborhoods.

    He also predicted the US would be a 2nd or 3rd world country in twenty
    years. I think he's wrong about that. I think it will take about 40
    years.

    I'm too old to run a pool on that, but well, who knows? How good does
    the education of, say, an electrical engineer have to be to justify a
    pay premium of 30 to 50,000 dollars, asked our friend with the twitchy
    eye. Well, how good? And how much better does the educations of
    network admins have to be after we have higher bandwidth, better
    Tivoli, better Openview, better SMS?

    You know what was really striking about the panel discussion? The guy
    who ran the Chamber of Commerce had very few objections to the
    analyses presented by the, shall we say, more downwardly mobile
    focused of the panelists. All he kept saying was, "that is a problem
    that we have been discussing."

    I also read the quotes from Carly Sim- I mean, Fiorina about said
    problems. She really should be working at Revlon.

    Mike
     
    MF, Jan 13, 2004
    #2
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  3. Joe

    Rrrvvv Guest

    Wow you read shakesspeare! I have never read that and I watch Jerry
    Springer regularly too. ¬_¬
     
    Rrrvvv, Jan 29, 2004
    #3
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