Reuters wrote "It's a mystery that has puzzled even Federal Reserve Chairman Ben Bernanke: if the U.S. economy is growing rapidly, why isn't it creating jobs?"
Before 1960 we had lots of manufacturing jobs. Then we started creating many white collar, mainly high-tech, jobs. We didn't worry that manufacturing jobs started to be outsourced to other countries. Since NAFTA was created in 1994, those white collar jobs started to be outsourced. Today there are few call centers left in the USA. Most software jobs have been outsourced to India and China. Even radiologists have been outsourced to India. The Internet allows companies to shift most workers to other countries; most jobs only require Internet and/or telephone access. H-1B and L-1 visas are responsible for the transfer of hundreds of thousands of mainly high-tech jobs from Americans to Indians. Economist Nouriel Roubini, one of the only people to predict the current panic, has predicted that 25% more jobs will be outsourced in the near future.
When entrepreneurs create a business today, they often fly to China to establish their factory. Illinois Representative Danny K. Davis flew to China to help a friend create a factory there. Davis admitted "It’s not going to create jobs in Illinois."
Walmart is responsible for something like 10% of our Chinese imports. When Walmart comes to town, many small businesses are forced to close because of the competition. It is impossible to compete with a company which 1) manufactures its products in China while paying those workers a pittance, 2) pays its American workers as low a wage as possible, and 3) often receives tax breaks from the city in which the store will be located.
In the past, we would recover from a recession when companies ran out of inventory. They would be forced to manufacture more products which would result in Americans going back to work. Now the economy will grow without creating jobs here because those companies will be hiring people in other countries.
It's the outsourcing, stupid.
Before 1960 we had lots of manufacturing jobs. Then we started creating many white collar, mainly high-tech, jobs. We didn't worry that manufacturing jobs started to be outsourced to other countries. Since NAFTA was created in 1994, those white collar jobs started to be outsourced. Today there are few call centers left in the USA. Most software jobs have been outsourced to India and China. Even radiologists have been outsourced to India. The Internet allows companies to shift most workers to other countries; most jobs only require Internet and/or telephone access. H-1B and L-1 visas are responsible for the transfer of hundreds of thousands of mainly high-tech jobs from Americans to Indians. Economist Nouriel Roubini, one of the only people to predict the current panic, has predicted that 25% more jobs will be outsourced in the near future.
When entrepreneurs create a business today, they often fly to China to establish their factory. Illinois Representative Danny K. Davis flew to China to help a friend create a factory there. Davis admitted "It’s not going to create jobs in Illinois."
Walmart is responsible for something like 10% of our Chinese imports. When Walmart comes to town, many small businesses are forced to close because of the competition. It is impossible to compete with a company which 1) manufactures its products in China while paying those workers a pittance, 2) pays its American workers as low a wage as possible, and 3) often receives tax breaks from the city in which the store will be located.
In the past, we would recover from a recession when companies ran out of inventory. They would be forced to manufacture more products which would result in Americans going back to work. Now the economy will grow without creating jobs here because those companies will be hiring people in other countries.
It's the outsourcing, stupid.
