3 ms·

"It's just the market" is such a lazy reply. Did entrepreneurs not like making money back then? Or did they realize that a healthy society was just as important

by 1_2__4 9y ago

"It's just the market" is such a lazy reply. Did entrepreneurs not like making money back then? Or did they realize that a healthy society was just as important as healthy companies?

eof 9y ago
It was definitely closer to the former than the latter. Things that are obviously profitable now were not hip or obvious, nor was the infrastructure to commoditize everything available.
- cmiles74 9y ago
  I think this idea that it's okay to have most of the employees at a large plant working for smaller outsourcing companies (instead of, say, Apple or Kodak) wasn't acceptable. I wonder if there was some tangible benefit that was derived from having many full time workers that has either evaporated or has been overshadowed since the 70s.
  - ghaff 9y ago
    There are probably some specific factors--like the rise in healthcare benefit costs. But, overall, there's just an increase in specialization throughout the economy. As you go back in time, you just generally had fewer services companies that were available to fill every need that was tangential to the main focus of a given company. To give one example that goes back a little further, companies used to handle the whole payroll process themselves. Now they use ADP or whoever. There's also been a lot of automation/self-service of mundane tasks. You don't really have the stereotypical "starting the mailroom" job any longer nor do you have the steno pool.
Decade 9y ago
There were tax implications. Paying the top executives a gazillion dollars wasn’t attractive because that was also a gazillion dollars given to Uncle Sam. https://news.ycombinator.com/item?id=15161755 https://news.ycombinator.com/item?id=15161755 Another change since then was the rise of the corporate raider. Used to be that you could run a public company without profit as the primary motive. Parable of the Mexican fisherman, and such. (https://bemorewithless.com/the-story-of-the-mexican-fisherman/ https://bemorewithless.com/the-story-of-the-mexican-fisherma...) But now people like Carl Icahn (and Mitt Romney in his private sector days) actually hunt for companies that are not maximizing return to investors, and remake them into companies that do. Apple actually had to fend off Carl Icahn recently. (http://www.marketwatch.com/story/carl-icahns-2-billion-apple-stake-was-a-prime-example-of-investment-inequality-2016-06-07 http://www.marketwatch.com/story/carl-icahns-2-billion-apple...)
anovikov 9y ago
No, it is just that demand for janitors and engineers have shifted. You need fewer janitors now because modern chemicals allow cleaning same space quicker (and probably tools also changed a bit, while maybe in the U.S. in 1980s, modern ones have already been in place). You need more engineers. And they impact work more because development and marketing (which also became a branch of engineering, see: growth hackers) is more important now than production. You can always train enough janitors, not so easy with engineers. Same thing about nearly all low-skilled workers. They are easy to train and their supply is nearly infinite, demand isn't, and demand for high-skilled is high plus they make so much profit you can actually afford paying them a ton of money, which wasn't possible back in 1980s. It is that proverbial bifurcation of workforce. Outsourcing has nothing to do with it. It is just technological change. There is no way out of it (at least no way which won't cripple economic growth - which is already not so good).

by 1_2__4 9y ago

"It's just the market" is such a lazy reply. Did entrepreneurs not like making money back then? Or did they realize that a healthy society was just as important as healthy companies?

eof 9y ago

It was definitely closer to the former than the latter. Things that are obviously profitable now were not hip or obvious, nor was the infrastructure to commoditize everything available.

cmiles74 9y ago
I think this idea that it's okay to have most of the employees at a large plant working for smaller outsourcing companies (instead of, say, Apple or Kodak) wasn't acceptable. I wonder if there was some tangible benefit that was derived from having many full time workers that has either evaporated or has been overshadowed since the 70s.
- ghaff 9y ago
  There are probably some specific factors--like the rise in healthcare benefit costs. But, overall, there's just an increase in specialization throughout the economy. As you go back in time, you just generally had fewer services companies that were available to fill every need that was tangential to the main focus of a given company. To give one example that goes back a little further, companies used to handle the whole payroll process themselves. Now they use ADP or whoever. There's also been a lot of automation/self-service of mundane tasks. You don't really have the stereotypical "starting the mailroom" job any longer nor do you have the steno pool.

Decade 9y ago

There were tax implications. Paying the top executives a gazillion dollars wasn’t attractive because that was also a gazillion dollars given to Uncle Sam. https://news.ycombinator.com/item?id=15161755 https://news.ycombinator.com/item?id=15161755 Another change since then was the rise of the corporate raider. Used to be that you could run a public company without profit as the primary motive. Parable of the Mexican fisherman, and such. (https://bemorewithless.com/the-story-of-the-mexican-fisherman/ https://bemorewithless.com/the-story-of-the-mexican-fisherma...) But now people like Carl Icahn (and Mitt Romney in his private sector days) actually hunt for companies that are not maximizing return to investors, and remake them into companies that do. Apple actually had to fend off Carl Icahn recently. (http://www.marketwatch.com/story/carl-icahns-2-billion-apple-stake-was-a-prime-example-of-investment-inequality-2016-06-07 http://www.marketwatch.com/story/carl-icahns-2-billion-apple...)

anovikov 9y ago

No, it is just that demand for janitors and engineers have shifted. You need fewer janitors now because modern chemicals allow cleaning same space quicker (and probably tools also changed a bit, while maybe in the U.S. in 1980s, modern ones have already been in place). You need more engineers. And they impact work more because development and marketing (which also became a branch of engineering, see: growth hackers) is more important now than production. You can always train enough janitors, not so easy with engineers. Same thing about nearly all low-skilled workers. They are easy to train and their supply is nearly infinite, demand isn't, and demand for high-skilled is high plus they make so much profit you can actually afford paying them a ton of money, which wasn't possible back in 1980s. It is that proverbial bifurcation of workforce. Outsourcing has nothing to do with it. It is just technological change. There is no way out of it (at least no way which won't cripple economic growth - which is already not so good).