8 ms·

I thought those jobs were never coming back!

JoeAltmaier 4y ago
All depends on the size of the factory. Too small - can't swallow the large pill which is automation (hiring engineers, consultants, very expensive equipment). But as soon as your payroll hits a certain figure, automation becomes cheaper and bang! small town everybody laid off. And it isn't all that big a number really.
- peteradio 4y ago
  I don't know if I believe this POV, from what I've seen automation is an enabler to branch into broader product base.
  - tuatoru 4y ago
    I agree. Back in 2013 Frey and Osborne published a paper saying that 47% of US workers were threatened with unemployment from automation. Here we are nine years later, and the prime working age employment-to-population ratio is higher than it was then[1], and unemployment is under half the 2013 rate.[2] If automation is happening, it's probably increasing employment. 1. https://fred.stlouisfed.org/series/LNS12300060 https://fred.stlouisfed.org/series/LNS12300060 2. https://fred.stlouisfed.org/series/UNRATE https://fred.stlouisfed.org/series/UNRATE
    - JoeAltmaier 4y ago
      Sure if 'employment' is slinging burgers. The fact is in America at least, folks have been sliding down the occupation ladder for a generation. Somebody who used to manage a shift at a factory is now selling shoes or a security guard. An office manager becomes a McDonald's manager. And so on and so on. So sure, be comforted by employment statistic, but remember that the govt has been obsessing over them for half a century, and they don't reflect wealth or happiness. Witness the fraction of us that can't afford a house.
      - tuatoru 4y ago
        Good points. Looking at one statistic in isolation is not going to give me a good picture. Thanks for the reminder.
  - astrange 4y ago
    Yes, automation causing unemployment is a myth that seems to be related to the "AI is going to eat us" Singularity people. Automation does the opposite, it creates employment. https://noahpinion.substack.com/p/american-workers-need-lots-and-lots https://noahpinion.substack.com/p/american-workers-need-lots...
    - JoeAltmaier 4y ago
      Nah. 'Creating jobs' means "this factory doesn't need you or have a career for you, so go work someplace menial instead to put food on the table" Its just a plain fact that manufacturing has a tiny fraction of the people employed that it did a generation or two ago. Blurring that with hopeful 'employment' statistics that ignore what kind of employment, is PollyAnna stuff.
      - astrange 4y ago
        You didn't read the article I linked, unless you think nobody in South Korea works in manufacturing.
        peteradio 4y ago
        I think he's implying that those jobs aren't for the "regular joe". I again don't agree with him based on my own experience.
- nyokodo 4y ago
  > bang! small town everybody laid off. The labor shortage is changing this calculus very rapidly. I’m not saying it can’t still happen but it’s much more likely that the factory is lacking people to fill in the wide gaps in the automation possible.
  - nine_zeros 4y ago
    This is probably the reason. There was a spike in retirements during covid. But more importantly, the number of retirees by year is above average too: https://www.stlouisfed.org/on-the-economy/2022/january/great-retirement-who-are-retirees https://www.stlouisfed.org/on-the-economy/2022/january/great...
    - nyokodo 4y ago
      The bulk of the baby boomers have just hit retirement age, we have a much smaller GenX to inadequately replace them on the experienced end, a career-stunted Millennial generation filing in the middle, and an even smaller than GenX Zoomer generation joining the lower ranks. It’s a mess, but if the Millennials catch up and have enough kids then we’ll have a light at the end of the tunnel in 20 years.
      - nine_zeros 4y ago
        > if the Millennials catch up and have enough kids This is a big "if" and as a millenial, I don't see any signs of people wanting to have more than 1 kid. They have struggled throughout our life and don't want to sacrifice more.
    - formerkrogemp 4y ago
      Let's not downplay the deaths due to covid and lack of immigration playing a role. It's almost never just the one thing.
kmeisthax 4y ago
Atlas - or, in this case, Xi Jinping - shrugged[0]. Chinese manufacturing went through three phases: - We can save money by moving our jobs overseas. Sure, it'll blow up our lead times and we'd have to ship goods across the Pacific thrice, but China has 3x the population of the US and the Yuan depreciation makes paying them very cheap. - We can't move our jobs back to the US! We're all tooled up in China, and everyone else followed us there. If we moved back to the US it'd blow up our lead times and we'd have to ship goods across the Pacific thrice. Plus, we literally can't hire enough people in the US, because China is buying our product just as much as they make it now. - We are moving production back to the US because our Chinese factory has been shut down for three months due to COVID and it ate through our buffer for shipping delays at the ports. Again. Yes, we will be paying far more for fewer workers, but getting goods across the Pacific is getting more and more expensive anyway and we're losing on money from not having goods to sell every other week. We are at the third step. [0] Yes I am aware of the irony of using the title of a right-libertarian political diatribe to describe the actions of a left-authoritarian dictator.
- ozborn 4y ago
  3rd step also includes political instability in China, an even riskier business environment, demographic headwinds along with rising wages and increased fixed automation costs everywhere. Globalization, once "inevitable", has been dead since 2019 and isn't coming back in the foreseeable future.
  - nirimda 4y ago
    What happened in 2019 that caused globalisation to die? I remember the first volleys against it being the onset of the pandemic and border tightenings in Feb/Mar 2020. In 2019, COVID-19 still seemed like it might be a local phenomenon and most people outside of China had barely any idea that it existed.
    - kmeisthax 4y ago
      2018 and 2019 saw increasing levels of tariffs apply to Chinese goods, all to force China into signing an FTA deal that never really got off the ground (and, IMHO, would never be fully adhered to by the Chinese side).

All depends on the size of the factory. Too small - can't swallow the large pill which is automation (hiring engineers, consultants, very expensive equipment). But as soon as your payroll hits a certain figure, automation becomes cheaper and bang! small town everybody laid off. And it isn't all that big a number really.

peteradio 4y ago
I don't know if I believe this POV, from what I've seen automation is an enabler to branch into broader product base.
- tuatoru 4y ago
  I agree. Back in 2013 Frey and Osborne published a paper saying that 47% of US workers were threatened with unemployment from automation. Here we are nine years later, and the prime working age employment-to-population ratio is higher than it was then[1], and unemployment is under half the 2013 rate.[2] If automation is happening, it's probably increasing employment. 1. https://fred.stlouisfed.org/series/LNS12300060 https://fred.stlouisfed.org/series/LNS12300060 2. https://fred.stlouisfed.org/series/UNRATE https://fred.stlouisfed.org/series/UNRATE
  - JoeAltmaier 4y ago
    Sure if 'employment' is slinging burgers. The fact is in America at least, folks have been sliding down the occupation ladder for a generation. Somebody who used to manage a shift at a factory is now selling shoes or a security guard. An office manager becomes a McDonald's manager. And so on and so on. So sure, be comforted by employment statistic, but remember that the govt has been obsessing over them for half a century, and they don't reflect wealth or happiness. Witness the fraction of us that can't afford a house.
    - tuatoru 4y ago
      Good points. Looking at one statistic in isolation is not going to give me a good picture. Thanks for the reminder.
- astrange 4y ago
  Yes, automation causing unemployment is a myth that seems to be related to the "AI is going to eat us" Singularity people. Automation does the opposite, it creates employment. https://noahpinion.substack.com/p/american-workers-need-lots-and-lots https://noahpinion.substack.com/p/american-workers-need-lots...
  - JoeAltmaier 4y ago
    Nah. 'Creating jobs' means "this factory doesn't need you or have a career for you, so go work someplace menial instead to put food on the table" Its just a plain fact that manufacturing has a tiny fraction of the people employed that it did a generation or two ago. Blurring that with hopeful 'employment' statistics that ignore what kind of employment, is PollyAnna stuff.
    - astrange 4y ago
      You didn't read the article I linked, unless you think nobody in South Korea works in manufacturing.
      - peteradio 4y ago
        I think he's implying that those jobs aren't for the "regular joe". I again don't agree with him based on my own experience.
nyokodo 4y ago
> bang! small town everybody laid off. The labor shortage is changing this calculus very rapidly. I’m not saying it can’t still happen but it’s much more likely that the factory is lacking people to fill in the wide gaps in the automation possible.
- nine_zeros 4y ago
  This is probably the reason. There was a spike in retirements during covid. But more importantly, the number of retirees by year is above average too: https://www.stlouisfed.org/on-the-economy/2022/january/great-retirement-who-are-retirees https://www.stlouisfed.org/on-the-economy/2022/january/great...
  - nyokodo 4y ago
    The bulk of the baby boomers have just hit retirement age, we have a much smaller GenX to inadequately replace them on the experienced end, a career-stunted Millennial generation filing in the middle, and an even smaller than GenX Zoomer generation joining the lower ranks. It’s a mess, but if the Millennials catch up and have enough kids then we’ll have a light at the end of the tunnel in 20 years.
    - nine_zeros 4y ago
      > if the Millennials catch up and have enough kids This is a big "if" and as a millenial, I don't see any signs of people wanting to have more than 1 kid. They have struggled throughout our life and don't want to sacrifice more.
  - formerkrogemp 4y ago
    Let's not downplay the deaths due to covid and lack of immigration playing a role. It's almost never just the one thing.

kmeisthax 4y ago

Atlas - or, in this case, Xi Jinping - shrugged[0]. Chinese manufacturing went through three phases: - We can save money by moving our jobs overseas. Sure, it'll blow up our lead times and we'd have to ship goods across the Pacific thrice, but China has 3x the population of the US and the Yuan depreciation makes paying them very cheap. - We can't move our jobs back to the US! We're all tooled up in China, and everyone else followed us there. If we moved back to the US it'd blow up our lead times and we'd have to ship goods across the Pacific thrice. Plus, we literally can't hire enough people in the US, because China is buying our product just as much as they make it now. - We are moving production back to the US because our Chinese factory has been shut down for three months due to COVID and it ate through our buffer for shipping delays at the ports. Again. Yes, we will be paying far more for fewer workers, but getting goods across the Pacific is getting more and more expensive anyway and we're losing on money from not having goods to sell every other week. We are at the third step. [0] Yes I am aware of the irony of using the title of a right-libertarian political diatribe to describe the actions of a left-authoritarian dictator.

ozborn 4y ago
3rd step also includes political instability in China, an even riskier business environment, demographic headwinds along with rising wages and increased fixed automation costs everywhere. Globalization, once "inevitable", has been dead since 2019 and isn't coming back in the foreseeable future.
- nirimda 4y ago
  What happened in 2019 that caused globalisation to die? I remember the first volleys against it being the onset of the pandemic and border tightenings in Feb/Mar 2020. In 2019, COVID-19 still seemed like it might be a local phenomenon and most people outside of China had barely any idea that it existed.
  - kmeisthax 4y ago
    2018 and 2019 saw increasing levels of tariffs apply to Chinese goods, all to force China into signing an FTA deal that never really got off the ground (and, IMHO, would never be fully adhered to by the Chinese side).