Thursday, May 19, 2011

The Jobless Non-Recovery: Why There Are So Few Good Jobs

A reader asked me why there are so few decent job openings.

Here is an expanded version of my answer. You'll note that it includes liberal, libertarian/conservative, and apolitical explanations.
  • Per Marx, unbridled capitalism results in the rich putting maximum profits in their own pockets and letting as little as possible dribble down into new hiring. When employers do hire, no matter how rich, they usually pay the worker as little as possible, thus exacerbating the gap between rich and poor.
  • Ever more can be automated. That means, for example, that every innovation--for example, the iPhone, requires only a relative few people to create it, and ever fewer people to build it.
  • In the era of the Net, sales can often be done more efficiently by replacing expensive commission-based salespeople with a great website and interface.
  • It has become so very expensive in the U.S. to hire an employee: On top of Social Security, MediCal, disability, unemployment insurance, Americans With Disabilties Act expenses, and state mandates, there's ObamaCare, with paid fraud-riddled "family leave" on the horizon. And then there are the financial and human costs of the ever increasing wrongful termination, sexual harassment, workers compensation, and racial discrimination lawsuits. While, of course, some of those claims are legitimate, ever more are not--In this tough economy, it's more tempting to try to steal a windfall from the employer.
  • Because ever more work product can be transmitted over the Net, employers find it feasible to offshore many more jobs. And the early experiments in offshoring have yielded important lessons--more of those offshore workers are doing a good job.
  • The U.S. will be ever less competitive against low-cost countries, especially in Asia, with their ever higher-quality workforces.
I am coming to conclude that even people who lack the gift or burning desire to be self-employed should consider learning that art. Running your own simple business will likely be one of the U.S.'s few remaining sources of well-paying, stable employment. To that end, you might want to read my article, The Un-MBA.


Anonymous said...

Well, I'm giving self-employment a go again. I once ran my own business and loved it. Now I'm starting a marriage and family therapy private practice. It's exciting! I get to use all those sales and marketing skills I learned in my corporate jobs to market my practice. Wish me luck!

Anonymous said...

What do we do about health insurance when we are self-employed? It costs a fortune, and the coverage is poor. Marty, do you have any good suggestions? Thanks!

Marty Nemko said...

Most recent anonymous, this article offers possibly helpful info re health insurance for the self-employed:


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