Friday, January 9, 2009

This time the recession is different

In listening to the talking heads sprout about the current “recession” I keep hearing references to past economic downturns. It seems that no one wants to understand that this recession is different in scale and kind from all others.

First, the book title “The World is Flat” wasn’t just a book title. It truly described how connected our world is and how different it is from what went before. Second, in all previous recessions the jobs came back, this time they won’t!

Big talk for a small personal blog ain’t it?

This recession is different in scale because of the connectivity of global finance. Because the slow sale of toys in New Jersey causes a factory in China to stop production. In all the other recessions a down turn in one country only had a marginal effect in another. This time it’s true, if the United States catches cold, a country half way around the world will sneeze.

Jobs that are lost to this recession will be in finance, manufacturing, and industries that support them. Business in India, Thailand, China and other countries now have the capacity to compete directly with business in the US and at lower wage scales. Part of this recovery will be shifting work to those cheaper locations with the corresponding loss of income in the US.

We must figure out how to support our out of work while we fit them for the new jobs that we still have to figure out how to create. Pretending that workers who invested in educating themselves for the jobs they just lost can predict what they need to do to find a new job when the economic experts can’t answer the same questions just plain dumb.

The people loosing their jobs did the best they could with the advice our teachers, our media, and our government gave then I think all those advisers have an obligation to do their homework and tell those out of work people what new direction they should follow. And if you think it’s not the government’s business, it was the government that was bragging only a few short years ago that allowing those jobs to migrate “off shore” was a good thing and would create jobs.

Now it’s time for the government to show the workers where those jobs are!

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