We noted in our prior post some of the facts and jarring effects of free trade and trade barriers upon American manufacturing employment. Those effects are now being voiced in the pitched rhetoric of the latest electoral season. Free trade, while a linchpin to global (including American) growth and well-being, creates winners and losers, as pointed out well in a recent article in The Economist (“Open Argument,” 4-2-16).
The question then, from an employment standpoint becomes, how do we help the so-called losers? That is, what do we do about all those displaced workers? Following are a few thoughts and ideas that might help move us forward:
- Look to Germany. While also absorbing the twin shocks of competition from China and from nations east of the European Union, Germany has continually managed to upgrade its workforce skills, thanks to a vibrant system of apprenticeships. The U.S. still places too much emphasis on four-year education, and not enough on job and trade skills.
- Rethink labor market policies. Through job exchanges and courses, “more could be done to help workers who lose jobs find new ones,” note the Economist’s editors. Easier said than done, to be sure, but historically our safety net is either too narrow (temporary unemployment benefits for a fixed period of time for the displaced… and then what?) or too broad (paying everyone including those in dying industries those same benefits without an eye to retraining in new, potentially more promising sectors).
- Relocation grants for workers hurt by trade. Many older, two-earner families may be disinclined, but lots of younger less-skilled workers might be well-served, and moving to newly vibrant employment areas does have a certain Darwinian logic.
- Create a system of portable benefits. Too often the displaced job-seeker finds employment not only at less pay but with reduced or no benefits (healthcare, pension, etc.), making the new position far less tenable than it might otherwise be if benefits were portable. Perhaps even a system of wage insurance “might have merit,” say the Economist editors.
- Finally, retrain workers for the very different jobs of the 21st century. As Ian Bremmer points out in a recent Time magazine article (“The Risk Report,” 4-25-16), while many manufacturing jobs have been re-shored back to the U.S. in recent years, there’s no debating the change that has been wrought through modernization and automation. The new century’s workers must be trained in the new century’s jobs, and that includes embracing the new technologies, and providing the training that must accompany them. Just as companies are embracing robots, 3-D printing, process improvements and modern ERP systems, workers need to be trained in the programming, maintenance and application of today’s newest tools. There will be fewer of these jobs than the auto line-workers of the 1970s, but they will be better jobs, and
If economic disruptions and the perils of trade are destined to be a continuing part of our landscape in the changing face of global competition, then it’s high time that newer, more creative solutions have a place in that landscape too. This country was built on a backbone of productive jobs, many in the manufacturing and industrial sector of the past century. Through education and creativity, we can still create some of the most productive, highest paying jobs in the world.
But we won’t get there tomorrow mired in the thinking – and hot rhetoric – of yesterday and today.