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Ear to the Ground

U.S. Employers Pick Machines Over Manpower

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Posted on Jun 10, 2011
Flickr / uafcde

Rather than hiring more workers as the U.S. economy lumbers back to life, timid employers are replacing human labor with machinery wherever they can as the costs of employee compensation have risen while the price of foreign-produced automated equipment has dropped.

Some economists say companies are loath to hire because the recovery is so slow, a problem that would be eased by increased demand for goods and services. With no increase expected any time soon, this is crippling news for millions of unemployed or underemployed Americans. —ARK

The New York Times:

Two years into the recovery, hiring is still painfully slow. The economy is producing as much as it was before the downturn, but with seven million fewer jobs. Since the recovery began, businesses’ spending on employees has grown 2 percent as equipment and software spending has swelled 26 percent, according to the Commerce Department. A capital rebound that sharp and a labor rebound that slow have been recorded only once before — after the 1982 recession.

... Indeed, equipment and software prices have dipped 2.4 percent since the recovery began, thanks largely to foreign manufacturing. Labor costs, on the other hand, have risen 6.7 percent, according to the Labor Department. The rising compensation costs are driven in large part by costlier health care benefits, so those lucky workers who do have jobs do not exactly feel richer.

... To add insult to injury, much of the equipment used to replace American workers is made by workers abroad, meaning that capital spending is going overseas. Of the four pieces of equipment Vista bought last year, one was made domestically. The others came from Israel, Switzerland and Germany.

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By Lew Ciefer, June 12, 2011 at 12:51 pm Link to this comment

Okay, this is satire, right? Tell me people aren’t that stupid about economics. It isn’t satire? Oh sweet Jesus!

This article sounds like all that ‘Hope and Change’ ain’t! Bwaaa! Whodda thunk it, huh? Central planning of an economy is a guaranteed disaster. But in defense of the Clueless One and his crew, it’s not like there’s a former U.S.S.R., Red China, Vietnam, North Korea, Cuba, Venezuela, and a host of other failed centrally planned economies that demonstrate that fact.

Irrefutably, one huge benefit to humankind resulting from so-called ‘globalization’ is that a journalism degree has reached its true market value as one of the worse degrees one can pursue; with an average entry level income of about $35,000 annually. Small wonder the Media is full of misinformation about economics and especially globalization fear-mongering.

Did I read someone stating that an economy can’t grow without demand and certainty about taxes? Imagine that!

Those new pieces of equipment require maintenance. And that’s where the additional jobs—besides the two new hires mentioned in the article—will be. In the service industry! That would be a local service industry. And service industry jobs historically provide much better pay scales and benefits than laborer jobs in plants.

Man has modernized and chosen technology over manual labor since he first crawled from the primordial ooze. Humans used to kill each other with their bare hands. Then one—Herb—realized he could kill more ‘Others’ with a big branch. The new technology required a new skill so that Herb could fully understand the power he held in his hands. Herb’s cousin—Albert—answered the call and invented basic math; adding, subtracting, multiplication and division. With basic math Herb realized that the Us could kill more ‘Others’ with fewer Us members. This resulted in the first unemployment crisis as ten little Us warriors were no longer needed. Another member of Herb’s warriors who had a mind for basic math—Norman—invented percentages and explained to Herb that by capturing more ‘Other’ women with fewer Us warriors, each Us warrior would get more ‘Other’ booty to ravage. Less effort, more booty = higher production, lower unit cost.

And what about the ten unlucky little Us warriors that were no longer needed?

Well, one of them—George—ran off to sulk after having lost his job. While sitting in the cool shade of a tree George grabbed a rock and started beating the rock against a very heavy piece of hardwood branch that had fallen to the ground. As George sat there beating that branch with the rock he noticed an odd shape and a thought came to him; George started beating the branch with the passion of a man possessed, thinking what he’d like to do to Herb for having fired him. When George finished beating the branch he grabbed it with one hand and grunted; UG! He called it ... club! Soon George hired five of the nine unemployed little Us warriors as well as lured—by offering a higher percentage of babes—four more experienced Us warriors from Herb. The new club technology allowed George and the boys—the new ‘Us’ or ‘Other’ on the block, depending on perspective—to swing with one hand leaving one free to grab ‘Other’ females by the hair and drag them off.

From this came the cosmetics and designer clothes industry for all those females to keep them from nagging the boys to death which also meant the boys had to diversify into other ventures like agriculture.

And there boys and girls was the first global economy born! This is a true story. The names have been changed to protect the innocent.

If you like hunger, starvation, toothaches, dying from a broken bone, the plague, etc., become a Luddite.

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prisnersdilema's avatar

By prisnersdilema, June 11, 2011 at 9:25 am Link to this comment

Except that there is no recovery, the economy is not lumbering slowly back to life, instead its slipping into a deap coma..where at somepoint, someone will pull the plug, and life support will be terminated…

we have spent over a trillion dollars to get where we are now…with unemployment and under employment at around 17%...

while congress prevented meaningful financial reform of any kind, the plutocracy continued to do the very things that got is where we are today, negotiated trade aggreements, outsourced jobs overseas,  downsized..

They have maximized their profits, yet don’t seem to realize that when everyone is unemployed who will buy their products? That’s where debt slavery comes in..

As they face greater compettion from non American corporations, they eventually will want more from the taxpayer, while at the same time stabbing their workers in the back….

The politics of the Democratic, and Republican party, is a disease, worse than cancer, they let it happen and did nothing to prevent it..

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blogdog's avatar

By blogdog, June 10, 2011 at 11:47 pm Link to this comment

even on-off switches require maintenance… robotic maintenance? indeed! where’s
my robotic maid, butler, cook and gardner?

wait a minute, I enjoy gardening, cooking, even serving guests… guess I am a
Luddite

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By Maani, June 10, 2011 at 10:13 pm Link to this comment

This is news?!  It has been happening since the advent of the roboticized assembly line, and happened even more radpily with the advent of computers.  Same as it ever was…

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By thethirdman, June 10, 2011 at 3:17 pm Link to this comment

I’m excited about progress.  In fact, I can’t wait till our planes start flying
themselves and douche bag pilots get their pink slips.  All your hard work and
American ingenuity still won’t get you health care.

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rico, suave's avatar

By rico, suave, June 10, 2011 at 1:15 pm Link to this comment

Come on all you Ned Ludds out there, take off those metaphorical sabots and throw them into those metaphorical 19th century English cotton jennies. Machines don’t need health care, or child care, or family leave, or pensions. Just on-off switches. It must be hard for “progressives” to accept progress in economic productivity.

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