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This is the key question. I agree something happened, actually, many things happened.
Nixon Travels — China
This was a start on the road to an excess of world wide LABOR. About 1.2 billion people who did not participate meaningfully in the world economy just joined. It took a couple of decades before it began to be felt, but this was the start in 1972.
- In 1981, IBM introduced the Personal Computer to corporate america. Before that, there were some Atari systems and Radio Shack TRS 80 (Trash 80's!) personal computers, but IBM legitimized it, and corp. america could depend on an adequate supply chain and standards for hardware and software. This ushered in the widespread use of spreadsheets, word processing, and database applications to the masses. There were also new custom applications like AutoCad that dramatically reduced the need for draftsmen, as one person could do the job of 10 working manually. The ensuing productivity kept lowering product cost for decades. This was hostile to labor.
- Robots, began entering the workforce in the 70's, use has become commonplace, replacing the need for humans. Robots don't call in sick on Monday.
Robot - Wikipedia, the free encyclopedia
- Widespread use of email. This has made many information based / information sharing jobs "geographically independent".
- Widespread use of the internet. This has made many information based / information sharing jobs "geographically independent".
- Advances in the quality of telephone services, especially internationally and vastly reduced cost of telephony. This has made many information based / information sharing jobs "geographically independent".
So, advances in computer and robotic technology are reducing the need for many traditional jobs in america, and widespread use of email/internet/telephony allow us to tap the huge job markets in asia, primarily China and India, but also Japan, S. Korea.
These are all 1970's to 1990's phenomenon, and they all add up to offshore jobs or eliminate traditional jobs. What we are left with is too many people in the US, chasing a smaller pot of jobs. For decades we have been told not to worry about the loss of those "low tech" jobs in the US, as they would be replaced with better "high tech" and "service sector" jobs that would not be so boring. One bad thing about service sector jobs, they are all "discretionary", instead of hiring someone to do them, we could just do it ourself when times get hard, and that is what we typically do. That is a big reason why unemployment remains high 2 years into the recovery. The nature of the jobs people did the last 20 years is not at all the same as the nature of jobs done in the 20 years before that, say 1960-1980.
The trouble I think is not really lack of jobs...here in southern Louisiana we have lots of good jobs that are going wanting for qualified applicants, and I believe that is true for other places in the U.S. The problem is having a workforce that is not sufficiently nimble to switch careers and move to where the jobs are.
Something that should come out of the Great Recession is that people need to be prepared to have their jobs become obsolete, and always keep their eyes out for the next up and coming field that they can get education in, so that they can be prepared for market shifts in the future. I am looking to move into health, environmental and safety management, a growing profession, and my wife is looking to get an education as a sonographer, a field that appears to have excellent growth for the future.
All throughout human history people have had to relocate to find better opportunities, from following herds of animals around, to moving from a drought stricken area to a more fertile one, and today to move from one area bereft of new job opportunities to one with better prospects. Nowadays you can often make those moves just by getting more education, but sometimes you will need to leave where you called home and move away. The Okies had to do it in the Dust Bowl, and now a new generation of Americans need to do it too.