Thursday, September 8, 2011

Jobs and Exports

Today I heard two interesting facts about our economy for the July/August 2011 time frame. First, unemployment was flat. We aren't seeing new jobs. Second, exports were at an all time high. Here are some links with evidence, plots, and further analysis.

http://www.economicpopulist.org/content/big-fat-zero-jobs-august-2011-and-unemployment-still-91

http://seekingalpha.com/article/292427-exports-surge-to-new-all-time-high-in-july

To me this just called out that automation is making it so that companies don't have to hire humans to do things. After all, companies and making and even exporting more goods than even, but they aren't employing additional humans to do it.

That was just based on the brief sound bite of these two statistics. Looking at the plots though you can see this isn't just for right now. Look at what has happened with exports since the end of the recession in mid-2009. They have climbed from just over $120 trillion to just under $180 trillion. That's 50% growth in about 2-years. No wonder corporate profits are doing well.

Now look at the jobs numbers for that same period of time. Both unemployment and job counts are basically flat. Exports rose 50% with virtually no new hires.

I've heard people describe that some of the fact that employment hasn't gone up with efficiency is because of globalization and free trade. Those inevitably were significant factors in and around 2000. That doesn't explain this though. That's a rise in exports. That isn't stuff produced in other countries, that is stuff produced here and sold abroad. That is that part of free trade that really comes back to benefit us.  There definitely are people benefiting. The problem is that those benefiting represent a very small fraction of the population and no matter how hard an average person works, it will be virtually impossible to break into that group. Unless you have the capital to buy robots to make stuff for you, humans simply can't compete for large scale manufacturing today. There are likely other areas they can't compete in today either and there will be more in the future.