Workers are getting more expensive while equipment is getting cheaper, and the combination is encouraging companies to spend on machines rather than people.“I want to have as few people touching our products as possible,” said Dan Mishek, managing director of Vista Technologies in Vadnais Heights, Minn. “Everything should be as automated as it can be. We just can’t afford to compete with countries like China on labor costs, especially when workers are getting even more expensive.”
Vista, which makes plastic products for equipment manufacturers, spent $450,000 on new technology last year. During the same period, it hired just two new workers, whose combined annual salary and benefits are $160,000.
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.
Noted for June 19, 2013
1 hour ago
4 comments:
Clearly, there is a skills mismatch between what domestic companies need and what domestic job seekers possess. Any BLS chart shows that jobs are actually available. Folks just need to bring their skill sets up to date with the job market.
labor makes capital. i may buy a photocopier rather than hire a scribe, but labor designs and builds the machine.
Workers are getting more expensive, huh? Then why is it I get paid less each year? "Folks just need to bring their skill sets up to date with the job market," huh? Then why is it I have five times the workload I used to?
Don't know about the rest of you, but I'm feeling a tad undervalued here ...
some workers are becoming relatively more expensive than others. what this means is that the most productive workers who build capital are relatively cheap (they are paid a lot, but produce even more). an engineer who builds a tractor (capital) replaces at least 5 farmers. a farmer working without a tractor would have at least 5 times the workload to compete with a tractor. as farmers become tractor builders much more is produced.
Post a Comment