Via Ryan's blog. Have a look at this article from the Washington Post. It's by Alan Blinder -- the eagle-eyed among you (at those who sit on the side of the room nearest the door) may recall my putting his name up on the board in the discussion on Tuesday (originated by Hugh) about "personal service" jobs being less "offshorable". Blinder hammers on that theme here. Keep in mind: jobs that place a premium on personal service, which Blinder suggests may be our future, may not necessarily be the most glamorous, high-status jobs in the world.
Just as an exercise, and using the terminology from class on Thursday, pick out his "independent" and "dependent" variables -- his causes and effects. Note how Blinder focuses on a couple of reasons white-collar workers should be worried. One is the technology, which Friedman in The World is Flat focuses on a great deal, obviously. But another cause of potential "wage-setting in Beijing", to use Freeman's term, is arguably more important: the massive (and increasingly educated) labor supply we're talking about in Asia and elsewhere.
Why do I say "more important" than the technology? Consider that if we were talking only about a very small supply of highly-skilled people overseas, then the consequences for our labor markets would be correspondingly limited. In that case, the availability of technology to the developing world would be nearly irrelevant in terms of Americans' economic prospects. By contrast, with only low technology availability in the developing world and a high labor supply, the size of that labor supply matters at least some; remember Freeman saying low wages in China affect Americans a bit, and consider the fact that there are other "substitute" ways a large labor force can affect global wages, such as through migration. But when you're talking about a large labor supply interacting with high technology, then you've got serious potential for outsourcing, and this is why the issue probably "got bigger" after about 1995 (as Friedman would say).
Thoughts?
2 comments:
It's been my understanding that we've been turning into the whole post-industrial/post-modern service-oriented economy anyway, for a really long time. Technology is an imperfect replacement for face time, or more of us would work from home (or, in we students' case, attend class from our dorm room desks, pants optional).
The face-time need or the need for an actual human presence is, after all, why our tuition keeps going up, right? (Basically.)
I wonder how this is affected by/affects the uh, growing demand for military personnel in the US? That's definitely one service route.
These domestic non-offshoreable jobs are not going to be the future of the US. After all, these jobs are non-exportable. We can't have a comparative advantage in something we can't export. Increasing investment in science and technology and education makes sense to enable the US to develop new export industries as our comparative advantage in older industries wanes.
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