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Are retail jobs going the way of farming and manufacturing?

Discussion in 'Sports and News' started by Dick Whitman, May 23, 2013.

  1. Dick Whitman

    Dick Whitman Well-Known Member

    Very interesting little piece from this month's issue of The Atlantic (Hi, Versatile!) on the decline of retail jobs and what it means for America:


    I post it because it dove tails nicely with discussions not only about Wal-Mart's effect on American, but also one we had on the political thread a few weeks back - I think it was me, Dooley, Azrael, and some others. I argued that "creative destruction," as it is known, is ultimately good for the country, because low-skill jobs are replaced by higher-skill jobs that ultimately lead to a higher standard of living.

    Basically, I'm against dead weight use of resources - cashiers when a self checkout is just as good. Az said, not without merit, that the same companies who eliminate such jobs should bear some responsibility in contributing to the safety net for the cast-off employees. Dooley called me a Nazi. Or maybe that was in a health care digression. Or perhaps both.

    Anyway, the Atlantic piece makes the argument that there is a fragmentation of the American shopper going on into, to oversimplify, two groups:

    • Wal-Mart shoppers who want discounted prices, damned be the shopping "experience."
    • Wealthier shoppers who prefer service and experience over prices. Think of someone buying groceries at Trader Joe's, which is far better staffed than your average Wal-Mart or other big box store.

    Also good stuff in the piece about the effect of online shopping. And the fact that retail jobs lost aren't being replaced the way that, for example, farming jobs were when industrialization occurred.
  2. YankeeFan

    YankeeFan Well-Known Member

    You can't buy a hot, fresh espresso over the internet!
  3. Uncle.Ruckus

    Uncle.Ruckus Guest

  4. Dick Whitman

    Dick Whitman Well-Known Member

    "You can't take a computer with you to the john!"

    Remember that one?
  5. The Big Ragu

    The Big Ragu Moderator Staff Member

    When we moved from an agricultural economy to an industrial economy, nobody saw the clear outcome at the time. All they saw was the American farm no longer being the same viable way to feed a family -- being put out of business by agribusiness and the technologies that made that possible.

    There is no single job type or industry that is good for America's economy. Our economy continually evolves over time -- mostly based on new technologies and the productivity increases they spawn, which allow us to free up resources for other things. Along with that, comes a rise in your standard of living over time. We no longer each have to farm our own potatoes to live.

    In 1900, 40 percent of America's workforce was employed by agriculture.

    Today, only 2 percent of our workforce is in farming, and we are 20 or 30 times richer as a nation than we were in 1900. We grow a lot more food in America today than we did in 1900, with 1/20th of the labor devoted to it. It freed us to do more things -- and live better because of the things we could produce with the freed up resources.

    That led to a manufacturing-based economy. And people having the wealth to consume those manufactured goods. That, too, has changed. Manufacturing jobs have been declining in this country since 1950. Yet, manufacturing output has risen dramatically over that time. Even with all of the talk about the decline of manufacturing (the jobs required have declined), manufacturing in the U.S. makes more stuff than it did even 20 years ago, let alone 50 years ago. And that is WITH all of the outsourcing to countries with lower standards of living than ours.

    We are seeing the same kind of thing in retail, I guess. Technological changes are making bricks and mortar retail an anachronism before our eyes and it is happening quickly. To sit at this point in time, though, and conclude that the jobs aren't being replaced the way that jobs were replaced during past economic shifts is way too soon. If you were an American farmer in the early 1900s, you just saw the death of your livelihood at that time. You weren't seeing the shift that was in progress and manufacturing as the future.

    It's particularly hard to know how this shift is going to play out right now, and to where, because we are in a worldwide economic depression, and it is likely to last a while. In those conditions, you might see the technological shifts that reduce costs, but because consumer and industrial demand for most things is flat to down, you are not going to see the new areas of the economy yet that we can shift resources to create even more goods and services -- and in the process, boost the standard of living, the way standard of living has continually increased due to these shifts that largely occur because of technological advances.

    I think what is difficult for people to understand -- because of the displacement that occurs (and has occurred with each of these changes in our underlying economy) is that the long-term effect is invariably good for people. Even if your job has become obsolete today and it is stressful and you are trying to figure out how you are going to feed your family.

    When you look at the picture picture behind your story, when we spend less time on one thing, it frees up time to spend on other things. And our overall standard of living increases. It is why people today walk around with smart phones and laptops and tablets and 1,000 channels and movies on demand and more food choices in their supermarket and clothing choices and home ownership is at levels it never was before. ... and it all costs less in terms of how many hours the typical person has to work to afford those things than more basic things like a calculator or a typewriter cost 40 years ago.
  6. Dick Whitman

    Dick Whitman Well-Known Member

    Ragu, I agree with all of that. Though there's really not much to "agree" about - it's pretty much all accepted fact at this point, among the people who study it. The purpose of the social safety net should be to retrain workers, and support those who are not yet retrained as a bridge to when they are retrained. It should not be to help a modern economy cling to obsolete jobs.
  7. YankeeFan

    YankeeFan Well-Known Member


    Bad idea to order it ahead of time though. An espresso should be drunk within seconds of it being pulled. It goes flat if it sits.
  8. deskslave

    deskslave Active Member

    I once had a conversation with the girl cutting my hair about how her parents didn't really approve of her career choice. But as I pointed out, that's one thing that definitely can't be outsourced. Of course, every time I say "that's something that can't be outsourced," someone proves me wrong. Maybe in 25 years, we'll be getting our haircut by robots programmed by Bangladeshi grad students.
  9. The Big Ragu

    The Big Ragu Moderator Staff Member

    Dick, I can be a bit didactic on here. In this case, though, unfortunately, I find that the reality isn't accepted by a lot of people. There are large segments of people that want to cling to the outdated -- I get it. Nobody wants to be displaced. But it's hard to watch, because nothing good happens when you stand in front of a speeding truck.

    You see it through labor and business political activity, their money that gets tossed at politicians and the legislation it buys. In particular, we are riddled with protectionist policies that hurt our economy and debt-financed public money (which serves as an anchor on our economy) wastefully given to outdated sectors of our economy that politicians want to boost for populist reasons.

    It's hard to do this, but the best course of action is to step aside and let demand dictate supply -- without intervention. The jobs will follow.
  10. deskslave

    deskslave Active Member

    I fail to understand the logic that says combining a continually expanding global population with a reduced need for labor and an increasing pool of sources for said required labor must necessarily lead to a situation in which "the jobs will follow."

    Why is the U.S., or any other country, simply guaranteed to have enough jobs? Is there any way that you can justify that optimism, other than to point to "well, it's always been that way"? A lot of things that had "always been that way" have stopped being that way. And one of the things that hasn't always been that way is upwardly mobile former backwaters with burgeoning pools of affordable, increasingly educated labor.
  11. Dick Whitman

    Dick Whitman Well-Known Member

    To me, this is where government comes in, no? Retail jobs are disappearing? Subsidize or even create - like via the stimulus - jobs that add value to the economy. Like infrastructure improvements. Or whatever labor is going to be required to map the human brain. Or the genome before it. Even a staunch free marketeer like Ragu would, I imagine, agree that government has a role to play when it comes to preventing market failures. But forcing Wal-Mart somehow to hire cashiers when the self checkout line can do the trick just as well, that isn't good for anybody in the long-term.
  12. deskslave

    deskslave Active Member

    I can't see how you could argue that Ragu would be in favor of anything remotely like that, when he's plainly stated that you have to "let demand dictate supply." I guess my question to him is why assume that the demand will be for U.S.-based jobs.

    And when you have many of the companies at the forefront of this trend actively working against any government involvement*, that doesn't fill one with much confidence, either.

    *-And that's in pretty much anything, including but not limited to the education that would be required to put people in a position to, for example, map the human brain.
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