Jobs: the irresistible force meets the immovable object

 

The big challenge everyone's talking about today is how to get the millions of unemployed Americans back to work - create enough jobs that they can fill, and ensure that they have the necessary training to do those jobs.

However, that ignores the fact that all over the world, more and more people - particularly younger people - are desperate for jobs, but they aren't there to be found.  The US economy is no more than a microcosm of a much greater conundrum.  That same oversupply of job-seekers is fueling international illegal migration.  When young people face economic ruin at home, they've got nothing to lose by trying to move to a country where more jobs are available, even though the journey may be very dangerous and they may not be welcome at their intended destinations.

First, there's the supply of workers and potential workers.  I'll use Africa as an example, because that's my continent of origin and I'm more familiar with its situation.  Bloomberg recently reported:

Africa’s population has doubled in three decades and it’s now home to about 1.5 billion people, a figure that’s predicted to grow to 4 billion by the turn of the century. This growth has been driven by improved access to medical care, plummeting infant mortality since 1990, and persistently high birth rates. Already about 60% of people south of the Sahara desert are younger than 25, compared with one-third in the US, according to the United Nations.

The expected number of annual births in Congo is more than 800,000 greater than across the US or the European Union’s 27 member states. So while the developed world worries about getting old, Africa is getting younger.

. . .

Success will depend on both shrinking the existing rate of population increase, and also creating the economic opportunities — jobs are a key driver of growth in the early stages of development — for young people entering the labor market. Getting it wrong could fuel poverty, trigger more conflict and potentially spark mass emigration.

. . .

Sub-Saharan Africa will see 1 billion people enter the labor force between now and the end of the century, according to Bloomberg Economics analysis of UN Population Division data. Annual job demand is projected to peak at approximately 18 million in 2048.

Most countries on the continent already struggle to provide sufficient jobs. For every two people that joined Congo’s working-age population between 2005 and 2020, only one job was created on average, a pattern repeated across Nigeria, Ethiopia and other large states, according to Bloomberg Economics analysis of International Labor Organisation data.

. . .

In a worst-case scenario, that scenario could translate into the continent sliding ever deeper into poverty and political and civil strife, and encouraging mass emigration, with the reverberations felt across the world.

“Labor migration is an inevitable consequence of being educated,” says Charlie Robertson, the author of The Time Travelling Economist who has been monitoring developments in Africa for the past 15 years. “This is the most educated the continent’s ever been, but with insufficient savings to utilize that education there will be demographic pressure to emigrate.”

There's more at the link.

That demographic pressure is driving the wave upon wave of African illegal immigrants overwhelming European countries right now.  Along with similar pressures in South America and Asia, it's what was behind the surge in illegal alien migration to the USA under the Biden administration - and that administration's refusal to do anything to stop it has left us with enormous socio-political problems that will take more than one Presidential term to sort out.  It may take decades.  I personally view it as treasonable behavior by the Biden administration, but it's not my job to adjudicate that - perhaps fortunately . . .  President Trump has already shown that swift, vigorous law enforcement action can stop such mass immigration in its tracks, and even reverse it.  One can only hope and pray that his successors in office will continue such policies.

Be that as it may, we have the "irresistible force" of mass immigration from the over-populated, economically under-developed Third World threatening the First World.  However, the climate for such immigrants is likely to become even less welcoming once the reality of modern economics takes hold.

“It’s the most humbling thing I’ve ever seen,” said Ford’s chief executive about his recent trip to China.

After visiting a string of factories, Jim Farley was left astonished by the technical innovations being packed into Chinese cars – from self-driving software to facial recognition.

“Their cost and the quality of their vehicles is far superior to what I see in the West,” Farley warned in July.

. . .

Andrew Forrest, the Australian billionaire behind mining giant Fortescue – which is investing massively in green energy – says his trips to China convinced him to abandon his company’s attempts to manufacture electric vehicle powertrains in-house.

“I can take you to factories [in China] now, where you’ll basically be alongside a big conveyor and the machines come out of the floor and begin to assemble parts,” he says.

“And you’re walking alongside this conveyor, and after about 800, 900 metres, a truck drives out. There are no people – everything is robotic.”

Other executives describe vast, “dark factories” where robots do so much of the work alone that there is no need to even leave the lights on for humans.

“We visited a dark factory producing some astronomical number of mobile phones,” recalls Greg Jackson, the boss of British energy supplier Octopus.

“The process was so heavily automated that there were no workers on the manufacturing side, just a small number who were there to ensure the plant was working.

“You get this sense of a change, where China’s competitiveness has gone from being about government subsidies and low wages to a tremendous number of highly skilled, educated engineers who are innovating like mad.”

. . .

Between 2014 and 2024, the number of industrial robots deployed in [China] rocketed from 189,000 to more than two million.

These can typically include everything from robot arms used for welding, assembly and loading, spider robots used for high-speed “pick and place” movements and overhead gantry robots for precision tasks such as 3D printing.

The overall number of robots added in China last year was 295,000, compared to 27,000 in Germany, 34,000 in the US and just 2,500 in the UK.

And while it would be easy to put this disparity down to population size alone, China also blows its western rivals out of the water when it comes to robot density. It now boasts 567 robots for every 10,000 manufacturing workers, compared to 449 for Germany, 307 for the US and 104 in the UK.

. . .

Rian Whitton, an expert at Bismarck Analysis, says increased automation is also an attempt to mitigate the impact of [China's] ageing population.

“China has quite a notable demographic problem but its manufacturing is, generally, quite labour-intensive,” he says.

“So in a pre-emptive fashion, they want to automate it as much as possible, not because they expect they’ll be able to get higher margins – that is usually the idea in the West – but to compensate for this population decline and to get a competitive advantage.”

Again, more at the link.  (Article may be behind a paywall.)

Admittedly, the article above addresses the manufacturing economy:  but that underpins all other economic sectors, when push comes to shove.  Just as China is striving to maximize automation and minimize actual human workers, so US manufacturers are striving to catch up with that country and re-engineer their local assembly lines.  The same can be said of many service industries.  Did you notice, during the dockworker strikes over the past couple of years, that one of the constant demands from the labor unions was that ports and harbors should not introduce any more automation, or robotics, or labor-saving technology?  The unions are trying desperately to protect their members' jobs . . . and they're doomed to failure.  When it costs far too much to employ human workers compared to an automated solution, eventually the time will come when employers will say "Enough!" and make it stick.

For US workers in several industries, this is already bad news.  Without retraining and a deep-rooted change in their attitudes, they're going to end up in the economic dumpster.  However, it's worse for those heading for this country from places like Africa, in an attempt to find work here that they can't find at home.  Initially, they'll find at least something, through being willing to work for lower wages and/or in more dangerous, less desirable conditions than American workers will tolerate.  However, that won't last for long.  The list of industries already implementing technological solutions to their labor problems is already very long, and growing longer.  Manufacturing, fast food, farming, assembly operations, customer support, corporate administration, banking . . . the list of places where you'll find automated assistants and AI systems instead of a human being is growing by the day.  New jobs are not part of that equation.

It's equally bad news for the US education system.  Right now, a school-leaver is woefully ill-equipped to become part of our economy.  He's got far too much learning still to do - hands-on, productive learning - and too much touchy-feely politically-correct baggage to learn to discard, once he realizes that it's all been a lie.  Commerce and industry function on facts and reality.  If they don't, they go out of business.  Our education system currently does not teach facts and reality, and doesn't prepare its students to deal with them.  That may be an even bigger problem for us that China's current lead in automation.

Furthermore, consider what this immense level of automation means for countries that are struggling to establish their own industries and facilities.  They can't possibly afford to build a factory to assemble vehicles using their own labor force, when China (or, for that matter, similar factories in Europe or the USA) can deliver a finished vehicle, made to a much higher standard of quality, for less than a fifth of the cost of a vehicle manufactured locally (what with economies of scale, etc.).  In so many words, such hyper-automated production will destroy economies that can't compete at that level;  and those living in those economies will see that they have no future there, no way to earn a living, improve their situation in society, or hope for something better.  That being the case, they're going to leave for anywhere that appears to offer them a better opportunity.  The current immigration pressure on the First World is going to turn into an overwhelming flood.

We are literally creating this future as we speak.  All of the factors identified above are now in operation.  There's no way we can possibly turn aside from that future now, because just about the whole of the First World as it currently exists would cease to exist if we did.

What does this mean for us as individuals?  For someone like me, approaching the end of my life, I can only watch events unfold.  For younger people, who must find a way to support themselves and (hopefully) a family in due course, they're going to have to make some very blunt, realistic career decisions.  A degree in underwater basket-weaving or feminist studies may sound like a lot of fun, but it's going to fly like a lead balloon in an economy that will demand specific skills, attributes and attitudes.  Nations will no longer be able to afford those who contribute nothing to the economy and the needs of the country as a whole.  At best, those people will have to live on a minimal public dole, because governments won't be able to afford anything more.  Those willing to seek out jobs that will always be in demand, and are unlikely to be automated (e.g. the trades, technical fields that support automation, etc.) will do rather better.  Not sure how to get into them?  Talk to Mike Rowe.

Sound frightening?  It is.  Yet, that's the dilemma and the conundrum facing our politicians and business leaders today.  Go read the two articles I cited, and do your own search for more material on the subject.  We live in interesting times, no matter how much we may wish we didn't.

Peter