As United States-based companies paid workers in India, China and the Philippines almost $10 billion last year for services that can be performed more cheaply by them than Americans, the job crisis in US should be blamed on changing technology and not on outsourcing, according to an economist.
Most job losses over the last three years have not been due to American jobs 'moving' elsewhere, Robert B Reich, former Labour Secretary, who is now professor of social and economic policy at Brandeis, said in an article in The Wall Street Journal.
It is true that US manufacturing employment has been dropping for many years but that is not primarily due to foreigners taking these jobs, he said, adding factory jobs are vanishing all over the world.
Manufacturing, said Reich, is following the same trend as agriculture.
As productivity rises, employment falls because fewer people are needed, he said.
"Want to blame something? Blame new knowledge," said Reich, who pointed out that job losses go well beyond the factory floor.
With digitisation, high speed data networks and improved global bandwidth, a lot of back office work can now be done more cheaply abroad, he said.
Any job that is even slightly routine is disappearing from the US, Reich pointed out, but said: "This does not mean we are left with fewer jobs. It means only that we have fewer routine jobs."
"When the US economy gets back on track, many routine jobs won't be returning, but new jobs will take their place. A quarter of the Americans now work in jobs that were not listed in the census Bureau's occupation codes in 1967. You see only the loss of old jobs. You are overlooking all the new ones," he said.
Over the long term, symbolic analysts will do just fine, as long as they stay away from job functions that are becoming 'routinised', he said.
"They will continue to benefit from economic change," he added.
But apart from recessions, demand for symbolic analysts in US will continue to grow faster than the supply, he said.
America 's long-term problem, said Reich, is not too few jobs but the widening income gap between personal service workers and symbolic analysts.
The long-term solution is to help spur upward mobility by getting more Americans a good education, including access to college, he said.
Unfortunately, said Reich, just the opposite is occurring. There will be plenty of good jobs to go around but too few of America 's citizens are being prepared for them, he said.
"Rather than fret about 'losing jobs' to others. We ought to be fretting about the growing number of our young people who are losing their footing in the emerging economy," said Reich.
