Wall Street Journal senior economist Stephen Moore recently wrote a column about “takers and makers”, revealing that ”More Americans work for the government than work in construction, farming, fishing, forestry, manufacturing, mining and utilities combined.”
Twice as many people (22.5 million) work in government than in manufacturing (11.5 milion).
Upon hearing this, many will launch into their political persuasion’s talking points (regardless of leanings). But it isn’t that simple.
It’s not the 60s anymore
In 1960, about 8.7 million people were government employees. In 51 years, that number has almost tripled. I don’t have a breakdown of the increase in front of me, but a 300% increase is large no matter how you look at it.
Moore derisively calls these 22.5 million “bureaucrats”, which to me coveys the image of the corrupt Daley regime in Chicago or an uncaring, inefficient Department of Motor Vehicles (not what you get in Kalispell’s blue building).
Based on the comments I hear, most don’t view rank and file firefighters, police officers, teachers, train conductors, military personnel and the like as bureaucrats.
In one example, Moore mentions the doubled public school employment between 1970 and 2005, referencing a University of Washington study, as an example of government inefficiency given that standardized test scores haven’t doubled in that time.
Electric shock and cages
In the 1960s, students with Down’s Syndrome, mental deficiencies, autism or physical challenges were treated as second class citizens. Today, they learn as a part of mainstream student populations, just as employers do. Doing this requires increased staff. Some kids have a single staff member dedicated to them. Today we teach topics in school that didn’t exist in 1960, like computers, robotics and computer-aided design (CAD).
I don’t think anyone, with the possible exception of the current Montana Legislature, would wish for a return to the 1960s. Yes, that was sarcasm. Mostly.
If you look at the manufacturing and industrial changes since the 60s, it’s hard not to see the migration of the steel, textile and heavy industries overseas as having a significant impact on employment numbers.
While government numbers have gone up markedly, Moore didn’t address the disappearance of manufacturing and industrial jobs during that same period.
The falloff of employment in those industries didn’t happen in a vacuum.
Blame the third world
The industrial revolution in the U.S. transformed business: Steam, electricity, internal combustion.
In the last 20-30 years, it happened again; fueled by computers, industrial automation and the rise of the third world.
While these changes were decimating U.S. presence in industries like heavy equipment, steel and textiles manufacturing, we retain a reticence to pay anything above 1960s prices for commodities like steel, lumber and textiles.
We kept prices down and competed with cheap overseas labor through industrial automation and computers, but that cost jobs. When someone is laid off from a foundry job, where do they go?
If someone laid off after two decades in one of these industries has an opportunity to share their skills with young people looking to learn a trade, and in doing so, keeps their family off of taxpayer-funded public assistance – are they a maker, a taker or a bureaucrat? If in that 20 years they didn’t take the initiative (on their personal time) to remain employable by learning a new skill (welding, software, repairing industrial robots, etc), who’s responsible?
Meanwhile…
Industrial automation is replacing cheap third world labor with labor that’s even cheaper. China supplants India, who “stole” the work from US workers. Advances in automation allow us to keep prices low and allow our businesses to avoid paying modern wages for dangerous work now done by machines, but they also eliminate third-world jobs here in the states.
Are those jobs we want? That laid off industrial worker who now teaches…do we *want* them teaching a 1960s or 1970s skill in a 2011 economy?
Businesses of all sizes outsource work because it’s not efficient to keep people on staff to do that work. Business is then more flexible and the jobs we keep are usually more secure, but low-value employment is hammered by it. Is that good or bad?
Nothing is as simple as the politicos want you to think.
Want to be patriotic? Invest in yourself, make something that people want/need, and create your own future.
Want to learn more about Mark or ask him to write about a business, operations or marketing problem? See Mark’s site or contact him via email at mriffey at flatheadbeacon.com.