We Can't All Work For Apple or Microsoft!
The trend in developed first world' economies toward out-sourcing' production
, spells the end of traditional manufacturing base in countries such as the U.S and the UK.
The development of the internet and advanced communications has aided globalization and the growth of multi-nationals at a phenomenal pace, based upon the export of jobs to countries with very recent low tech industrial heritage.
In the rush to access the plentiful and cheap labor in the burgeoning industrial economies such as China and India, the companies out-sourcing production have benefited their shareholders at the expense of the working population, upon whose sweat they have built their companies.
Out-sourcing production is similar to rolling a snowball down hill! Once it is let loose it gathers speed and grows in size. Companies content with manufacturing in their own country see their competitors lower prices as a result of out-sourcing, then for good business reasons seek to out-source as well, so they can stay in business.
The onset of the rot in a nation's manufacturing base does not just stop at the unemployment line or the gate of the closed factory. Once all of the machinery and equipment associated to the production of goods has been boxed-up and shipped abroad, the technical know-how and the knowledge of past generations that have built the technology, disappear abroad forever.
The country benefiting from exported manufacturing technology is presented with the opportunity of refining and developing systems, processes, techniques, materials and knowledge, to a point where production has evolved and is becomes an entirely new technology.
There are many cottage' industries remaining in first world economies, remnants of industry developed over many generations, where there are now just one or two individuals left from the days when the industry was based in that country. Once these people are gone, their knowledge dies with them.
Once technical knowledge and know-how is lost, there is no way back for that industry. The new owners of the means of production of the goods we buy and manufactured abroad, hold all the aces.
The explosive growth of the Chinese and Indian economies is being built on the technical knowledge of generations of workers of first world economies. Without transfer of this knowledge base and manufacturing capacity, it would not have been possible for the Chinese to have developed their economy at such a pace.
Overtime, as wage bills increase, the cycle of out-sourcing industrial production will continue, with manufacturing switched to other developing nations with cheaper labor, lower environmental and welfare standards.
The result of exporting jobs overseas is borne out by statistics, which are becoming particularly frightening. In the U.S, one in five are unemployed. One in nine families are unable to make the minimum payment on their credit cards. One in eight mortgages are in default or at foreclosure stage. One in eight Americans are on food stamps. The statistics are equally depressing in the UK, France and in other developed countries.
The French as is their want, have been demonstrating about a proposed increase in retirement age from 60 to 62. Similarly in the UK, the government has plans to increase the retirement age. First world countries have aging populations. To generate the wealth to continue to provide pensions and welfare will be a difficult trick to accomplish with less people of working age to tax and higher unemployment.
Global corporations such as Apple, Microsoft, Google, are at the forefront of software development, research and development and high tech production. Unfortunately, there are not enough jobs in these high tech companies for most living in the developed economies to put food on the table and provide a reasonable standard of living. This means that increasing number of unemployed will merge into and expand the under-classes' already in existence.
Sooner or later the pressure of people with no hope, including the middle classes and the highly educated with no job prospects will take its toll. First world Governments need to wake up and smell the coffee, before its too late!
We Can't All Work For Apple or Microsoft!
By: Bill Bloggs
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