Business Magazine

Disappearing Jobs and the “Hollowing Out” of the Middle Class

Posted on the 29 January 2013 by Pjfaur

disappearing jobsFor nearly five years now, we’ve been waiting for the millions of jobs lost in the Great Recession to return. Why did they disappear? Democrats blame Republicans, Republicans blame Democrats, and everyone blames the Chinese.

More important is this question: When will they come back? The depressing answer, probably, is “never” for many of those jobs. We’re all looking for the day when the unemployment rate, now just below 8 percent, gets below 7, and then closer to 6. We’re going to be looking for quite a while, it seems.

The truth, according to the Associated Press, is sobering. The science fiction writers have been warning for decades that machines and computers could someday steal our jobs away. It looks as though that day has arrived.

As hard times hit businesses over the past five years, they’ve found ways to make software, hardware and robots do jobs that humans used to have. We all know the economy has turned around on many fronts, but the turnaround has been called a jobless recovery. In fact, 42 months after the Great Recession ended, the U.S. has gained only 3.5 million, or 47 percent, of the 7.5 million jobs that were lost. The 17 countries that use the euro had 3.5 million fewer jobs last June than in December 2007.

I’ve reached the point that I never have to walk into a bank anymore. I pay bills online. I deposit checks by scanning them. I have clients who pay me with direct deposit. If I need cash, I get it while I’m checking out at Target or grab it from an ATM. I’m not alone; you probably do the same. And each time we act as our own teller, we help eliminate countless, real teller jobs.

The same is true of the self-checkout lane at the supermarket. Each time we scan our own groceries, we help eliminate the job of a checker.

You might argue that other jobs are created by technology, and it might have happened in the past, but that doesn’t seem to be the story this time. Companies in the Standard & Poor’s 500 stock index reported one-third more profit in the past year than they did the year before the Great Recession. They’ve also expanded their businesses, but total employment in these companies, at 21.1 million, has declined by a half million.

No field appears to be immune. At least some of the tasks done by lawyers, doctors and accountants can be mechanized. Doubt it? Check out LegalZoom.com, WebMD.com and TurboTax.

There are no easy answers here. Keep that in mind the next time you start to blame the Democrats or the Republicans for America’s economic woes. And if you’re smart enough to figure out how to profit from this situation – or how to create more jobs – more power to you.

Disappearing jobs and the “hollowing out” of the middle class


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