Working class Americans have been unable to compete for jobs demanding specialized technical skills, while the places they live have been hollowed out by shifts in global supply chains and the death of low-skilled manufacturing. So long as these workers feel left out of the economic mainstream, they will remain a potent political force, including in the upcoming 2020 election.
An architect’s style and skill doesn’t always win the day when competing in overseas markets for services. Some trade policies are like scaffolding protecting local professionals, but some trade rules offer support beams that enable global talent to build the vibrant cityscapes of today and tomorrow.
Cambridge is a major hub in Massachusetts’ life sciences ecosystem. What makes up the DNA of vibrant biopharma and medical device industries? Trade associations, overseas governments and investors, and U.S. government agencies at the federal, state, and local levels are all part of the prescription for economic growth.
Technology has enabled us to tap into a global labor pool of remote workers anywhere in the world there’s a good Internet connection. 48 million workers registered their services on online outsourcing sites in 2013, according to the World Bank.
Well-known razor makers like Boston-based Gillette already face strong headwinds from changing consumer habits: fewer men are shaving as regularly now that beards are more in fashion. Online subscription services like Dollar Shave Club or Harry’s are also putting pressure on prices and profit margins. Now, razor makers are dealing with the problem of tariffs on the specialized steel they import.
A community’s store of “social capital” can determine how well it rebounds from adversity.
The biggest chunk of tariffs in the Great Tariff War of 2018 is between the United States and China, beginning with two rounds of tit-for-tat tariffs worth around $50 billion against one another. The United States just raised on the ante by another $200 billion. China will not fold; they will go “all in” in this poker game, but we don’t know what that means yet as they hold their cards close.
Whether you bought a multipack of screamers, bottle rockets, and roman candles from a roadside stand, or plan to watch a professionally-designed community display this Fourth of July, chances are the fireworks themselves were produced in China.
Every year, between two to four percent of workers in industrial economies are “displaced” from their jobs. Those most likely to lose their jobs – the very young, the very old, and the less educated – are also the workers least equipped to manage economic upheaval successfully. Even in resilient and growing economies, these workers often need a hand to get back on their feet.
By focusing on better preparing youth for employment in the knowledge economy, we can address long-term labor market shortfalls, improve lifetime earning potential, and contribute significantly to national productivity and global competitiveness. Where does it all begin? With teaching our kids to read well.