Last month, I wrote an article regarding manufacturing jobs and why they will continue to disappear despite the President Elects initiatives. Since the manufacturing sector has been hit so hard by automation and a fluctuating economy it begs the question, what comes next?
Economic trends show us that in the next 30 to 50 years, we will see the same effects across the fast food, retail, and possibly all service industries. Since the year 2000, there has been robust growth in these sectors quantified at 21.3% growth outpacing the median job growth of the private sector which presented a measly 5.3% over the same 16 year period.
With these numbers, all looks good, business is booming. Until we realize that this was the exact trend that characterized manufacturing jobs during the period of 1940 through 1950. Job growth weighed in around 17% and primary level jobs consisted of 30-40% of the economy. The situation today has the potential to be even more dire as the service industry constitutes 80% of jobs in the U.S market.
As technology and automation continue to grow we will learn that these service based jobs are not invincible. There is already anecdotal evidence of this starting to take place (See McDonald’s replacing workers with robots and automatic room service delivery in hotels)
The natural reaction to this would be, what can we do to stop this? Should the Senate pass a law protecting these sectors from such encroachment? Should we as consumers boycott the quick cash out line at Wal-Mart? While these ideas are noble, they unfortunately fail to recognize that these events are inevitable. As economic liberals and advocates of classicalism, we must recognize that a fundamental part of free markets is them correcting themselves. Often times the more we try to prevent the inevitable, the more the hangover hurts (one doesn’t need to look farther than the Great Recession to see this)
What Can We Do?
So in essence, we must shift our thinking from how can we stop this transition to how can we adequately prepare for such economic disruptions. The answer to this issue cannot be stressed enough and our workforce understanding it is paramount in the quest for a more stable economy. We need to focus on education and preparing the workforce with transferable skills. We have to prepare the workforce for the future; after all, challenges and job decline is inevitable, and it is our job to accurately prepare for it.