Dean Baker's Blog, page 135

Actually Middle Skills Jobs Are Not Disappearing

In their NYT piece on the possibilities for people switching jobs in mid-career, Clair Cain Miller and Quoctrung Bui link to a piece by M.I.T. economist David Autor to support the assertion that extensive research shows middle skills jobs are disappearing. Actually, more careful research showed the opposite. In the last decade, both middle and high skills jobs (using Autor's definition) were declining as a share of total employment. Only the least skilled jobs had an increasing share.

It is a...

Can Amazon Be a Record Breaking Wealth Destroyer?

The NYT had a piece touting the recent run up in Amazon's stock which briefly made Jeff Bezos the world's richest person. It then turns to Hendrik Bessembinder, a finance professor at Arizona State University, who describes the company as "one of the greatest wealth creators since 1926."

This designation as a "wealth creator" is based on its market capitalization of almost $500 billion. While this is a huge amount of money, it is not clear that Amazon's current or likely future profits justif...

Those Obamacare Insurance Subsidies Are About 0.2 Percent of Federal Spending

A Washington Post article discussed the future prospects for the Affordable Care Act now that the repeal efforts seem to have gone done to defeat. At one point the article referred to the cost-sharing subsidies in the program, which cover out of pocket expenses for moderate income households. It reports that these subsidies will "cost about $7 billion this year and $10 billion in 2018."

It would have been useful to put these numbers in a context that would be meaningful to readers....

The Job-Killing Robots Have Not Come to Japan

The NYT had an interesting piece on how Japanese workers are increasingly working well into their sixties, as a declining population has led to somewhat of a labor shortage. The piece rather bizarrely offers this as an explanation for why wages aren't rising, since it says that older workers are paid less.

That could be true, but it would imply serious discrimination, if older workers are paid less than younger workers with the same productivity. Alternatively, if older workers are paid less...

Patents Impede Innovation: The Case of Artificial Intelligence

The NYT had an interesting column making the case for publicly funded open research to speed the development of artificial intelligence. It's good to see some clear thinking about alternatives to research supported by government granted patent monopolies. Can we talk about prescription drugs now?

Amazon and Retail Jobs: More of the Which Way Is Up Problem in Economics

If the United States is to have more rapid economic growth, as most folks seem to want, then it needs more rapid productivity growth. Productivity growth is the key factor allowing rising living standards through time.

This is basically definitional. It means more output of goods and services per hour of work. It can allow us to have more stuff or work fewer hours and have the same stuff.

When we consider this simple logical point, it is bizarre that one of the attacks against Amazon is that...

Scott Walker Proposes to Spend $1 Million Per Foxconn Job

That's the arithmetic according to the Washington Post. The article told readers that Wisconsin governor Scott Walker claims he is giving $3 billion in economic incentives to the Taiwanese manufacturer Foxconn. The company, in turn, says that it will build a factory that will eventually employ 3,000 people. It would have been helpful to include the arithmetic so it was clear how much Scott Walker planned to spend for each job that Foxconn claims it will create. (Foxconn has not always followe...

Morning Edition Goes Trumpian in Referring to Republican ACA Repeal Efforts

Morning Edition host Rachel Martin introduced an interview with Tom Nickels, spokesperson for the American Hospital Association by referring to Republican efforts to "fix" the nation's health care system. This implies that the Republicans are trying to make the system better. This is certainly not obvious since all of their proposals are likely to take away insurance from tens of millions of people.

It shouldn't be too hard to use neutral terms, like "change" or simply refer to efforts to rep...

Donald Trump Is Confused: Ohio Has Been Losing Manufacturing Jobs Since He Took Office

At a speech in Youngstown Ohio last night, Donald Trump talked about the loss of manufacturing jobs in the state and told his audience:

"They’re all coming back. They’re all coming back. They’re coming back. Don’t move. Don’t sell your house."

Actually, they were coming back (at least some of them) before President Trump took office, but the state is again losing manufacturing jobs.

Manufacturing Employment in Ohio

Source: Bureau of Labor Statistics.

Employment in manufacturing in Ohio had...

The Productivity of Waiting in Line

Neil Irwin had an interesting Upshot piece highlighting a new paper by J.W. Mason arguing that slow productivity growth is in large part due to slow GDP growth. The basic argument is that if growth were faster, labor markets would be tighter, and companies would have more reason to invest in labor saving equipment.

While this argument strikes me as undoubtedly true, there is another aspect to productivity growth that is often missed. One thing that is even easier than replacing workers with e...