Is Globalisation good or bad?
Many people around the world are questioning whether globalisation is a good idea and some are proposing bringing supply chains back to their home countries. They sight the pandemic of 2020 and the shortage of PPE equipment as the reason. Their argument is that If each country had its own capability to manufacture these things, there would not have been a shortage of PPE and it would create jobs. Sounds a grande idea. But it’s not that straight forward and better global cooperatiom, rather than national and intra-country rivalry for PPE, might have been a better route.
Imagine if the whole world had acted together and calmly gave everyone a week to get home and then we all shut down together for two or three weeks. By working together better globally, not just would we have been able to stop the pandemic in it’s tracks but we would also have been able to throw global resources at it – doctors, nurses and PPE. Let’s take a look at what globalisation actually is.
The term ‘globalisation’ is thrown around quite a bit. But what is it and what does it mean to us? When we hear the word ‘globalisation’ some of us think about losing jobs to low wage countries. Jobs are a part of globalisation, but it’s far, far more than just that. Look around where you’re sitting right now. Start with your mobile. Where is it made? Who thought of it? Where was it designed? Its components, the minerals, come from different parts of the world. Various constituents were assembled in different places. Final assembly could have been in multiple places as well. And it could be sold anywhere in the world and bought by anyone. Your phone was made as efficiently and cheaply as possible using resources from around the world.
This is globalisation.
Tens, if not hundreds, of countries, companies and people were involved in producing your iPhone. From the US and the EU for design, to Mongolia and Africa for resources; and from Korea, Japan and Taiwan for glass and processors, to China for completion. All of them were working for your benefit, keeping costs down and quality up. Lots of people around the world were involved in the process of creating, producing, marketing and distributing your iPhone. It was a global effort.
This is globalisation. And you benefit from it every day.
It’s the shirt on your back at an affordable price, the shoes on your feet, your fridge, your car and PPE. It’s also your music, your films, your holidays, your colleagues, your friends and your family. We live in a global world, which has benefitted us all. Some more so than others, however living conditions for the developed and developing world are generally much, much better than they were seventy years ago. Life is awesome for many. We’re lucky compared to previous generations.
Back to jobs – that’s yesterday’s battle – although there never really was one. Globalisation isn’t taking jobs, machines are. US manufacturing output has been continually increasing at a strong pace, while employment in manufacturing has been steadily decreasing. The jobs’ landscape changed. The types of jobs in different countries simply changed. It’s gone on since the beginning of time, albeit at a slower pace. As low-level manufacturing jobs went to low wage countries or automation, new jobs were created in high wage countries . Often they were service jobs. We used to make things. Then, we switched to providing services. This was good for both types of country, for the person who got the new job in the ‘outsourced’ (low wage) country and for the person who lost their old job, if they found another sort of job in the high wage country.
However, those traditional manufacturing jobs are gone, and they aren’t coming back. In fact, while jobs keep moving to cheaper places they are also simultaneously becoming more automated. The whole world has the same problem: jobs will go to where that given task can be performed most efficiently – and we all benefit. The jobs battle is not about jobs going to other people. It’s about losing jobs to technology and automation. That’s the job killer – computing power plus automation plus artificial intelligence. Manufacturing as a share of GDP in the US and UK are both at their highest in decades – but with fewer workers. And now services are being automated.
Globalisation isn’t the problem, it benefits us all. It’s our society that’s ailing and needs rebooting.
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