The Sucking Sound of (At Least Some) Skilled Workers Leaving the US

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Defenders of the Obama Administration’s indifference to high levels of unemployment often claim the problem isn’t readily remedied because the US suffers from “structural unemployment”. That’s really wonkese for blaming the victim. No sirreebob, the problem isn’t that there aren’t enough jobs, but that the workers are no damned good, as in they don’t have the right skills for our new super duper information based economy! In mainstream media outlets, claims like this are usually followed by a business owner saying there clearly aren’t enough skilled employees, he can’t hire any good machinists for $13 an hour. Generally speaking, Mr. Complaining Boss is offering below the going rate, but why let pesky details spoil a good narrative?

You don’t have to look hard to find evidence against this argument. Unemployment is high among new college grads, normally one of the most sought after types of job candidates. Unemployment is also high across pretty much all job categories; you’d expect to see pockets of strength if there was a skills mismatch. Revealingly, you’ll hear Obama administration types say we need more engineers, when engineers will tell you the pay is too low relative to the cost of getting educated these days (unless you decide to get a law degree too and become a patent lawyer). If engineers really were scare, you’d expect pay scales to reflect that fact. Both the Economic Policy Institute and CEPR have published more rigorous debunkings.

Earlier this year, Australia started looking to hire skilled workers from the US. From Newsmax:

Australia has made a plea for American plumbers, electricians and builders to move downunder to fill chronic shortages of skilled workers as the economy struggles to keep up with a resources boom fuelled by demand from China.

Industry projections from Australia’s employment department show Australia will need 1.3 million extra workers over the next five years, including almost 200,000 more workers for the construction sector.

Australia will also need around 320,000 more health care and social assistance workers.

Australia has been running immigration seminars in India and Europe to attract skilled workers, and will now target the United States for the first time, with a skills expo set for Houston in Texas on May 19 and 20.

These are the sort of “middle class jobs” that people like Gene Sperling of the National Economic Council say they want to create. At the same time, when I once saw Sperling speak about “middle class job”, it was hard not to see that he viewed the “middle class” as a remote, but important object of concern, as opposed to a group he was part of.

Although Australia is at risk of being pulled down by slowing growth in China (the indicators are mixed), Canada has also started looking for experienced workers, in its case, in the oil industry. From OilPrice:

Canada is predicting a doubling of oil production by the end of this decade. This means it will have to secure its workforce to the tune of tens of thousands of new laborers. So if you want a job in the energy sector, try your northern neighbor.

Since 2010 alone, Canadian officials say that some 35,000 US laborers have obtained permits to work in Canada, and there are plans in the works to make permits even easier to obtain. In the meantime, Canadian head hunters are stepping up their efforts at recruitment—taking advantage of the number of jobless in the US.

Oh, and these jobs tend to come along with an attractive salary, free healthcare, stability and bonuses.

In other words, America’s continuing push to treat workers as disposable puts US companies at a disadvantage relative to employers in economies where for legal and cultural reasons, employees are treated better than in US. Now admittedly, this trend is taking place only in certain job categories, but twenty years ago, you would have been laughed out of the room if you had suggested that laborers like electricians and plumbers would have a better financial future if they left the US. And with college costs skyrocketing, you can expect to see more American students get their degrees overseas and that will increase the odds that some of them will wind up working abroad. American exceptionalism allows America’s leaders to keep pretending we are number one and use that as an excuse for inaction, when the evidence on the ground calls that into question.

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  1. JGordon

    Australia is on the brink of going through it’s own housing bubble collapse right now. And then there is the fact that the Chinese economy is also going down the drain in a hurry. It’s really hard for me to understand why some people are still saying that things are “uncertain” when it’s patently obvious that things are going down the crapper in a hurry, but I suppose that’s just me.

    Oh yeah, I graduated from college and couldn’t find a decent job. But after being bummed out for a while I realized that being in the rat race is really a pointless pursuit anyhow; so now I am thankful that the elites are stealing everything that’s not nailed down and that the economy is collapsing; because if not I might have a 9 to 5 job pushing paperwork all day, having to listen to the bitchings and moanings of incompetent coworkers and bosses.

    For all those looking for a “good” job: just say no! I have suggestions for things you could be doing that are a lot more worthwhile and psychologically fulfulling.

    1. alex

      JGordon: For all those looking for a “good” job: just say no! I have suggestions for things you could be doing that are a lot more worthwhile and psychologically fulfulling.

      Sounds like fun, but I’ve got a couple of spoiled kids who want to be fed every single day! Sheesh. Isn’t nine old enough to earn your own living?

      1. ambrit

        Dear alex;
        Tell that nine year old ingrate of yours that Owen is hiring loom attendants over at New Lanark Mills! Tuppence a day, and only a 10.5 hour day at that! Plus free schooling! The nipper will be self supporting and literate too!

      2. JGordon

        If your dependent on a market economy economy that is collapsing, and security you and your kids of is an illusion anyway.

        After grauduating from colleged and realizing how fubared everything is, I learned how to more than get by on a minumum wage job, with plenty of money left over to spend on my ammo, rabbots and solar panels. As for putting food in your kid’s bellies: well, that’s part of how I’m getting by! Start studying permaculture principles and techniques now while you still have access to information.

        1. bluntobj

          This post is full of win!

          He’s absolutely right about permaculture, and the debilitating effect seeking a professional type job will be on life.

          Pastured poultry, natural pork, and building a farm are where I’m at myself.

          1. diptherio

            Re growing your own food: Probably a good solution for some, but not a solution for everyone. I think the fallacy of composition may apply here, but I could be wrong. At any rate, knowing how to feed yourself is probably a skill we should all cultivate…you know, just in case.

            I can empathize with JGordon, having myself earned a BA in Econ (with honors, beatch) but not having managed to find a “good” job. Fortunately for me I’m single, monk-ish, and I determined quite awhile ago that I prefer jobs that allow me to use my brain for what I want to use it for. Desk jobs required to much thought power, whereas manual labor allows me more time for intellectual pursuits. Like JG, I’ve learned to live comfortably on not much, and still have enough left over (occasionally) that I managed to fund a village school in Nepal (not bad for a house painter, huh? I’d like to see Bill Gates start a school on my wages). But I understand that not everyone is as fortunate as I. I honestly don’t know what I’d do if I had a kid to take care of.

            Regardless of how we are currently earning a living, though, or whether or not we learn how to garden/wildcraft/hunt for our food, I think the thing that will ultimately get us by in times of crisis, and that we should all be reinforcing as part of our personal and societal “security measures,” is human relationships.

            When the excrement really hits the oscillator, the strength of our relationships will be what makes the difference between survival and destruction, imho.

      3. Martin Javes

        Wait a minute … you made children in capitivity? If I had a million in silver, per each, to ensure they wouldn’t have to wage-slave like me, maybe I’d have some.

        Let me guess; the wife begged you, and you just wanted to make her happy with the sacrifice of a few little lives to the machine, right?

  2. Middle Seaman

    Way before Obama, managers and owners treated workers as expendable, replaceable and cheap resources. The only important resources are themselves. As a result, they developed a solid belief that minimum wage is the right compensation for all workers. Advanced, and successful, companies such as Microsoft, Google and Amazon don’t think that way. They demand a lot from workers but they pay them well.

    With the ascendancy of the arrogant class, i.e. Obama and like minded Democrats, we are all skill-less, useless and lowly paid pawns.

    1. charles 2

      “Advanced, and successful, companies such as Microsoft, Google and Amazon don’t think that way”

      You mean Microdoft Surface, Google bespoke server and Amazon warehouse are built/operated by Americans with full benefits ?

      Dream on…

    2. Michael

      As someone who has been working abroad for many years, I can attest to the presence of skilled workers seeking work outside of the US. A recent example, which rejoins many of the themes Yves covers in this blog: I came across a professional researcher-professor who found a role in a biology lab at a major university outside of the US with several advantages: more pay (surprisingly, such skills are relatively poorly paid in the US), more prestige plus she and her husband were able to walk away from a house that’s worth a lot less than their mortgage.

      1. alex

        “surprisingly, such skills are relatively poorly paid in the US”

        There’s nothing surprising about it. It’s the result of deliberate policy. In the 1980’s there was even a surprisingly frank internal report of the NSF that talked about greatly increasing the number of grad student visas in order to drive down researcher compensation.

          1. alex

            Thanks cb. Prof. Matloff is the goto guy on this issue. I had a more detailed (or at least verbose) post about Matloff somewhere below, but WordPress ate it.

    3. Up

      Don’t speak as though Microsoft,Amazon and Google are angels.
      They are not decended from heaven. No company is.

    4. Lord Koos

      “Advanced, and successful, companies such as Microsoft, Google and Amazon don’t think that way.”

      Then there is Apple…

      1. Lafayette

        Then there is Apple

        Yeah, right. You know the bite taken out of the Apple logo?

        That was the good part. Jobs took it with him …

  3. David

    Yes, I have been waiting for this to happen for a while. Teachers, particularly those qualified in maths, science or languages, may be the next occupation that is actively recruited.

  4. Sara K.

    I am one of those college graduates who, shortly after graduating college, left the United States. Right now, I’m not planning on making this a permanent move … but even though my salary is not fantastic, I do get excellent and affordable healthcare coverage, which means I’m in no hurry to return to the United States.

    1. Crazy Horse

      Just graduated from University? Facing a lifetime of debt slavery called a Student Loan? Don’t want to take a job in the Imperial Army, the employer of last resort for all Americans?

      Take the C Road: Canada, Colombia, Chile.

  5. Can't Help It

    Hm, not sure about this. Certain types of work will still only be available or directed from the United States for example Natural Language Analysis from the AI field. If you are looking for non academic work in that field, good luck finding it in Asia for example.

    In addition, other than Australia, where are all these “skilled” workers going to go?
    1. Europe. Last I heard there’s a recession there.
    2. Africa. I think you get paid more gunning down people.
    3. Asia. Never heard of a well paid electrician/plumber, etc here. Over here there’s a pretty much built in perception that only certain types of people are allowed to be rich: enterpreneurs (most of which got rich through corruption), bankers, lawyers, specialist doctors, and well connected managers (those who brown nose the boss the best).

    1. alex

      “Over here there’s a pretty much built in perception that only certain types of people are allowed to be rich: enterpreneurs (most of which got rich through corruption), bankers, lawyers, specialist doctors, and well connected managers (those who brown nose the boss the best).”

      Are you sure you’re not confusing it with the US?

      1. Can't Help It

        Well, at the very least, there are plenty of software/electrical engineers doing very well in the US. No doubt you will find one or two of those in Asia, but you can count those in one hand, and I can’t even name one :)

        And I’ve lived in the US before for quite a period of time (double digit number of years). It’s not the utopia the movies made it out to be, but I enjoyed it quite a bit. Family called me home, but part of my heart will always be in San Francisco (awwww sound special effect).

        1. alex

          As an American electrical engineer who has a decent paying job (though hardly rich), I don’t want to sound too “woe is me”. I’m sure I have a better standard of living than your average Chinese EE. Nevertheless, the mentality you describe is becoming more entrenched in the US, and I definitely don’t like it. I think it harms any country where it exists.

          1. Darwin

            Corporations would rather higher cheaper less competent Indians with no benefits and no job security than Americans. They bribe the politicians to allow more and more in.

          2. Can't Help It

            Oh I think what you are describing is true. I too started to feel it when I was leaving the US.

            Japan is a sort of a different beast, so it’s pretty common for banks/businessness etc to have an Asia Ex Japan business line. To be honest, what I know comes from friends and I think Japanese factory workers are paid the highest in Asia. Video game designers/programmers, anime producers, etc make either a lot of money or at least they make a very comfortable living. Construction workers etc also make decent money.

            The rest of Asia though ….

    2. Stephen Nightingale

      “Natural Language Analysis”? The bottom dropped out of that in 2003, along with the Tech Bubble burst and it never came back. The US switched Machine Translation focus to Arabic and Chinese, pretty much excluding anybody with European or Japanese language skills and experience. After a career in computer networking I went and funded 4 years of Postgrad education in “Natural Language Analysis”, followed by a Postdoc in Japan. I followed that with 18 months of unemployment, I have been back in computer networking the last 6 years.

      The opportunity cost of my 8 year adventure was about 1/2 million dollars. Though I did get 4 good years in Edinburgh and 3 good years in Kyoto, both more satisfying places to be than Washington.

    3. Lafayette

      Certain types of work will still only be available or directed from the United States for example Natural Language Analysis from the AI field.

      Dear me, what would we ever do without NLA?

      Fewer robots with which to vacuum the living room, cook supper, answer the phone, take out the garbage?

      Ugh! Life is soooo brutal …

  6. bmeisen

    Free healthcare? Exists only in voodoo cultures where you pay the witch dcctor in ganja. Maybe the pitch should be “affordable”.

    1. Lafayette

      No, free healthcare actually exists wholly in the UK

      And partially in France, where for ordinary services 30% of the mandate service price is reimbursed. Meaning I pay 7€ to see a GP. For any really costly items, like long-term illnesses such as cancer, the coverage is 100%.

      Nobody in France, at any age, need sell their house in order to pay for decent Health Care.

      Yep, its the kind of Healthcare that Americans can only dream about. Even with ObamaCare, which is just a palliative compared to other fully fledged national HC-systems in Europe.

    2. Francois T

      It should go without saying that no health care system is “free”. It’s a matter of who pays what, to whom, and according to which parameters. One can only wish that the dominant set of parameters would be evidence-based medicine, but stating this with a straight face is increasingly considered a heroic feat. Just look at the colossal snake oil debacle that the last decade of American psychiatry has been.

      That said, there is a long list of valid reasons why the US healthcare can’t be “free”, or at least decently priced now.

      Are you ready for this? Between 35 and 50% of ALL health care costs bring NO economic value NOR health value.

      Meaning that the health care industrial complex has become a gigantic rent extraction machine that will destroy the US economy within the next ten years if nothing drastic happen.

      Hence, things will have to change. The hordes of dimwitted rubes who foam at the mouth against Obamacare haven’t seen nothing yet.

      Check out how said change will unfold here. A hint: Pain is guaranteed, hands wringing and lobbying shall be ineffective this time.

  7. Magpie

    Does anyone remember Steinbeck’s “The Grapes of Wrath”?

    The Joads sold their stuff back in Oklahoma to move to California, because over there there were plenty jobs and people could just pick oranges for free. Once there, they found no work.

    Change the word California for Australia and it could be same thing.


    You’ll be given temporary residence visa (category 457). If you lose your job, you have 1 month to find another one, or you lose your visa and they kick you out.

    Asian workers and workers from non-English speaking background, because they hardly speak any English, often suffer the most: many are kept essentially incommunicado, are underpaid and are often deprived of their passports.

    Other foreigners are treated better, but not necessarily much better.

    Frankly, I don’t know who is promoting this, but to me, it sounds like a scam.

    Just have a look at the note below (from The Stars and Stripes):

    “Serving Down Under: Australia offers military jobs to US troops facing separation” By Seth Robson. May 8, 2012.


    I’m not saying don’t go, but think things well before taking that step.

    1. Jim Haygood

      ‘Australia has made a plea for American plumbers, electricians and builders to move downunder to fill chronic shortages of skilled workers as the economy struggles to keep up with a resources boom fueled by demand from China.’

      Yeah, the only lure they omitted is ‘estate agents’ to help flip A$2 million bungalows.

      This is how fiat-currency bubbles induce the economic miscalculation that Hayek wrote about, causing businesses (and in this case, skilled workers) to overestimate the durability of demand in a late-stage boom.

      Moving to Australia in 2012 to work in building-related trades will work out about as well as having moved to Las Vegas or Phoenix in 2007 to build houses.

      Caveat servus.

    2. zygmuntFRAUDbernier

      I had heard before that Melbourne was an IT
      hub in Oz.

      84 jobs found for: IT and Telecommunications Jobs matching “systems administrator” in Melbourne Metro

      today’s search.


    3. Yves Smith Post author

      You don’t get it. The companies are recruiting and if you read the post, they are going to the US to recruit through agents. Australia is actually good about giving people that a company wants to hire a visa. Pretty much all the people I knew who eventually became permanent residents/citizens were sponsored. On top of that, big companies like McKinsey, big multinationals, and the big law firms had gotten a certain # of positions for which they could simply transfer people over;

      And the post makes clear Australia (where businesses complained that the government wouldn’t allow enough immigrants to produce population growth, birthrates in Oz are low) is now allowing for larger #s of visas and an easier process in categories where they need more workers.

  8. Tyzão

    in Germany taxes are about the same, health care cost is a bit high, but I haven’t been sick in the 6/7 years since I moved here from the southeast US anyways — other social provisions are also very good, not to mention the fact that buses and trains are everywhere … in general you will get PAID in order to pursue a Masters or PhD, not to mention health is also included — the difference isn’t even close really, best move I ever made

  9. zygmuntFRAUDbernier

    Those charlatans who speak the mumbo-jumbo
    of “structural unemployment” and other
    medieval superstitious “ideas” deserve to
    be blasted with cogent arguments high-lighting
    their tenuous grasp on reality.

  10. FXB

    I’m an expat living in Germany (raised and educated mostly in the US), and while I would like to return home for family reasons, I would have to significantly reduce my family’s standard of living to do so — a pay cut of approximately 1/3, to begin with, compounded by the disappearance of benefits like, yes, universal health care. Recruiters in the States are very eager to talk to me, but once they outline their compensation packages, the feeling is far from mutual. At the moment, it’s possible for my wife to stay at home with our two children, but that would not be possible in the US — at least not based on the sorts of salaries I have been offered over the past six months.

    1. Tyzão

      we have three children and it’s almost exactly the same situation here, on top of the social benefits, the time value of money is simply much better in Germany

      1. rosewood

        Could you two expand a bit over this? For example, what field are you working in and how much do you pay for healthinsurance etc.

        1. FXB

          @Rosewood: I teach at a university in Bavaria. In addition to my salary, an annual bonus and the 29 days of annual vacation, my wife and I also receive about €360 per month in Kindergeld, i.e., state support for the kids. Everyone in Germany — rich, poor, immigrant — receives this “handout,” with the level of support rising from the third child onwards.

          In terms of health insurance, we pay about €450 per month, with health insurance in Germany, it should be noted, providing more coverage than health insurance in the states, e.g. a €10 fee (and no more) per quarter for visits, no fees for children’s prescriptions and caps on other out-of-pocket expenses. We have had two children here and it cost us (out of pocket, that is) nothing. After our first child was delivered and the midwife visited every day for a week, I kept waiting for the bill, but it never came. I was similarly shocked to hear the sort of expenses my sister in Atlanta had to bear just recently when she delivered her first.

          Life here is by no means perfect, and the natives will be happy to provide a long list of said faults, and I could as well, but having experienced life on both sides of the Atlantic, life is simply easier here. There is so much less to worry about. Yes, I am a tenured academic, but most workers have contracts that provide real long-term stability. Indeed, while Americans dream of making it big, Germans dream of stability, and the system they have devised certainly delivers it. It has begun to fray a bit at the edges — many college graduates, for example, have to slog through a series of unpaid or poorly paid internships before landing a secure position, and real wages have been stagnant for a decade –,but you don’t have to fear medical bills, nor do you stay up at night wondering about how to pay for college. Have I mentioned that college in all but two of Germany’s states are free, and in the other two states (Bavaria inluded) it costs just €500 per semester?

          1. Tyzão

            I’m in Berlin at the TU managing my own project as what you might call a Junior Research Leader. I’m trying to move to Junior Professor, and while the wage is a bit lower than West Germany or Bavaria for that matter, it’s not so bad. My contract is for three years, which gives me a clear understanding of what is expected of me and how long I am expected to do it. I don’t think there is anything such as a “right to work” law here, which was something that always stressed me to the bone when working for private engineering firms in Florida. My health insurance is about the same as above, and like the previous commenter we had our second and third daughters in Cologne and Berlin respectively, and it cost us nothing and both were excellent experiences. With out first the German doctors used some kind of herbal champagne cocktail and the women in the beds side by side seemed to experience their birthing pangs like clock-work. Our second was also very easy, with both the hospital wasn’t far at all from our home. We get the kindergeld and also for one year there is some elterngeld (I think this is what its called) which helps with the diapers, babyhood and some other basic necessities. My wife stays home and takes care of our kinds, and I focus on my work, and making sure we are all provided for on a daily basis. Grocery store is close, gym is also close, cost of living in Berlin is very reasonable and the city is beautiful. Lots of infrastructure, social services, culture etc…The thing that stumps me, is how I can be paying nearly the same prevailing tax rate in Germany as I was in Florida, and yet the services available to me are far in excess to anything previously experienced — and I’m not even a citizen!

        2. Lafayette

          As a good example, take the Healthcare system voted the best in a World Health Organization study in 2000 here. Note where the US was on that study … 37th.

          But that is due to the fact that a primary criteria of the study was access to healthcare, where the US was very poor. Maybe it’ll get better under universal ObamaCare?

          As for cost, the French system contributions to payment is met by both the employer and the employee as explained here. That article fails to include the fact, however, that more recent changes include that patients accept a 30% of fee non-reimbursement charge. But fees are very modest since they are mandated by the national health-insurance system.

          So, the answer to your question (in France) is this:
          *For GP-level services (including specialist diagnostics) it will cost you 30% of the mandated price.
          *Specialist services pricing, typically for surgery or psychiatric care, is considerably higher. But if co-proposed by both your GP and the specialist physician, then any surgical costs are assumed by the National Health Insurance (less the 30% non-reimbursable amount).
          *To recuperate that 30%, one obtains a private “mutualized” insurance that costs about 100/150€ a month for the entire family. So, if one expects such costs could exceed 1200€ per year, it is worth having the top-up mutual insurance.

          For the cost of German HC-insurance, see here.

  11. Tony

    One of the reasons I have heard for americans leaving for abroad is the ability to simply not pay their student loans. If the price of education keeps going up, the incentive to leave becomes even greater.

    1. Max424

      Haven’t heard that. Makes sense. Student debt carriers, skedaddle while you can!

      In general, that has been my advice to all young people for quite some time now ….


      The problem is, where do you run to. The neo-liberal contaminant is dominant everywhere.

      1. Tyzão

        We’ll considering you will get paid and have health insurance, why wouldn’t you want to improve your education, in other parts of the world — whereas in the US you just take on debt.

  12. LAS

    The difficulty is that 320,000 jobs are still far too few for all the under-employed we have here in the USA. Moreover, overseas jobs aren’t always offered in relatively safe countries like Australia and Germany. Jobs offered in countries with increased danger, less stability or less cultural parity, like Turkey, Mid-East, etc. have to be more carefully evaluated. (I sugggest that Turkey is a little dicey not on its own merit so much but its neighbor, Syria.)

    1. YouDon'tSay?

      We don’t call it a global economy for nothing. You can run, but you more than likely won’t find refuge, for long anyway. The corporate capitalist labor exploitation model is now ubiquitous.

  13. Michael Olenick

    The engineering degree rant is especially disingenuous because what they want are H1B’s, who are deported if they quit or are fired until they’re here long enough to obtain a green card (about seven years). This makes them essentially indentured servants; they have to make sure they keep their employer happy. Some company’s, including the largest tech company’s, pay the same but most pay less or much less than a non-H1B would demand, and they also want more severe living conditions.

    Whenever anybody brings this up there’s usually a lash-back about “racism,” because many H1B’s are from India. But the truth is the Indian H1B’s also can’t stand the system; they just can’t and won’t say so while they’re in the program for obvious reasons, and even after to protect those still in it.

    There’s an easy solution if what they really want are workers, rather than slaves: allow full job portability. If they restructured the program so that H1B’s had, say, 2-3 years to find a new job if they quit or were fired, and any US employer could hire them with minimal paperwork, it would level the playing field with American workers and be more fair to the immigrants.

    Opponents of the program in its current form aren’t against immigrants or immigration, and we’re definitely not against our Indian colleagues; we’re trying to help them when it’s politically difficult for them to speak out without retaliation. We are against indentured servitude designed to drive down wages and working conditions, and so are virtually all of the immigrants these companies demand but they can’t say so, at least to their bosses. Allow full job portability, including the right to have no job, and you’ll see political opposition disappear. You’ll also see demand for most H1B’s evaporate because they don’t want workers; they want slaves.

    1. Hypothetical_Taxpayer

      So true. Back in the early 2000s when I still cared about working in IT, we had to read thru are those “job postings” that listed every technology acronym in the software world as being the required skill set. Then the employer could show the H1B people they couldn’t fill the “position”.

      At that time saleries in India were $20K for a Phd, $10K for a senior developer, and $5k for a code monkey. (per year)

      US corps had no problem finding takers for a US position at a higher wage than India’s.

      Of course the jobs flowed the other way too. IBM, CSC, et all, set up shop in India and e-mailed the software specs there. What a whoring biz.

    2. BondsOfSteel

      This isn’t my experence at all. I was a software lead at a large software company, and had many employees with H1Bs. They were paid the same as the non-H1B employees. Visa status wasn’t something that people talk about much, so I doubt their co-workers even knew they had H1B visas.

      While many were from India or China, a lot were from places you wouldn’t expect like Canada or the UK. Most (especially the ones from India and China) were educated in US public universities supported by tax dollars.

      While most wanted to stay at the same job because they were also applying to become permanent residents, I know quite a few that have moved from one company to another. One of the Canadians who eventually wants to go home, has regularly switched between companys every 2-3 years.

      Oh, and when I hired engineers, I didn’t look for people that had H1Bs. I looked for people that could program well, were whip smart, and could work well in a team.

      1. BondsOfSteel

        I should also say… that I agree with you that the system is broken and needs to be fixed. These highly educated workers shouldn’t have to wait so long for residency… or even rely on limited H1Bs.

      2. gepay

        Have you checked the tuition rates for non-residents at US state Universities. They are definitely not taxpayer supported.
        Plus since 911 getting a green card is even harder than it ever was.

    3. rotter

      Im wondering why anyone would want to emigrate to the US anymore, much less under the conditions of indentured servitude of H1B..only the most desperate i guess.

        1. Tyzão

          not really, a lot of Portuguese folks are going to Brazil as well as Mozambique and maybe even Angola — you’d be surprised how liberating these places can be if you have a decent source of income — and there are lots of new businesses there

          Spanish is similar to the Lusophone situation as well as French I would say…

    4. ian

      ” Some company’s, including the largest tech company’s, pay the same but most pay less or much less than a non-H1B would demand,”

      This has not been my experience. Once hired, h1-b workers were treated the same as native workers. I do believe that their presence depresses wages for all engineers, but that is not the same as what you are claiming.

  14. 40act

    Yes Americans tend to get paid more and enjoy cheap beef.

    but subtract health care premiums (hooray for single-payers) and cost of car ownership and it’s pretty easy to live a life as good as or better than in America.

    ….as long as you can live without a car and the false freedom of choice by being in a HMO/PPO.

  15. PQS

    HA! If the skilled trades move away (many of my coworkers in the trades travel overseas already for vacations), the labor shortage will get even tighter in the US….which is great news for salaries, as we are already predicting shortages in 2013 and beyond in construction. So many people left the trades during the GEM that there aren’t enough people now to take on any big jobs that require a lot of hours to complete….maybe then someone in the Obama administration will seriously start talking about trade schools and actual working skills education instead of pushing everybody to go to college. Plumbers and electricians don’t need to go to college to make $50/hour (and that’s not even prevailing wage.) I get very tired of hearing about college as the answer to employment problems in the US…..but then I also know that if we ever did decide to do a big push into the trades, the blahs and the browns would be the first ones pushed into it….we’re too racist in this country, and too classist, for me to trust that vocational education would be used positively.

    1. ambrit

      Dear PQS;
      I’m assuming that you live in a “high wage” region of the country. Here “Way Down South” in the Heart of Dixie, 50 dollars an hour is an amazingly high wage for a skilled trades worker. I know people in both the plumbing and electric fields who are still searching for private sector jobs paying more than 20 dollars an hour. This, mind you, for Journeyman level skill sets. At the State level, I have personally seen wages offered of 12 dollars an hour, admittedly with some benefits, to do skilled work at a state sponsored university.
      One countervailing force acting here is the reliance on cheap Mexican and Central American skilled trades people. They exist, and once the language barrier is breached, do good work. Lots of them are itinerant, and undocumented. Talking to them, one gets the feeling that one is experiencing the latest wave of immigration into our “Melting Pot” of a country. That’s the real reason why Southern states are slowly implementing pseudo apprenticeship programs in the skilled trades area. Not to develop a truly educated workforce, but to erect barriers to the ‘outsiders.’ Yet, the economic class gleefully accepts the lower sector wages this stealth labour pool provides. What’s not to like? Plenty.
      Finally, the concept of education itself has come under ‘revision’ over the last generation. A great deal of what passes for college education is really a glorified apprenticeship program. With the added bonus of the worker being conned into paying for the training that directly benefits the employer. A lot of what the young people I work with, heavily college involved in this university town, describe as course work, I recognized as what my age group would call High School level work.
      Don’t despair. There is always a push back. Goin’ South and the Wobs give me hope.
      “Any last words?”
      “Don’t mourn, organize!”

      1. Klassy!

        It is true that we are expecting more and more specificity from our educational system. It is amazing how often I read some damn interview of a business leader decrying our educational system’s inability to meet the needs of business. And our press takes these statements at face value! They never question why said business cannot train their own damn workers– why the costs must be offloaded to the taxpayers or the individual. And god forbid they even question the morality of the idea that capital’s needs are the same as society’s needs.

      2. PQS

        Yes, I confess to being in the high wage (pretty heavily unionized) Pacific Northwest….

        I agree that wages in the South haven’t kept up at all with wages elsewhere, even allowing for the cheaper COL. We used to have a lot of immigrant pressure in construction up here, too, but except for the guys outside of Home Depot, I haven’t seen many immigrant-heavy crews lately – the downturn chased them out of the market, I suppose.

        My other gripe, as I mentioned, is that everyone in government and education seems to want to push everybody into college, as if this would solve our employment problems. This started under Clinton, if I recall, and Obama just keeps mouthing this as though skilled labor doesn’t exist. I suppose in his world it doesn’t.

        The problem isn’t a lack of skills. It’s a lack of wages, because the top keeps hoarding everything for themselves..
        I wonder how smart the geniuses of Wall STreet felt after the hurricane – spreadsheets and testesterone don’t turn the power back on.

        1. ambrit

          Dear PQS;
          Those “Geniuses” of Wall Street you mentioned have called in their internes and jetted off to Barbados for the duration of “The Emergency.” That’s what good managers do, delegate.
          I suspect that “Skilled Labour” to Obama means Drone Assassin remote controllers and Private Security Condottiere.
          As for your region; work hard to keep what you’ve got, even if it means seceding from the Union and joining up with Canada. (Drake and the Golden Hind expedition give you all a perfect rationale to claim Commonwealth status.)

    2. Walter Nandin

      After the foreign-nationals entered the field, wages for helpers went to min-wage plus 50-cents and down to $15 for a journeyman with 10 years experience; that was before the housing-bubble burst. Now you will find many flipping burgers. Unless you are the 1 in 100 who gets on with the Union / govt. contract, forget the trades, or meat packing, or any industrial, etc. Foreign-nationals can support their families at home on the $25 a week left after bills, so that is the new pay-scale. If we would enforce hiring laws like every other nation in the world, we would have plenty of high-paying jobs again.

  16. JCC

    The situation is definitely getting worse here in the States regarding IT work. Although there are constant cries about not being able to find qualified IT people, I’ve noticed the huge change in compensation in the last year or two, that pretty much self-sustain the crying.

    I have been getting get calls from various recruiters 2 to 3 times a week for the last year or so and most are invarable the same, contract jobs at $12.00 to $18.00 an hour, no holidays and zero benefits, requiring a 4 year degree and multiple, costly, certifications. They usually involve a costly move into a fairly large and high-priced city, paid for by me, of course.

    The high end, $18.00/hr, may seem like a pretty decent wage, but a single person facing Local, State, and Federal taxes, $1000/mnnth rent expenses, mandated Health Insurance and Education Loan expense is in a break-even position at best. Anythig less than the $18.00/hr and he/she faces assured bankruptcy, with no relief on the mandates (health and education).

    I’m one of the lucky ones, I have a decent job, good pay, and relatively decent benefits, so I get to laugh at them and hang up. I feel bad for kids coming out of college, and if I were one of them I’d be adding a foreign language to my technical bag of sills.

    The U.S. has been intentionally driving down labor costs while the Big Corporations have been crying the blues about inadequate skills and at the same time pushing automation into every facet of their business (including IT), and begging for increases in H1B people. The system is unsustainable and mass exodus by those able to leave will not surprise me in the least.

    1. Hypothetical_Taxpayer

      Anyone that wants to be a programmer for $18/hr should probably just shoot themselves in the head now and save themselves a lot of misery.

  17. Timothy Gawne

    The immigration policy that gave the United States people like Einstein, Fermi, and Szilard, was an exclusionary one. It limited overall immigration to very low levels, so that wages would not be driven down, and used our high standard of living to attract the best from around the world.

    Now the United States has moved to a new paradigm: Cheap Labor Uber Alles. We flood the labor market, driving down wages for skilled and unskilled labor alike. This means that, increasingly, the US will not be able to attract the next Einstein (Einsteins never move to places like Bangladesh). It does mean that the rich will have abundant cheap labor and make a lot of money. This is a deliberate paradigm shift.

    During Great Britain’s “Brain Drain” of top scientists to the United States, a British administrator was asked about this, and he replied that it didn’t matter how many British scientists went to the US, there are so many desperate people in places like Pakistan and India that they can be easily replaced. Why should the elite care?

    That is where the US is headed. People are disposable, they are effectively cattle, and it is of no concern if the best leave, because there are so many other warm bodies to replace them. It is a policy of making lots of easy money for the rich through ever cheaper labor, and ultimately ceding the cutting edge in science and technology. Our leaders know about all of this this, it is a deliberate result of specific policies.

    1. rps

      The new paradigm (cheap labor) is based upon an earlier version: The Southern slave plantation model. Human Labor is a highly-valued resource that ensures stability and reification of civilization. However, the corporate masters want it for free or as cheaply as possible. Thus,their motiviation to inculcate a worthless mentality within the population of “expendability and replaceability.”

      The cheap labor that seeks US employment is not because we are the land of plenty, but because our corporate military and operations have intentionally destroyed foreign economies (think NAFTA) forcing labor populations to seek a livelihood somewhere else. Thus the influx of “slave-wage labor” begging for a job. This in turn forces the US population wages downward.

      The WWII hijacking of the Einsteins of the world was the USA’s policy. Why?, We understood USA progress and superiority was dependent upon the acquisition of human intellect. Today, under the destructive influence of corporate profiteering; the USA has been lead down the road of might makes right. We are no longer a nation that perpetuates human intellect and progress. Instead, we are a nation of greed and consumption. Australia, Germany, Singapore, etc… amongst other countries understand progress is dependent upon the acquisition of intelligent human labor.

      Think JFK’s Rice Moon Speech: “….Despite the striking fact that most of the scientists that the world has ever known are alive and working today, despite the fact that this Nation¹s own scientific manpower is doubling every 12 years in a rate of growth more than three times that of our population as a whole, despite that, the vast stretches of the unknown and the unanswered and the unfinished still far outstrip our collective comprehension….

      If this capsule history of our progress teaches us anything, it is that man, in his quest for knowledge and progress, is determined and cannot be deterred. The exploration of space will go ahead, whether we join in it or not, and it is one of the great adventures of all time, and no nation which expects to be the leader of other nations can expect to stay behind in the race for space.

      Those who came before us made certain that this country rode the first waves of the industrial revolutions, the first waves of modern invention, and the first wave of nuclear power, and this generation does not intend to founder in the backwash of the coming age of space. We mean to be a part of it–we mean to lead it……We have vowed that we shall not see space filled with weapons of mass destruction, but with instruments of knowledge and understanding.

      Yet the vows of this Nation can only be fulfilled if we in this Nation are first, and, therefore, we intend to be first. In short, our leadership in science and in industry, our hopes for peace and security, our obligations to ourselves as well as others, all require us to make this effort, to solve these mysteries, to solve them for the good of all men, and to become the world’s leading space-faring nation.”

      How far we have fallen from a nation of intellect and promise to a nation of voracious corporate consumers……

  18. Tom

    Not enough skilled workers to be found in the US – it is and, has always been pure baloney.
    I see lots of folks who have narrowed their view as to what defines a skilled worker. Sure it takes skill to program – but so what? The programmer is tasked by a skilled individual to create a tool that the skilled person has determined would aid his work. The skilled person who needed a quick way to attach two boards together made his difficulty known and a nail was borne, to drive the nail- the hammer (which came first the hammer or the nail). Computer aided design and manufacture are tools designed to improve production and allow the craftsman, designer, engineer, to get his work done, unleash creativity, do computations to speed discovery. (the same improvement as using a hammer instead of a rock to hammer a nail).
    Computers and computer programs are tools just as a hammer is a tool.
    It is not hard to learn a tool – the skill is in using the tool in the proper context or toward what is to be produced. Computers are computational tools that store and distribute information…when not used in support of creating some underlying tangible wealth creation…they are just entertainment devices. All the programming and advancement is just making the tool more functional or more entertaining.
    Management and the upper ranks have failed to blame themselves for their own mess (I am not saying all have but, I have to say all, otherwise blame shifting will continue). Granted, they are protecting themselves but, in so doing, they are shifting the blame onto the structural economy/ LACK OF SKILL SETS instead of their own failure at retaining, training and opening up a creative chaos that leads to advancement within a corporation.
    Computers lend themselves, thru programming, to the creation of tools that are not fit for duty — managers want tools to see how they are maximizing value in order to justify their jobs – they are looking through a high powered magnifying glass at an elephants rump unable to comprehend what they are seeing – an elephant. The tool itself is blinding the company to the bigger picture.
    To say that their are not enough skilled people around is a lazy man’s excuse designed to disguise the incompetence and short shortsightedness that has permeated the mindset of many. I blame it directly on the finalization of our economy and the tools that have been developed, in the financial community; designed to skim the real economy of its wealth and, by so doing, it’s creativity. – The largest miss-allocations of capital the world has ever seen combined with the most risk adverse (fear-based) capital formation ever known, driven by the deprivation of laborers of labor at healthy levels of income. – yes – blame the worker, blame the dog for the fat-cat’s crap.
    No such thing as a lack of skills – the free market won’t allow it.

    Laborers knowing that science and invention have increased enormously the power of labor, cannot understand why they do not receive more of the increased product, and accuse capital of withholding it. The employer, finding it increasingly difficult to make both ends meet, accuses labor of shirking. Thus suspicion is aroused, distrust follows, and soon both are angry and struggling for mastery.
    It is not the man who gives employment to labor that does harm. The mischief comes from the man who does not give employment. Every factory, every store, every building, every bit of wealth in any shape requires labor in its creation. The more wealth created the more labor employed, the higher wages and lower prices.
    But while some men employ labor and produce wealth, others speculate in lands and resources required for production, and without employing labor or producing wealth they secure a large part of the wealth others produce. What they get without producing, labor and capital produce without getting. That is why labor and capital quarrel. But the quarrel should not be between labor and capital, but between the non-producing speculator on the one hand and labor and capital on the other.
    Co-operation between employer and employee will lead to more friendly relations and a better understanding, and will hasten the day when they will see that their interests are mutual. As long as they stand apart and permit the non-producing, non-employing exploiter to make each think the other is his enemy, the speculator will prey upon both.
    Co-operating friends, when they fully realize the source of their troubles will find at hand a simple and effective cure: The removal of taxes from industry, and the taxing of privilege and monopoly. Remove the heavy burdens of government from those who employ labor and produce wealth, and lay them upon those who enrich themselves without employing labor or producing wealth.

  19. Glen

    In the United States, innovation has become almost synonymous with economic competitiveness. Even more remarkable, we often hear that our economic salvation can only be through innovation. We hear that because of low Asian wages we must innovate because we cannot really compete in anything else. Inventive Americans will do the R&D and let the rest of the world, usually China, do the dull work of actually making things. Or we’ll do programming design but let the rest of the world, usually India, do low-level programming. This is a totally mistaken belief and one that, if accepted, will consign this nation to second- or third-class status.

    The latest offender to advance this line of thought is Thomas Friedman, who has prominently displayed this familiar and entirely incorrect line of thought in the New York Times. Unfortunately, this idea is one that is widely accepted without careful thought about either its truthfulness or its consequences.

    Truth and Consequences

    Cheap labor abroad is cited as the incurable handicap that explains why the United States cannot compete. But cheap labor doesn’t explain the fact that Japan and Germany, both high-wage countries, are successful in the automobile industry. Nor does it explain how semiconductors, a model of a high investment, low-labor content industry, are mainly made in Asia. The premise that the inescapable burden of competing against low wages means failure is simply not correct.

    Perhaps even more disturbing than the lack of truthfulness is the fact that we are not addressing the consequences of not competing. There are some inescapable truths about any economic good, be it a manufactured good or a service: (1) you either produce it in your own country, (2) you trade something you do produce for it, (3) you do without it, or (4) you import it and promise to pay later.

    We are moving steadily away from producing what we need in this country. We are also moving away from producing on a scale that enables us to trade for what we do need. Rather than do without, we are increasingly importing things with a promise to pay later. This cannot go on. When our trading partners, especially China, no longer want to loan us hundreds of billions of dollars a year to be paid later, we will have little productive capacity left and we will be a poor nation.

    Friedman is only the latest to assume that we can avoid this fate by emphasizing designs, ideas, and R&D and trading them for the items we need. This is an attractive idea; we often hear about innovation parks and university research centers and often their work is both exciting and good.

    But the chasm-sized flaw in this otherwise alluring proposition is scale. Balancing trade on ideas and R&D simply cannot be done. The most elementary analysis shows that the scale is entirely wrong. As one who spent many years as the head of research of a large corporation, I know how much R&D matters; I also know how small it is. Eight percent is a very large percent of revenue to spend on R&D. Even in manufacturing, which is relatively R&D intensive, 4 to 5 percent is typical. It is really wrong to think that you can scale up R&D to be big enough so we can trade it for the huge quantity of things we need but don’t make in this country.

    A Strange and Unworkable Strategy

    Ignoring the issue of scale, Tom Friedman goes on to quote authoritative Chinese sources who say that by the end of the decade China will be dominating global production of the whole range of power equipment. To Friedman’s approving eye this just means that China is going to make clean power technologies cheaper for itself and everyone else. Friedman says that Chinese experts believe it will all happen faster and more effectively if China and America work together with the United States specializing in energy research and innovation, at which, he asserts, China is still weak, while China will specialize in mass production.

    It is probably true that all this will happen faster with the specialization Friedman describes, but where will we be at the end of that process? China will be making power equipment cheaply, but the chasm is still there, so what will we have to trade for it? Power equipment will be cheap in China, but if we adopt this approach it may well be unaffordable in the United States.

    Meanwhile the Chinese wisely welcome our nascent innovations and turn them into products. They are building plants, making things manufacturable, and adding them to their growing GDP. Friedman’s article contains an excellent example of this. He describes a U.S. developer with a new approach to solar-thermal power, whose proposal to the U.S. government asking for small scale support was easily outbid by a Chinese offer that was far larger and was aimed at much larger scale plants.

    Specializing in R&D, but sending its fruits on to others is a strange and completely unworkable strategy for a nation.

    Other Issues

    Thinking of innovation as a standalone activity without production has other major flaws. First, our global corporations, understanding that innovation and production are in fact closely tied, are rapidly moving not only production but also R&D overseas. Intel’s CEO made this very clear when he said that the goal of Intel’s new plant in China is to support a transition from “manufactured in China” to “innovated in China”.

    In addition, the standalone innovation approach leaves most Americans entirely out. After all, only a very small portion of Americans are engaged in R&D. At a recent meeting I heard “The only thing that matters is innovative and passionate people.” These people do matter, but they are very far from being the only ones. This attitude misses the point that it was all our people, working in many different work settings, that made this country prosper. And all of them will all be needed in any viable future for our country.

    What We Must Do – The Role of Trade

    We need successful industries and we need to innovate within them to keep them thriving. However, when your trading partner is thinking about GDP rather than profit, and has adopted mercantilist tactics, subsidizing industries, and mispricing its currency, while loaning you the money to buy the underpriced goods, this may simply not be possible.

    The ability to compete in a world that is half-mercantilist, half-free is inescapably tied to effective trade policy. Our present policy is to beg. We ask countries like China to stop the subsidies and currency mispricings because they are creating a one-way flow of underpriced goods; goods that are destroying jobs on a large scale in many of the most productive sectors of our economy. But why should they stop? It’s working for them.

    We must move to balanced trade. With balanced trade every dollar of imports is matched by a dollar of exports of goods or services produced here in the U.S.A. We are fortunate that there are in fact ways to balance trade. One very attractive way is to adopt some version of Warren Buffet’s Import Certificates plan, which Buffet has described in a remarkably insightful Fortune article.

    We should act now to balance trade. We should not continue to beg while jobs disappear and our productive ability erodes.

    What We Must Do – Motivating our Companies

    Today our companies are motivated to take innovations abroad, produce there and import the goods into the United States. Increasingly we can expect services also to go overseas. We must produce here in the U.S.A., to employ the people of this country, and we must keep their activities effective by a steady stream of innovations in design and production. While other countries roll out a welcome mat of tax breaks and subsidies for our companies because their common sense tells them that their people being employed in productive work is the road to being a rich country, we provide no incentive for U.S. companies to produce here.

    We cannot continue to have our corporations, faithful only to the interests of their shareholders, engage in a one-way flow of jobs, technology, and innovation out of the country. We need to realize that with globalization the interests of our country and of our global corporations have diverged. We can realign the interests of corporations with those of our country by rewarding companies that are productive here. And that can be done in ways that are consistent with our history and with the limited capabilities of our government.


    Specializing in innovation is an attractive idea, but a misleading one; an idea that blinds us to what we really need to do.

    We need to do more than produce exciting new ideas; we must also be able to compete in large productive industries. This requires us to both balance trade and to motivate our corporations not only to innovate, but also to produce in this country. While this is hard to do, it can be done. Specializing in innovation, though often recommended, is in fact a delusion, an alluring path that in reality will lead us straight downhill.

  20. Jazzbuff

    I saw Eric Schmidt (Google CEO) speak the other night. He was spewing the same line about the lack of skilled workers and the need to expand the H1B program so he could hire all those “highly skilled” new graduates fro India. Silicon Valley is full of unemployed talent but it is better to hire indentured servants. For those unfamiliar with the H1B visa, the employer holds the visa and if they decide to fire the employee the employee must leave the country within a short period – 48 hours I believe. That is a powerful conrol mechanism. So the Microsofts, Googles, etc. get to hire these workers at below market rates and work them ungodly hours. That is a much better deal than hiring someone with experience at a living wage.

    1. Hypothetical_Taxpayer

      They’re also not allowed to solicite a job offer from another employer either, so your pay will always be what they offered you over the phone while you were still sitting in India. Hours may change tho, it’s salary.

  21. briansays

    know a young couple he a lawyer she a vet technician who went to new zealand

    little crime, a good environment and a healthcare system focus on care rather than enriching a private insurance cabal that has bought the government

    but one question
    where are those folks who make twinkies going?
    now that is skilled labor

  22. Gil Gamesh

    “Disposable” workers. Word has it that the House, with the support of the Obama administration, is crafting new legislation to improve the Taft-Hartley Act. Under the new law, employers will be able, with full impunity, to kill employees for cause, or pleasure. The new doctrine, called “Employment and Life at Will”, has been heralded as a powerful tool to increase the global competitiveness of US firms. “Additionally, this act should help lower the un-employment rate, and that’s good news for everybody, right?” said a senior White House official, who requested anonymity.

    Executives and managers would be exempted. “They are just too important, after all. How would a business run without leadership?” said the official.

    1. JTFaraday

      That only sounds crazy. We are well along in the process of creating a situation where those with no money and no “job” have no rights whatsoever.

      Only, as this discussion of visa holders demonstrates, having “a job” doesn’t grant someone civil and political rights either.

      I think there’s a lesson in there somewhere for all effectively stateless persons out there.

  23. lambert strether

    Since their own country doesn’t want them, they ought to leave. Maybe they can take some memory of the better aspects of the American that used to be and pass it on to others. I mean, the rule of law used to pretty important, voting, and so on.

    UPDATE Adding, the post and the thread are right out of Albert Hirschman’s Exit, Voice, and Loyalty, aren’t they?

  24. cb

    Norm Matloff investigates and writes about technology hiring and the H1B immigration program in the US. There is no shortage of workers trained in technology:

    Another book by scientist Jeff Schmidt contends, among other things, that many professional certification programs require the graduates to think incorrectly about labor and market relations, such that only the docile, compliant or deceptive make it through:

    Yves has mentioned here that consulting firms seek employees with high intelligence and low self esteem.

    1. JTFaraday

      From a review on Amazon:

      “(Disciplined Minds)manages to treat these grim subjects with good humor and, ultimately, with hope — as it concludes that those entering graduate or professional school *can* protect themselves against ideological indoctrination, using techniques borrowed from an Army manual on how to resist brainwashing by enemy captors!

      The analogy may seem a bit melodramatic — much more so, though, if you’ve never been in grad. school yourself.”

  25. J Sterling

    Why does Australia “need” 1.3 million more workers? I could have put “Australia” in quotes as well as “need”. This is a country of 22 million people, in a continent with poor soil. Are new assets going to appear? And will those new assets be distributed to the new people?

    I doubt it. What’s more likely is that an asset-owning, labor-employing, rent-collecting minority in Australia want (not need) more workers and tenants to keep the price of work down and the return on their assets up, and that they will not pass the profit on to the workers. They will pass on the externalities of adding to the population, though.

    1. Yves Smith Post author

      Australia has low birth rates. And it is as big as the continental US, although most of that is the outback and is extremely sparsely populated.

      Did you manage to miss that Oz has lots of commodities and has had the best growth of any advanced economy from 2000 onward?

      1. J Sterling

        But why does that translate into a “need” for workers, and why does “Australia” have it? I suggest that “need” should be “would like to get a good annual return on assets” and “Australia” should be “a small number of large asset owners”.

        Australia no more “needs” a growing supply of cheap labor than America does, or the Netherlands, or the planet as a whole.

  26. casino implosion

    Electricians and plumbers are not “laborers”. They are skilled tradesmen. It takes just as many years to master those trades as it does to master a white-collar profession.

  27. Irrational

    But then there is just the small matter that you remain taxable in the US forever (unique on this planet) and that US laws are now so draconian that most banks abroad refuse to offer you a bank account for fear of US sanctions.
    Filing is hideously complicated – beyond software and making the employment of a tax advisor a necessity and not knowing about the requirements to report bank accounts (a separate Treasury thing) does not exempt you from exceptionally high fines.
    Because of course any US citizen that lives abroad is a traitor and does so to evade taxes. By the way, I am not one myself, but happen to be married to one who remains outside the US because of me…

  28. rob

    People have always gone abroad to work.I don’t think that is really a problem.Good for them,if they find a decent wage and good experience.
    I also don’t see any real fundemental flaw in what should be the economic engine of the economy of the US.I see people wanting stuff,other people making it for them and a whole wheel which should be turning.The parsitic lethal flaw we have is the power structure.The people who have caused this concentration of wealth. They are the class warriors, and national boundries don’t confine them, they are useful in devising/implementing gaming strategies.
    In the US, consumer spending is the major force in the economy.These companies ought to have to work, to keep the privelige of doing business here. Let them run abroad… and use tariffs to make their products un competitive with those of business who chose to stay.Sort of like a good neighbor policy.We had real tarrifs in this country for 200 years, and we had international trade the whole time…protection of the american workforce,isn’t isolationism.
    I really hate the mantra of american workers falling short in some way, as the excuse/buzzword of where the jobs went.I just don’t see the cogs in the wheels of what makes an economy being all that sophisticated..obviously,technology and science and manufacturing, and the real knowledge based sectors are PART of an economy… but really, most everyone is doing things that have been done before..big deal…obviously, the rockstars of finance and politics and economics…are really, mostly good con men/women.they are like succesful circus carneys.It may be a good gig if you can get it… but just like the kids who can tell you the baseball stats on a box full of cards, they are just reproducing what is already in existance. and their record on “creating” is abysmal and self-serving.but at least they don’t have to work very hard for the rest of their lives… they should thank their lucky stars.The hardest working people get paid the least, the best paid people ususally work the least…which is what it is.. but I do hate the myth of a meritocracy…
    We need to get our own house in order.That requires facing the fact that our leadership is the problem. and our inability to compose a narrative that actually helps us as a whole.
    The problem US citizens are facing now, is that wages have not kept pace with everything else in the last 40 years.If that fact wasn’t true, we would not be in the dire straights we find ourselves today.
    This is not an accident, this was not “just something that happened”Everyone should check out the new movie”HEIST;who stole the american dream”.It follows the attack upon the middle/working class after 1971.Very neatly following a memo written by then ;future supreme ct justice lewis powell for the chamber of commerce.This was a free-market utopian treatise coordinating big business with finance and political power to deliver everything that is true today to the biggest multinational players.combining money,power,academia,the pulpit,politicians in a wholly concieved plan to destroy organized labor and consumer protections…..and we can all see how it is working out.this was the seed that got together people like the kochs,and coors,and others who created the heritage foundation and the cato institute and republican organizations and the DLC democratic legislative council.. and the like… this was the kernal those who were attempting to undo the “new deal” revolved around….They sought to enshrine that big money would control the law and politics.While films like these are great overviews, to not get lost in seeing the trees rather than being able to glimpse the forest….It is clearly not an attempt to explain everything and everyone by a simple generalization.That is what blogs like these are good for.. to get lost in the weeds of exactly how, we are getting screwed….every little detail every day….but they do show the general trend that these details and annecdotes do tell.cause they do tell us where we are going.obviously, these men behind the curtain have gotten what they wanted thus far.and nothing is standing in their way now… it ain’t we have to assume they are going to go for the final solution, and we musn’t get on board the train.

    1. Kokuanani

      Heist is a wonderful movie.

      I fear it’s long gone from theaters, but Google it and go to their web site. The $15 or $19 you’ll pay for the DVD is well worth it, and you can have a “viewing party” and/or pass it on to your friends.

      If you didn’t know about it before, it’s astounding to learn about the “Powell memo” and the decades-long efforts by corporations to “get what they want” via legislation, the courts, de-regulation, political contributions, “think tanks” [sic] etc. As noted, this is NOT an accident, but rather a carefully crafted plan, originating mainly in the U.S. Chamber of Commerce.

      In your Google search, also look for the “movie night” interview the Heist film makers did at FireDogLake. A really interesting conversation with them.

      Support this film, and educate yourself in the process.

  29. Matt

    All part of the GOP’s plan to finally solve the immigration problem – by making America such a crappy place to live that nobody wants to sneak in…

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