‘EXPORTING’ HIGH-TECH JOBS: PART I

It’s hard to tell who does a more energetic St. Vitus’ dance when the “outsourcing” of high-tech jobs is mentioned: economic protectionists or free traders.

 

St. Vitus was the patron saint of those with nervous disorders. The dance dedicated by the afflicted to his martyred memory was, as you can imagine, somewhat disjointed. There is, however, a similarity in the mad twitching that the outsourcing topic engenders in the opposing factions.

 

Protectionists look only at the affected industry. They refuse to trace the counterproductive, even destructive, consequences to all consumers of government intervention to stop what has been controversially dubbed the “exportation of jobs.”

 

Most free traders, on the other hand, utterly deny that something is amiss. Others among their ranks quibble over economically correct terminology. Technically, it is indeed incorrect to speak about importing or exporting a job. Economist William Anderson corrects the mistake in the “Myth of Exporting Jobs,” pointing out that “a job is not a good,” but “a formal designation we give to action associated with the creation of goods.”

 

There is, however, a disconnect between academic theorizing about the market, and working it. When an American engineer is laid off, when the project he was working on is “cancelled,” and when, instead, a team based in China is hired by the same company to complete the identical endeavor – the man can be forgiven for calling the process “job exportation.”

 

Inasmuch as the wording dovetails with reality, it has validity, and shouldn’t be dismissed by scholastic pedants eager to ferret out proponents of the erroneous Marxist labor theory of value.

 

Still other free traders, myself among them, dare to depart from our colleagues and say that there’s a problem when innovation moves offshore. Free trade think tanks can rhapsodize over the glory of locating the manufacturing of TV sets to China. But TV sets have not been made in the United States since the 1970s. It’s semiconductors now! The innards of your cell phones are the things being designed abroad.

 

When you consider that investment in the U.S. was spurred in part because of our immense capacity to innovate, this must give pause. More fundamentally, it is well worth pondering the changes to a society that is no longer as innovative.

 

Cato’s Daniel T. Griswold refuses to consider that what we are witnessing is very possibly “a shift in fundamentals.” This is just “the passing pain of recession,” he claims.

 

But the recession doesn’t fully explain the accelerated “exportation” of high-income jobs like design engineers. Neither do the reported productivity gains paint a full picture. We’re supposed to be doing more with less, and China is allegedly helping us – doing the low-end stuff, and freeing Americans to reach for the stars.

 

This paternalistic and romantic theory, however, is dated. China is not a technological backwater, performing only our low-skill jobs. Production and design facilities in China are modern. Careening down the Chinese educational pike are as many engineers as there are members in the American Institute of Electrical and Electronics Engineers (over 235,000). Like Indians, Chinese are also well represented in the academic literature of the applied sciences. This is no hinterland waiting to relieve us only of low-skill work.

 

If, moreover, productivity were the sole deciding factor in employment, then it would make sense to employ Americans in the high-tech endeavors now using Chinese workers. An American worker will generally still perform the task faster and better than his foreign equivalent. But the price of wages and the cost of living in China and India are so very low that a team of Chinese can be hired for the price of one American.

 

There’s no doubt that the best and the brightest Americans will remain employed in their fields of expertise in the United States. But if American engineers were being freed up to perform ever more fantastic feats, then the IEEE-USA would not be reporting that, while the unemployment rate for all workers has fallen slightly in the third quarter, it has continued to m
ove in the opposite direction for U.S. electrical and electronics engineers. Moreover, there has been a sharp decline in the demand for these professionals. The Bureau of Labor Statistics confirms the trend, reporting that 230,000 U.S. workers in 12 engineering and computer job classifications were unemployed in the second quarter.

 

Economist Arnold Kling of Tech Central Station sees no significance other than economic in the hemorrhaging of scientific and engineering talent to the restaurant, day care and private tutoring industries.

 

In addition to the above occupations, he recommends a string of other intellectually unchallenging work for “techies” – sex therapist (I’m not joking) and chef are among them. He also mentions that facility with (evidently very basic) statistics is an asset in this economy.

 

But Dr. Kling gets a fail on his multiple regression analysis. What unites all his job suggestions – the underlying variable, if you will – is their immovability: If you want to stay employed in the U.S., choose a job, preferably service oriented, that can’t be relocated. Got the aptitude to probe the field of fiber optics? Don’t. Instead, become a gym instructor to the multiplying population of menopausal gym-bunnies.

 

That’s what Kling is essentially advocating, and he is absolutely right, except that he is not concerned with the impact of the New Reality on the social and cultural landscape. At least he doesn’t deny that “a 30 mile-per-hour wind is taking jobs offshore to India or Russia.”

 

Like Kling, I too don’t doubt that jobs can be found. An engineer friend is doing carpenter work in the harbor. But here’s something to mull over: Professions that require the greatest degree of mathematical precocity like physics and engineering are usually dominated by men. Men, on average, are better at mathematical reasoning. What impact will a steep decline in the demand for applied scientists have on the position of men in a society already tending toward misandry?

 

Canada and England – both nations of shopkeepers – may have some answers.

 

©By ILANA MERCER
WorldNetDaily.com
December 12, 2003

CATEGORIES: China, Economy, Free Markets, Labor, Outsourcing, Technology