John Florez: Job growth, economy link broken

Published: Saturday, Jan. 18 2014 9:24 p.m. MST

The old belief that a good economy “lifts all boats” and creates more jobs has been proven wrong. The link between a growing economy and job growth has been broken, according to MIT professors Erik Brynjolfsson and Andrew McAfee.

Rick Bowmer, Associated Press

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Let’s stop blaming the unemployed for taking unemployment insurance. And stop demeaning them by saying they are happy to “feed at the public trough” by taking a public subsidy, when lawmakers are eager to subsidize business. Just imagine a 55-year-old worker who has long been unemployed trying to survive in today’s economy.

Political leaders keep working to attract new businesses with subsidies or tax schemes as part of an economic plan. They support building convention venues, saying they improve a state’s economy and attract national business. They say business will create more jobs and seem to operate on the old saying, “a rising tide lifts all boats.” They hold economic summits and many assume jobs will follow, yet give little attention on policies that create jobs for the digital economy.

Our world has changed and the old belief that a good economy “lifts all boats” and creates more jobs has been proven wrong. We now have more productivity and stagnant job growth. The link between a growing economy and job growth has been broken, according to MIT professors Erik Brynjolfsson and Andrew McAfee's book, “Race Against The Machine: How the Digital Revolution is Accelerating Innovation, Driving Productivity, and Irreversibly Transforming Employment and the Economy."

Americans are hurting. We are more divided, more polarized, and where 1 percent are doing very well, 99 percent are not. Having 1 in 7 Americans on food stamps challenges our values about who we say we are as a people.

Change has left many apprehensive, fearful and looking for answers about their future and trying to place blame on something or someone. Some experts believe the problems with our economy are cyclic stagnation and eventually the economy will recover. This digital economy grows exponentially as productivity increases, but with fewer jobs. Employers buy more machines and hire fewer people. The problem isn’t that we have people who don’t want to work; it’s that many of the jobs people did are now done by computers and machines, such as clerks, bank tellers, vending machines and some medical and legal tasks.

We should all take a deep breath and realize that digital technology, like some past technologies such as electricity, the printing press and the steam engine, has disrupted our lives and our institutions. And while technology grows exponentially, people and institutions lag behind. Sociologists call it cultural lag. In past periods of social disruption, Americans were able to adjust and grow from change by maintaining our common values of perseverance, empathy and helping each other. However, with the digital revolution, those values are being challenged.

Jobs of the digital economy call for skills that can interface with computers and machines, the ability to imagine, innovate, create, work in groups, communicate and promote entrepreneurship. Economic development efforts ought to see job creation as a central outcome and pass specific policies that promote job growth, such as tax reduction for creating jobs and tax credits on unemployment insurance for hiring the unemployed. Our schools must be restructured so they can teach the skills required for the digital economy.

Let’s stop demeaning and blaming the unemployed. The MIT professors have raised the hard questions: How are we going to distribute the benefits of this abundant economy; and the harder question, what is a meaningful life going to look like? Where will dignity and self-worth come from in the 21st century if not from a job?

Utah native John Florez served on the U.S. Senate Labor Committee, as Utah industrial commissioner and filled White House appointments, including deputy assistant secretary of labor and on the Commission on Hispanic Education. Email: jdflorez@comcast

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