As the United States economy rebounds from the effects of the latest recession, many in the media are calling the recovery a jobless recovery, citing the growth of the gross domestic product coupled with a high unemployment rate. Both the media and politicians frequently suggest that the trend to move manufacturing operations and service jobs offshore is the culprit for our economic woes. As a result, legislators are attempting to stem the tide of offshoring and outsourcing through a system of protectionist policies that mandate the use of American goods and services or tax corporations that utilize offshore resources. Both the media and politicians are spending their time and energy on the wrong problem. According to some estimates, offshored jobs will only make up 2% of the jobs lost by 15 million Americans annually (Lael & Robert, 2004). If outsourcing and offshoring are not the cause of job loss, who or what is the real culprit? In short, the culprit is good-old-fashioned, American know-how.
Since before the creation of the Computing- Tabulating- Recording Company in 1911, the predecessor to IBM ("IBM Archives: 1900s,"), businesses in the United States have sought the means to improve business performance through the use of technology. From advanced robotics and computers on the factory floor to self-service kiosks at airports and grocery stores, automation has displaced far more United States workers than have migrated offshore (Collins & Ryan, 2007). Daniel Drezner, Associate Professor of Political Science at the University of Chicago also sees technology innovation as the root cause (2004):
There is no denying that the number of manufacturing jobs has fallen dramatically in recent years, but this has very little do with outsourcing and almost everything to do with technological innovation. As with agriculture a century ago, productivity gains have outstripped demand, so fewer and fewer workers are needed for manufacturing. (p. 27)
Former Secretary of Labor, Robert Reich described a tour taken at a U.S. factory, where the entire plant was run by two employees instructed more than 400 robots on the factory floor (Reich, 2009).
The capitalistic process of creative destruction, first described by Engels and Marx in The Communist Manifesto is alive and well as new industries consume the flesh of the old (Marx & Engels, 1974). For example, the newspaper business is a shadow of its former self because of Internet technologies. It would stand to reason that if millions of jobs and whole industries were destroyed via the relentless advance of technology throughout the last 30 years, then the total number of jobs in the United States would be shrinking. Yet, even given the current...