Creating jobs - before it's too late

I read an exceptional article this week.

Andy Grove, one of the most famous and successful businessmen of the post-war era (CEO of Intel for 18 years; Time magazine’s man of the year, too many awards to mention), penned a thought-provoking challenge to traditional globalization thinking. 

At the core of Grove’s malaise is that the much-referred-to engine of US jobs growth – the start-up company – does not in fact generate a broad range of technical jobs.

Some interesting points from the article:
-       There is a rough 1:10 law with US technology companies, meaning their China (manufacturing) workforces are about 10 times larger than their US employee base.  Apple has 25,000 in the US; 250,000 in China.  Similar numbers for Dell, Seagate Technology, etc.
-       The ability to export low-value jobs and retain the majority of the profits in-country may be true – but what about the long-term societal impact?  In his words: “…what kind of a society are we going to have if it consists of highly paid people doing high-value-added work -- and masses of unemployed?”

For me, Grove’s most unique point is regarding the connection between ‘low-value’ jobs and future industry innovation and domination.  He puts it far more eloquently than me: “…abandoning today’s “commodity” manufacturing can lock you out of tomorrow’s emerging industry. Our fundamental economic beliefs, which we have elevated from a conviction based on observation to an unquestioned truism, is that the free market is the best economic system -- the freer, the better. Our generation has seen the decisive victory of free-market principles over planned economies. So we stick with this belief, largely oblivious to emerging evidence that while free markets beat planned economies, there may be room for a modification that is even better.”

Remember - this isn’t in Socialist Worker’s Weekly, it’s the coverstory of a leading magazine, written by one of the sages of the modern business age.  A very well-written article, full of moments to make you pause. 

Full article here

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