Globalisation, Job Destruction and Adversity

Globalisation, Job Destruction, Adversity. Why would I link the three terms in the title of this post?

 

Globalisation

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I don’t consider myself particularly smart. However from an early age my father taught me to think independently. Not to follow public opinion unless there were sound reasons to do so. Suspect that there would often be a hidden agenda when “they” said this or that.

Perhaps I was fortunate to have spent my formative years in Rhodesia. We saw at first hand how the media could be used for propaganda.

Used to persuade otherwise sensible people in the West to adopt causes that were not in the interests of themselves, their countries or fairness.

It was bizarre that people in the UK, USA, Australia and Canada would allow their governments to sacrifice South Africans and Rhodesians. To abandon former allies from WWII, in favour of communist financed and armed terrorists.

That some of those same countries have now suffered heavily from terrorist action themselves is the supreme irony. Hypocrisy tends to have consequences. Not that I take any pleasure in noting it.

My experiences planted a seed of distrust for big government – particularly liberal governments. A seed that has been nurtured and encouraged to grow by actions of those same big governments – and other non-government organisations, over my lifetime.

One of my earlier misgivings, was the trumpeting of globalisation as the key to lifting living standards and the quality of life for residents in the developing world. At the same time improving employment opportunities and incomes for those in the developed countries.

It was easy to see how the elimination of barriers to free trade would create huge new markets for suppliers in the West. To see how it would allow access to new, cheaper sources of raw materials for manufacturers.

Globalisation pitfalls.

Why was I, an ordinary businessman in Africa, one of the few who thought that globalisation would also lead to a massive export of jobs from the developed world. To start a shift Eastwards in the balance of power. To suspect that without governments in those developing countries being held accountable, little benefit would trickle down to ordinary residents.

Sadly, particularly in Africa, that is the case. People in some countries are worse off by many standards including life expectancy, employment levels and average incomes. All well below those of 50 years earlier.

The labour union movement did start bleating about the danger of jobs moving overseas. This was more as a bargaining point to drive up wages than to slow the tide of globalisation. Increasing wages at home merely added to the rate at which manufacturing jobs moved offshore. Service jobs followed.

Now there is a growing complaint that the only people in the West to benefit substantially are the few at the top. High level corporate executives, shareholders of businesses that have ridden the globalisation wave most successfully.

And of course those same big governments themselves, more taxation revenue to pay more government workers, enable more legislation and more control over people’s lives.

I am not against wealth and profits, I believe in many cases there is too much red tape restricting efficient business operation. I certainly do not advocate more legislation. There will always be those who think wealthy and successful people are lucky, crooked or immoral. Instead of realising that the majority of successful people get that way through their own efforts of hard work and taking risks.

Consequences of globalisation

However, some of the consequences of globalisation enhanced by advances in technology, are now seen in the reduction of employment opportunities in the developed world.

In this article in The Washington Post author Lawrence H Summers forecasts that by 2050, a third of all men between the ages of 25 and 54 will be out of work and that half of all men in that group will not work one year out of five.

It will be the continuation of a trend that started in the 1970s – when globalisation was being touted as the saviour of mankind. It’s been affecting increasing numbers of mid range income earners for two generations.

The implications are more serious than most people realise. They will be disastrous for people without the skills or determination to generate income as entrepreneurs.

They will be equally damaging for those who do manage to find employment. The 33 1/3% of non-earners will expect to be supported through some form of welfare by those still earning an income.

Added to the costs of supporting aging populations the current system will collapse.

That’s the legacy of globalisation. Good for developed and developing countries alike in the short-term, ultimately bad for most.

How do you protect yourself from the adversity that will result?

Develop a marketable skill that will continue to be in demand as the consequences of globalisation and technological advances unravel.

Many of those marketable skills will be in low-tech activities that have been overshadowed but are starting to shine again.

Adversity always creates opportunities for those who can survive it and adapt to the consequences. The ones who seize those opportunities will survive and thrive.

What do you think? Leave a comment.

 

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