President Trump promises to bring back good jobs, old fashioned jobs, a pitch that may have won him the election in rust-belt states. His answers are easy and compelling, and hence popular. Stop sending jobs overseas, no more foreign workers, end burdensome regulations. and things will be the way they were years ago. Simple.
Too bad it’s the wrong diagnosis of the problem.
The reality is, these jobs are being lost instead because of domestic technology, creating a lot fewer jobs but vastly increased productivity.
This shift was highlighted in a recent New York Times article on work in the oil fields, one of the prime industries Trump hopes to rejuvenate with decreased regulation and a check on immigration, opening up a flood of new work. Too bad, as the Times piece points out, the loss of jobs results, not from restrictive laws or foreign workers, but from the fruits of Bill Gates.
It opens with a case study, Eustasio Velazquez, a long time oil worker in this country. At first he was laid off when his company adopted “powerful computer hardware and software replaced cables with wireless data collection.” He got another spot, then was replaced with “cheaper, more reliable rigs.” His conclusion, ““I don’t see a future….Pretty soon every rig will have one worker and a robot.”
Mr. Velazquez may not be an economist specializing in employment trends, but his prediction is incredibly accurate. The article details: “Indeed, computers now direct drill bits that were once directed manually. The wireless technology taking hold across the oil patch allows a handful of geoscientists and engineers to monitor the drilling and completion of multiple wells at a time — onshore or miles out to sea — and supervise immediate fixes when something goes wrong, all without leaving their desks.”
The bottom line for American workers in oil is simply this. Pioneer Natural Resources, a leading West Texas producer, last year added an incredible 240 wells to its inventory, and yet did not add a single new employee. Joey Hall, vice-president for operations, explained how his company was adopting computer streamlined operations on a large scale, that his goal was, “to transform our work force to the point where we need to hire fewer people….”
Donald Trump is absolutely accurate that developing jobs is a major challenge for this country today, for its political and economic leaders, for its natural and social scientists. But his answer is being made obsolete, not by of a lack of faith in American as opposed to foreign workers, or a new spate of green regulations, but because of the same forces that give us an improved smartphone each year. One possible move would be to boost construction jobs in new energy, a field where technology, ironically, can create traditional jobs.
Trump’s emphasis on jobs is dead-on right, and captures a national crisis. Unfortunately his analysis and solutions are just as dead-on wrong.