GDP and shipping jobs overseas thought

[Kuan]

This morning's news that the nation's GDP grew 4.4% got me thinking.

Suppose you buy a kite from a local kitesmith for $0.50. You sell it for $1.00. You add $1.50 to the nation's GDP. Suppose you buy the kite from China at $0.10 and sell it for $0.90. You've added $$0.90 to the nation's GDP. Since GDP is the holy measure of the nation's economy, shouldn't we just keep making kites in the USA for $0.50 each?

Comments and analysis welcome. No bashing please.

[Zeitgeist]

>Columbine killers purchase bullets at K-Mart--GDP goes up.

>Mortuaries get 15 new customers--GDP goes up.

>School district hires a team of grief counselors--GDP goes up.

>Hordes of media descend on small community in Colorada,
requiring food, lodging, and accomodations--GDP goes up.

GDP really is a rather silly measurement index.

I prefer this: http://www.rprogress.org/projects/gpi/

[Kuan]

Well what kinda got me going was all I was hearing was GDP this, GDP that. I too, don't think that GDP is the be all end all of all economic indicators. I don't think it tells us anything except for what we spent withint our boundaries. The only thing it's good for is telling us we're in a recession... and then again, it's "recession."

[Botnst]

Using a single derived number to describe a multivariate, stochastic phenomenon is just silly.

B

[Botnst]

New Report Says Outsourcing Causes 9% of U.S. Layoffs

By REUTERS

Published: June 10, 2004
WASHINGTON, June 10 (Reuters) - The bulk of outsourced jobs never leave U.S. shores, the government said on Thursday in a new report suggesting concerns over American workers losing jobs to cheaper foreign labor may be exaggerated.

Nine percent of non-seasonal U.S. layoffs in the first quarter were due to outsourcing, but less than a third of the work was sent overseas, the U.S. Labor Department said in releasing new figures on mass layoffs and outsourcing.

"In more than seven out of 10 cases, the work activities were reassigned to places elsewhere in the U.S.," the Bureau of Labor Statistics said in its report on mass layoffs for the January-to-March period.

Organized labor, critical of the administration's record on jobs, has promised to make outsourcing an issue in this year's presidential election.

While the figures offer the first official measure of the impact of outsourcing on U.S. employment, they count only layoffs at companies where at least 50 people filed for unemployment insurance during a five-week period and the layoff lasted more than 30 days.

That restriction means the figures do not capture the impact outsourcing has had on small businesses.

In the first three months of the year, 4,633 U.S. workers were laid off because their jobs were moved to a foreign country, the BLS said. That represents less than 2 percent of the mass layoffs that totaled 239,361 during that period.

When seasonal and vacation-related mass layoffs are excluded, the proportion of workers who lost their jobs due to overseas outsourcing rises to about 2.5 out of 100.

Another 9,985 workers lost their jobs because the work moved to a different location within America, BLS said.

However, the report showed outsourcing had a huge impact on whether work sites were permanently shut-down or just temporarily closed. Fifty-one percent of mass layoffs caused by outsourcing were permanent closures of the work site, compared to just 17 percent of total layoffs.

A large proportion of mass layoffs in America are due to seasonal factors -- such as winter layoffs in agriculture or summer shut-downs at manufacturing plants -- and about two-thirds last less than a month.

[Botnst]

Originally posted by narwhal
I bought an entry level stunt kite from Kitty Hawk Kites, right at the base of Kill Devil Hills in Kitty Hawk, NC. I recall paying in the neighborhood of $35 for it back in 1990 or so. I still have and fly the kite. It is made of sail cloth, and was custom stitched there at KHK. Overall, I have been very satisfied with the purchase, even though I only bring her out about once a year.

Gawdalmighty!

It just goes to show no matter how esoteric a hypothetical example one offers, somewhere on the inetrnet there's an afficionado who will take note.

Kuan, did you think that anybody would know the actual value of individually manufacture, personalized kites?

I love the internet!

B

[Kuan]

Hey great! Even greater that he's owned it for 14 years!

I'd like to add that my American made products have offered me the most value for my money in the last 15 years or so. (even my ML which I so fondly curse)