Interesting article. I don't know if anyone else has noticed it or not but this is all the better reasoning for mo'better education. It is going to be tough on these "wanna be" hit hop stars and rednecks of today that don't think getting a good education or some type of formal vocational training is the way to go. It is going to be tough on them when they are my age.

http://biz.yahoo.com/ap/060101/chasing_prosperity.html?.v=4

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Jim

I'm actually enlarging.

It's pretty much the story around here, I know a formerly well to do GM plant construction engineer that's managing a day care center. Get that degree or get used to wearing paper hats and working the fryers.

The plus side is the communities with good workforces are going to be rewarded with new plants and jobs. Lansing has the best GM workforce in the country and when the new plants are completed they will be hiring, although I doubt GM is going to bring back those cushy $100k jobs anytime soon. The UAW is cutting it's own throat in a sense because when a person hires into GM and finishes the 90 probation period they get paid the same as the guy who has been on the line for 20 years....in other words there is no pay tier.

OTOH, many cities cut their own throat by continuing to offer incentives to the auto industry in lieu of searching for other industries. Grand Rapids used to be the furniture capital but it has emerged into the insurance sector and the result is high rise buildings and a booming economy.

Bot, that's your lower middle.

FWIW, in my office, we seem to have an inordinate number of post graduates. Out of 17, there are at least five with their MS, three of which are entry-level employees. I have a feeling that, even getting the first degree, I would be hard pressed to land the job I have in this day.

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Never a dull moment at Berry Hill Farm.

Undoubtedly.

One result of heavy manufacturing leaving the USA is that lower-level management also leaves the USA? This may attenuate the job market in entry-level, professional careers. Also, the population of the USA is still ballooning so there are going to be more degree'd job seekers.

If I have 10-20 qualified apps for a job (usually about what I get for entry-level professional position) I'm going for the better educated ones at the same price.

B

I can remember early in Clinton's presidency when Robert Reich was Secretary of Labor and the problems of manufacturing jobs moving oversees were becoming evident. Reich started talking about the 'knowledge' economy and the fact that since all good paying manufacturing jobs were a thing of the past, all workers in the US would have to have college degrees. In essence they were claiming that the US was becoming the managerial class for the world. They put lots of money and emphasis on community colleges.
It's a pipe dream. There will always be a significant portion of any nation's population which for good and bad reasons will not go to college. Those people deserve a decent life. Even if a the percentages of college graduates go up, as B points out, were just upping the ante. We'll be increasing the education levels of the un/underemployed and probably greatly increasing resentment in the process as the wealth of the upper class increases by exploiting third world labor and the wages of the working classes move downward to be on a par with the third world.

See 'Marx's Revenge'.

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1977 300d 70k--sold 08
1985 300TD 185k+
1984 307d 126k--sold 8/03
1985 409d 65k--sold 06
1984 300SD 315k--daughter's car
1979 300SD 122k--sold 2/11
1999 Fuso FG Expedition Camper
1993 GMC Sierra 6.5 TD 4x4
1982 Bluebird Wanderlodge CAT 3208--Sold 2/13

Very good Yahoo article. Long read but gets you thinking and makes you want to go to school. This article probably relates more to you old guys on this forum (anybody over 35 )

By: Charles Wheelan, Ph.D.


http://finance.yahoo.com/columnist/article/economist/1332

I'm not often moved by numbers, in part because of several tragic math experiences in high school, but also because statistics and equations can often obscure the more interesting big ideas. But I recently stumbled across a number that is the big idea when it comes to the 21st Century American economy.

Answer this: Between 1979 and 2002 (the latest year for which we have data), what happened to the median weekly earnings of American men without a high school degree? These are full-time workers, and the comparisons have been adjusted for inflation.

I'll give you some context. For college-educated men, the median weekly wage rose 20 percent in real purchasing power from 1979 to 2002. Women with college degrees did even better -- up 34 percent.

Now, back to the guys who dropped out of high school. What's happened to their typical paycheck over the past two and a half decades?

1. Up 10 percent -- only half what the college grads enjoyed, but, as my dad would say, still better than a sharp stick in the eye.
2. Up one percent -- or basically flat, meaning that the typical male low-skilled worker has not seen any improvement in his standard of living in two and half decades.
3. Down nine percent -- a standard of living almost 10 percent worse than a generation ago.
4. Down 27 percent -- meaning that over a 23-year period of relatively robust economic growth, low-skilled workers have seen more than a quarter of their purchasing power disappear and are now significantly worse off than they were in 1979.

The answer is d. Women who dropped out of high school did better, seeing their real wages fall only seven percent over the same period.

You Can Learn a Lot at the Movies

To understand the essence of what's going on, let me tell you about my night at the movies. I saw "Grizzly Man", a documentary by Werner Herzog about a guy who spends 13 summers in Alaska living among grizzly bears only to be eaten in the end by one of the animals he loved. That's not the relevant part of the evening, but it is an extraordinary film.

Here's the insight: As I parked my car in the garage, a mellifluous voice was saying repeatedly something along the lines of: "Please take your ticket with you. There is no attendant on duty. Pay for your parking at any of the kiosks inside."

I then bought my movie ticket at a different electronic kiosk (similar to the self check-in machines that most airlines are now using). Not only did the machine allow me to avoid waiting in line, but it also told me what percentage of the seats had been sold for every film at every time.

Both the automated parking and the automated ticket machine were new since the last time I'd been to that theater, no more than a few months ago. And that is why America's low-skilled workers are taking it on the chin. Forget the guy on the phone in Bangalore telling you how to use your new computer. He's a red herring. The job loss statistics tell the same story as they always have: Technology replaces far, far more low-skill jobs than foreign workers do. Think voice mail, ATM machines, automated customer service lines, self-serve gas, online bill paying, automated package tracking, and on and on.

Not one of those innovations is bad for the U.S. economy. Every one of them creates jobs -- albeit for people with skills in business strategy, engineering, software, marketing, and sales. And every one displaces people, like the guy who takes your $10 and gives you a movie ticket and $.50.

Want to Protect Your Job? Develop Your Skills

The 21st Century economy is not about jobs; it's about skills. After all, highly-educated people lose their jobs, too. What do you think happens when JP Morgan Chase merges with Bank One? Bruce Springsteen doesn't sing about those people because they are adaptable enough to turn around and do something else. At the time this column was written, the unemployment rate for college-educated workers was 2.1 percent, compared to 4.9 percent for the nation as a whole and 7.6 percent for workers with less than a high school diploma.

So what do we do for the people Bruce Springsteen does sing about? I'll be the first to tell you that the research on everything from job training to systemic school reform is relatively discouraging. Then again, so were the early attempts to put a man on the moon. The most important first step is to create the political will for massively upgrading the skills of those at the shallow end of the labor pool. Thinkers across the political spectrum have some clever and original ideas, but they need help getting past the baggage of their respective parties.

The Republicans need to ditch the absurd notion that tax cuts alone will help those at the bottom. The numbers are pretty darn clear: After 25 years of significant tax cuts and a steadily growing economy, there's not a lot trickling down to low-skilled workers that wasn't excreted by birds. Hence the Ukrainian proverb: A rising tide is good for those in big boats and bad for those standing on the bottom in heavy shoes. (Okay, that's not really a Ukrainian proverb, but doesn't it sound like it should be?)

The Democrats need to stop confusing things that lessen the pain in the short run with real solutions for the long run. Raising the minimum wage, for example, doesn't make anyone more skilled. It just charges more for the same increasingly outdated skills, which can be counterproductive. How? Just imagine that you own a movie theater and the minimum wage goes to $9 an hour. Would you be more or less likely to invest in automated ticket kiosks?

And, of course, there is some profoundly irrational individual behavior going on. Dropping out of high school is financial suicide. We can argue over whether it is a personal failure, a social problem, or some combination of the two, but let's agree on the key point: It's bad. Even finishing high school and skipping college is looking increasingly foolish. The median weekly wage for men with high school diplomas but no college fell 13 percent between 1979 and 2003.

The overriding lesson is simple: If your job can be done by a machine, then it soon will be. So try to be the guy who sells the machine.

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Audi TT

"The overriding lesson is simple: If your job can be done by a machine, then it soon will be. So try to be the guy who sells the machine."

Notice the guy misses a fundamental point. He talks about being replaced by a machine and selling machings but nothing about building machines.
Movie clerks and gas station attendants (the job losses he discusses) were never good paying jobs. The good paying jobs were in building machines or the components of machines (cars, steel etc). Some of these jobs have been replaced by machines but many have simply been exported. You can't export service jobs but you can export manufacturing jobs.
The point is very important because the reasons jobs are exported has a little to do with technology but mostly to do with sociology (capitalists, workers, and labor markets, multinational corporations, nation/states etc).
Despite his misunderstanding, he does have some interesting advice. "Join the upper classes as quickly as possible because the working class is being royally screwed in the US and there's no hope for change in the forseeable future."

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1977 300d 70k--sold 08
1985 300TD 185k+
1984 307d 126k--sold 8/03
1985 409d 65k--sold 06
1984 300SD 315k--daughter's car
1979 300SD 122k--sold 2/11
1999 Fuso FG Expedition Camper
1993 GMC Sierra 6.5 TD 4x4
1982 Bluebird Wanderlodge CAT 3208--Sold 2/13

The article is not about the upper middle class shrinking.

It is about the shrinking LOW SKILL upper-middle class way-of-life.

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Paul S.

2001 E430, Bourdeaux Red, Oyster interior.
79,200 miles.

1973 280SE 4.5, 170,000 miles. 568 Signal Red, Black MB Tex. "The Red Baron".

you're not that classy

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72 W114/M130

RedMeat cartoon

those steelworkers and so on were overpaidanyway.

$100K.

thats a lot of money for not having any real skills besides what they taught you at work.

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'O=00=O'
bmw 2002.
long live the legend

I thought capitalism functioned with a labor market. If so, how could anyone be overpaid?

What about profits to stock owners? Is the skill level there any different than the skill level of a steelworker?

__________________
1977 300d 70k--sold 08
1985 300TD 185k+
1984 307d 126k--sold 8/03
1985 409d 65k--sold 06
1984 300SD 315k--daughter's car
1979 300SD 122k--sold 2/11
1999 Fuso FG Expedition Camper
1993 GMC Sierra 6.5 TD 4x4
1982 Bluebird Wanderlodge CAT 3208--Sold 2/13

It's easy to determine when a price is too high--when an equal or better product comes along at a better price.

So if we have a steel worker in the USA getting X and a steel worker in Japan or S Korea getting X/n, then the steel worker in the USA has a job problem. The reaction by politicians is the usually stupid price-fixing remedy, in which tariffs are set artificially high. This accomplishes a thoroughly predictable response...nothing good for our side. The local labor market is under no incentive to reduce cost nor is the industry. In contrast, the competition is under pressure to make even more cost-savings so that the product will still be competitive in the protected market.

What is the outcome? See Pittsburg.

B

The wonders of capitalism. The dignity of life is determined by the market value of labor (except for those who have capital).

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1977 300d 70k--sold 08
1985 300TD 185k+
1984 307d 126k--sold 8/03
1985 409d 65k--sold 06
1984 300SD 315k--daughter's car
1979 300SD 122k--sold 2/11
1999 Fuso FG Expedition Camper
1993 GMC Sierra 6.5 TD 4x4
1982 Bluebird Wanderlodge CAT 3208--Sold 2/13

Yeah it sucks. Nonetheless, it is more successful than all the others that have been tried. Success is generally conceded to be better than failure.

Bot