Chart of the Week: It’s not China’s fault!
Posted by: Brian Dennehy
A long time ago we said that China wasn’t stealing American jobs. The problem wasn’t China it was US productivity increasing.
In Chart 1 below (thanks to John Mauldin
for sending us the chart) you can see that the US is still making “stuff”, but as productivity is increasing the number of workers needed to produce those goods falls.
In our July 2017 edition of the TopFunds Guide we said that:
“Any job which relies on a process can be robotised…and as productivity is transformed in many industries, opportunities will not just persist but grow.”
Those surplus workers need to be re-trained otherwise unemployment will rise along with growing dissatisfaction not just in the US but the developed world as a whole. People will look for someone to blame and more extreme views will become more attractive, a pattern we’ve already seen play out across the developed world.
A trade war with China isn’t going to fix that problem. It needs investment in retraining those workers, not propping up crumbling industries.