Alan Blinder on U.S. competitiveness
Princeton economist Alan Blinder gave a talk on U.S. competitiveness this afternoon. His main point was that the offshoring of services to English-speaking countries with lower wages (India, mostly) is a much bigger deal than most academic economists allow. "The potential shift is massive--dwarfing anything we have seen in recent years. Not dwarfing the industrial revolution, though."
The shift in the U.S. labor force, Blinder said, will be away from services that can be performed remotely (and thus will done where wages are lower), and toward those that demand a personal touch. So instead of skilled workers making more money and low-skilled workers losing out, as has happened over the past few decades, the divide between winners and losers will be more complicated. Brain surgeons and child care workers will do fine; call-center workers and computer programmers won't.
And college professors? "I'd like to think university teaching would be degraded substantially by remote delivery," Blinder said. "But in my heart of hearts I'm not sure the next generation of American academics won't be replaced by lecturers in Bangalore."
I think this is correct, except that I think even the brain surgeons, can be done remotely. And while there would still be some local presence in child care, there could be a greatly reduced one. Which leaves the open question. Why get a good eductation if the job market does not reward you? I have yet to see any one say any thing other be innovative. How does one quantify that monetarily? And how does one explain that the majority of really big inventions were created more than 20 years ago and we now tend to modify and improve those inventions?
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