

How a New Jobless Era Will Transform America - known
http://www.theatlantic.com/magazine/print/2010/03/how-a-new-jobless-era-will-transform-america/7919/

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ojbyrne
I'm old and generally pessimistic. But I've seen enough recessions to know
that when you've read the seventeenth article about the never-ending bottom
(as I did during the reagan era, during the early 90s when Germany and Japan
were going to destroy the US economy, and post dotcom collapse), I can't help
but think it's time that the pundits will all be contradicted on the upside.
Just like they were on the downside.

Nations that have demographics and immigration policies that promote
population growth are going to succeed comparatively over the next 20 years.
The US isn't at the top of the heap there, but its close.

~~~
gaius
_immigration policies that promote population growth_

It's more subtle than that, and to a certain extent it's zero-sum. Countries
compete to attract skilled immigrants, and there is a finite supply of
doctors, engineers etc willing to relocate per year. As we see in the UK there
is a much larger supply of people who simply shop around for the best welfare
then claim "asylum". The brutal truth is that it's in no country's best
interest to admit people who are unable or simply unwilling to contribute to
their economy.

~~~
marshallp
I find this 'welfare scrounger' outrage coming from britain laughable. Britain
has the least generous welfare system of any rich european country, yet you
get the most compaints from there.

~~~
gaius
It's because we're the most accomodating. Seriously, try speaking to the
Swedish or French government in anything other than the national language.
Only the UK will automatically hire a translator. Generous welfare is no use
if you can't claim it. That's the secret of most European countries.

Why do you think all those people _already_ in a safe country, France, are
trying to get from Sangatte to Dover? It's not "asylum" once you're already
safe!

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cpr
The thing that has always amazed/disgusted me is how our education system
trains people to be passive consumers, and to leave school "looking for a
job", as if jobs somehow grew on trees and would eventually fall when ripe.

Until people learn from the cradle that they're not owed a job by anyone, but
have to create value of some sort, either for someone else, or for themselves,
we'll have this same sad situation.

Someone "stuck at home" is in the perfect situation to start creating value
that other people are willing to pay for: mowing lawns, baking bread, making
furniture/simple machines in their home workshop, using whatever raw materials
and machinery their forebears have amassed and are freely available, but, most
of all, using their brains and their willpower.

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patio11
I wonder if there is a way to profitably exploit this?

Presumably bad news in the hiring market for new graduates is good news for
YC: when the alternative to YC is picking up the phone and having Google and
Microsoft getting into a bidding war over you, startups look insane, when the
alternative is being a "parasite single" (wonderfully evocative Japanese
English coinage for "lives with Mom and Dad"), having your ramen paid for for
a few months must look pretty attractive. Granted, the vast majority of people
capable of starting startups are probably much more employable than the
average college graduate or the average inner-city dropout.

Is there anything the rest of us can do? "10% discount on lifetime wages if
you hire during a recession" seems like it would matter if I were hiring, but
I'm not. Does anybody have any other clever ideas?

I've got one: I can't offer anybody full-time employment but if somebody could
vastly decrease the friction of employment I'd love to have employment
available as a service. Something like what the India/Philippines virtual
assistant companies perform, except with a more consistent level of quality.

Working for it wouldn't be the most fulfilling existence in the world, but it
would pay for rent, food, and loan payments while folks look for more
permanent opportunities, and the virtualized nature of it would make it more
conducive to that than e.g. trying to get a job in food services. Plus, unlike
your local On The Border, I'm not going to ask "So Joe, are you going to be
available in 3 months or will you be going back to school?" because I have no
particular need for Joe to be personally available in 3 months -- I don't have
to train Joe, so it doesn't matter to me if I'm working with a new Joe come
fall.

Currently I do a wee bit of this via freelancing, but freelancing requires
friction from me -- I need to find freelancers, supervise them, pay them, find
replacements when they flake out, file tax documents for them, etc etc. That's
a whole lot of grunt work for something which is supposed to save me from
doing the grunt work. I want the API to grunt work.

~~~
jmtame
that was my first reaction, but this article is extremely long. wishing there
was a "tl;dr;" section so i could figure out the conclusion in a sentence or
two. bookmarked it for now, will come back to it.

~~~
washingtondc
It's extremely long? Maybe I'm a bit older than most readers here (I'm 38),
but has the average readers attention span shrunk that much?

Nuance cannot always come in bite-sized chunks. BTW, I read the article (on a
plane - the print edition, no less) - it's worth the time.

~~~
rmorrison
What's this "print" you mention?

~~~
washingtondc
The Atlantic

It's a very good magazine.

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btilly
My view is that the article is on the optimistic side.

It accurately describes the best case. It admits that nobody knows how bad it
will be. But it fails to talk about known structural problems that we still
face.

We have coming credit crunches in commercial real estate when ARM loans reset,
prime home mortgages when ARM loans reset, private equity when principal comes
due on a ton of LBOs, local government as their tax base continues to
decrease, unfunded obligations increase, and they continue struggling under a
major load of debt, and local governments as well as their pension funds
suddenly lose large amounts of money due to overexposure to the private equity
debacle.

Of course we have bright points like bank profits, right? Wrong. The only
reason that banks are recording a profit is that during the credit crisis they
were allowed to stop marking debt to market. The major banks are all sitting
on a ton of future losses that are not properly accounted for. But since their
unrealistic accounting recorded a profit, they are paying themselves enough
money that the bankers (if not their employers) will ride out the coming
crises.

I could say more but I'll stop. I'm depressing myself.

~~~
kls
I could not have said it better myself, it seems like no one is talking about
the commercial real estate market just like no one dared say it on the eve of
the housing crash. I have been watching commercial rent plummet in the last
few months and cant help but feel that it is starting.

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mbrubeck
I'd love to see the ideas generated by a Y Combinator RFS for harnessing
millions of unemployed/underemployed workers.

Amazon Mechanical Turk is one part of the picture, and it opens up the door to
more. Anything that makes it cheaper to create work, hire
employees/freelancers, or find jobs is valuable in this economy. Or ways for
people to earn money besides the mainstream labor economy. Or something that
can generate value from activities that people do with their idle time while
they're unemployed - whether it's constructive like Wikipedia or entertaining
like Farmville.

~~~
SapphireSun
That's an excellent idea. One of the things that I really would like is a way
to earn money without screwing over a transitional employer by jumping ship
the soon as a real job comes along.

Ideally it would be open to anyone and everyone all the time commitment free.
At 3 AM, I have no idea how this magical service would work. Ask me after some
sleep and coffee ;-)

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ziadbc
There must be a template article out there for journalists. When it's a slow
news day you fire it up, fill in the blanks, and a few minutes later you've
got an article about how 20 somethings live with their parents, have no self
direction, and feel of sense of entitlement.

I think the same template has been in use for generations.

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hop
If you are receiving unemployment, I can't think of a better time to start
your own business. Great companies will be born out of this era that were
bootstrapped all the way. I think frugality and a focus on the bottom line is
a renewed theme. Even if you fail miserably you'll be light years ahead of
everyone else.

~~~
owinebarger
You would think so, but in fact the unemployment "insurance" agencies of some
(many?) states are overtly hostile to using your time to build a startup
rather than unsuccessfully seeking a position as an employee.

In Connecticut, for example, the statutes say revenue from self-employment
should offset unemployment benefits, but the state agency has chosen the
highly creative interpretation of "revenue" to include _potential_ capital
gains your efforts represent, and the notional amount of salary you should be
paying yourself for the work you do for your startup, including, say, writing
a business plan.

It does seem like they are shooting themselves in the foot, but the
unemployment "insurance" fund in CT is already living on debt.

~~~
asmithmd1
That does not make any sense.

Maybe there is a way to make the snake eat it's tail. After your payroll
paycheck bounces call up the state employer regulators and see if they will
make your paycheck whole.

Then post the whole thing to the web as a performance artwork

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john_lewin
Bit of a catch-22 with harnessing the underemployed. The longer the economy
maintains large numbers of underemployed, the less consumption in non-
essential goods and services, and the less people buying whatever it is you
sell, leading to the more underemployed, and the less consumption ... But if
consumption increases, right when you can actually use all that labor they
start to dissapear to proper jobs.

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fragmede
The idea of total jobless-ness makes me think of a short sci-fi story:
<http://marshallbrain.com/manna1.htm>

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john_lewin
ojbyrne, you raise a great point. But still, and perhaps naively, I find
myself bothered by this recession in particular. In previous recessions the
backbone of America -- our immigration policy, culture of competition,
education and infrastructure -- made it virtually certain that new indstries,
wherever they form, would center in the US. In our present state our
Universities are still the best in the world and our immigration policy,
albeit under fire, is still flexible enough to attract the best and the
brightest. Yet I know no less than three people (one with two successful exits
and a third company in the worlds in Boudler, CO) leaving California because
they want a better education for their children and the high schools are a
mess. Our infrastructure is extremely old, and as to the culture of
competition every year we are more protectionist in policy. It is not certain
to me that we will dominate the next generation of technologies the way we did
with automotive, computer, pharma and information in the past decades.

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donaq
That link crashes my Firefox for some reason. Anyone else having the same
problem?

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marshallp
It's the fault of the teacher's unions. 12 years of school gets you no
employable skills. If they simply started teaching programming in grade 8 to
everyone by grade 12 everyone would be employable (since there's an unlimited
supply of programming jobs).

~~~
louislouis
Programming jobs are not unlimited. There's just a big demand for programmers
and lack of supply. If every wannabe musician/artist/celebrity wanted to be a
coder we'd certainly feel the strain.

~~~
techiferous
marshallp has a point. There is a limit to the demand for food; after a while,
you are full. There is no hard limit to the demand for technology, because the
value that technology adds is the ingenious solving of problems, and it seems
that everyone always has problems.

