global economy

Posted: January 14, 2015
By: Clay Cerny

 

While this month’s employment report again showed more jobs being created and a falling unemployment rate, wages dropped. According to past trends, wages should go up as labor becomes scarcer and companies want to retain productive employees. Former Labor Secretary Robert Reich analyzes this situation in a recent blog post. Reich points to factors that can hold wages down even as unemployment shrinks. Two main culprits are the global economy and automation. Companies can offshore cheaper labor, and they can find new ways to let technology replace humans. Reich scoffs at those who call these factors “efficiency.” Reich concludes by blaming both large corporations and Wall Street for holding down wages. I’d agree with him and add one more culprit: spineless politicians who serve Wall Street and large corporations. Nothing will change until our politicians and laws provide some protection for American workers. Or, to put it another way, nothing will change until American voters elected politicians who represent the interests of working people.