February 13, 2016
In his final state-of-the-union address, President Obama famously accused anyone who dares to question the strength of the US economic “recovery” of “peddling fiction.”
Shortly thereafter, we learned that the US economy grew at a paltry 0.69% in Q4. Below estimates.
Perhaps the most disturbing thing about the state of the economy – well, besides the fact that healthcare spending is essentially driving “growth” – is that the labor market has becoming a waiter and bartender creation machine. That’s come at the expense of manufacturing jobs, where skilled workers can actually earn a decent living.
Here’s what the disparity looks like since 2007:
No fiction “peddling” there. Just numbers.
Additionally, we’ve noted the fact that foreign born workers account for the vast majority of job creation in America since the crisis:
On Wednesday, United Technologies decided to reinforce both of these trends all at once, when the company announced it would be eliminating 1,400 jobs at a Carrier plant in Indianapolis in favor of hiring some new “foreign-born” employees – only these “foreign-born” workers will be hired in Mexico.
“Two Indiana plants that make products for the heating, ventilating and air conditioning industry are shifting their manufacturing operations to Mexico, which will cost about 2,100 workers their jobs,” The Indianapolis Star reports. “Carrier is shuttering its manufacturing facility on Indianapolis’ west side, eliminating about 1,400 jobs during the next three years [and] United Technologies Electronic Controls said that it will move its Huntington manufacturing operations to a new plant in Mexico, costing the northeastern Indiana city 700 jobs by 2018.”
Watch below as 1,000 soon-to-be Donald Trump voters react to the announcement:
Economists called the move “highly unusual.” “Today’s surprise announcement was without warning,” the mayor said.
Actually, it’s neither “highly unusual” or “surprising.” Here’s why (again from The Star): “Carrier’s workers are separated into a two-tier wage system. A quarter of the workers make about $14 an hour, or about $30,000 a year. The rest make about $26 an hour, or about $55,000, but make well above $70,000 a year with overtime.”
Something tells us labor costs will be “slightly” lower south of the border.
Who’s “peddling fiction” now?
This article was posted: Saturday, February 13, 2016 at 8:41 am