Wednesday, August 3, 2016

Jobs and Growth

I've been reading a bit about economics recently and one clear point seems to be that no qualified economist believes that trickle-down a.k.a supply side a.k.a. neoliberalism a.k.a reagonomics/thatcherism actually works. It does not lead to significant growth, tending instead toward depressing economies and, in general, no new jobs are created.
From a logical point of view it seems to me that this has a lot to do with how well established a business is. New industries create new jobs - entirely new, things that people have not done in the past and are not yet understood well enough to automate. Old, large, established industries have defined processes, tools, targets etc. and tend toward getting more efficiency out of their existing resources. Hence automating, tuning and generally reducing costs - including labour. People may move from one company to another but there are rarely new roles created within the industry as a whole.
In other words, from the government point of view, creating jobs is more likely to arise from supporting small and emerging businesses - especially new industries. In other other words - renewable energy, new technologies, start-ups. Science and other research lead to new ideas and new approaches, especially in the things like uses for big industry waste products, and hence to new industries, growth and jobs.

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