Jobs again

It almost a year since the low points in the Market in 2009 and the questions about the recovery and the pace of market recovery are still open. There is clearly improvement in the economy over what we had, but the real estate market, which fueled so much spending as prices appreciated, has not recovered. In fact, it isn't at all certain that prices are stable. So all that wealth is gone and not likely to come back, at least not quickly and all those construction jobs are also gone and will only come back slowly.

The economy needs a growth industry, and I've been saying here that our best hope is in the energy area if we really promote a switch from foreign energy to domestic energy. Would that by itself be enough? Well it certainly does a number of good things, creating some jobs and keeping some wealth in this country. Jobs, like everything else live on the margins. There is some number of jobs that will exist in almost any economy. These are pretty basic and may vary in number but certain levels of goods and services will always be needed and that represents the core level of jobs. There is also an upper cap on jobs, at least in this country, and that is the number of available workers. Now that number can vary as more workers can be drawn into the work force when jobs are plentiful and salaries are high.

Between those two numbers we have the actual number of jobs. What has to happen, and what seems to be happening, is that we need to create more jobs than we eliminate. If you add a new source of jobs, you have created a positive force without a corresponding negative one. Many of our new industries, especially technology related ones, come at the expense of brick and mortar industries. So an on-line shopping site creates jobs, but probably less jobs than get eliminated as less retail stores are needed. Over time, being more efficient is a great thing, but it can be painful in the short run. There is no doubt that the recession caused companies to really scrub the jobs they had and look for more efficient approaches. Their success will help the recovery but not create jobs as fast as they were lost.

We need to do that energy thing.