Globalization Requires Competitive Education and Training
NAFTA is anathema to many people.[i] The President wants to pull us out of the agreement. He also wants to extricate us from several other trade agreements. Free trade isn’t free but it is a global reality. It cost some Americans their jobs. It also creates American jobs. A promise to renegotiate the agreements with an America-first emphasis helped win the last election.
New England textile companies moved south in the 40s and 50s, eliminating thousands upon thousands of high paying jobs, ruining the economy of northern towns, cities, and families. The South offered significantly lower wages, electric costs 44% lower and transportation costs one third lower than up North. In the ‘50s, the minimum wage was 75 cents an hour compared to the union rate of $1.20 in New England.[ii] The bottom line always moves to lowest costs. By 2004, most of the southern plants had moved to Mexico, India, or China, which had lower costs. Americanization morphed into globalization!
The United States has a number of examples of its ability to produce excellent products at reasonable costs. The car industry is one example. Honda has twelve manufacturing plants in the US that build 73% of its cars sold here. Mercedes announced last month that it would invest one billion dollars in new car and battery plants in the US. Toyota is investing billions in the US. Its Camry is one of the largest selling cars in the US and it’s made here. Volvo just announced plans to invest 500 million dollars to expand its US plant. They are investing here because of the high productivity of the US worker, low wages and start-up costs and because there is a market for their products. Did you know that the largest exporter of American made cars is BMW,[iii] and the second largest is Mercedes?
The Dreamliner, Boeing’s proud entry into the modern commercial airline industry, is really only assembled in the US. Its components: wings, fuselage, wingtips, landing gear wells, tail, and stabilizers, come from Japan, Italy, Sweden, or Australia, as well as the US.[iv]
The President wants to punish US companies that move manufacturing to other countries because it diminishes our production capabilities and costs Americans jobs. He suggested a 30% tariff on Ford cars brought back into the country from Mexico. That suggests that he too doesn’t have a good grasp of global economics. We know that automation caused 83% of lost jobs in the past ten years.[v] The next five to ten years will see upwards of fifteen million US jobs lost to Artificial Intelligence technology, higher than the job loss during the Great Recession.[vi] Most will be unskilled jobs. Foxconn, a Taiwan company building a plant in Wisconsin with 13,000 jobs will make the glass faces for IPhones. A general manager, however, stated that they have a 3-phase strategy for complete factory automation. In a few years, it wants only a few employees for logistics and quality control.[vii]How long can we ignore the speed with which technology is changing the very nature of work and our culture?
Globalization changes the dynamics of business. A company like Ford, with plants in 21+ countries, is a worldwide company that happens to have its headquarters in the US. BMW, with plants around the world happens to have its headquarters in Germany. Is Apple a US company? Is Google? Is Facebook? Apple can’t manufacture iPhones in the US because we don’t have trained employees, yet its employees work in 22 other countries. George Will suggests that we are in an Age of Complacency.[viii] We fail to see the need for urgency or we ignore it. We’ve ignored it for too many years. It’s time to do something.
W. Edward Deming, the father of quality management, opines, “Without data you’re just another person with an opinion.”[ix] Well, we have the data. We know technology is moving faster in two weeks today than it did in a century in past times. Development is at a level where deep learning technology and big data analysis nearly replicates the human brain. Assurances of massive job losses because of technology seem real. If we know this, shouldn’t we do something about it?
For the most part, our schools don’t teach robotics and coding or much about artificial intelligence. If they do, it’s to a few students in after-school clubs. Our country needs highly skilled employees to compete, urgently! An untrained workforce is one of the unintended consequences of focusing curriculums almost exclusively on college prep. We knew that 70%+/- of our students don’t go to college, yet we eliminated most vocational education in most high schools.
Here is my take.
· We all need to understand the integrated world. The U.S. worker competes with billions of people around the globe. We don’t have a national strategy for developing a modern workforce. A better-trained workforce is a national problem not a local issue
· Parents and Grandparents need to become less technology challenged. “I don’t like computers and smart phones” isn’t acceptable anymore. It sets a wrong model for the next generations. We must insist that schools change to meet the needs of a modern world. Change is coming too quickly to wait for an evolutionary process
· State legislatures need to reassess their emphasis on college prep for everyone. People don’t need a college degree to get a good paying job when trained for the needs of the new economy.
· Teacher certification programs need to develop coding skills, technology applications, AI and robotics
· School Boards need to change their curriculums to include coding as a primary subject in elementary schools, continuing through high school
· High Schools need to develop a solid four-year robotics curriculum, with at least one year required of all students. All students need an introductory course in artificial intelligence, its uses and its methodology
· Community Colleges need to up their game to become centers of technical education, acting as extensions of the local high schools
· The federal government needs to provide the seed-money to improve school curriculums. New equipment is expensive
· Business and industry needs to take the lead to help schools institute programs that will qualify students for good paying jobs.[x] Think Germany
· Business and Unions need to develop hi-tech apprenticeship programs to train potential employees.
What do you think?
[i] North American Free Trade Agreement
[ii] The Atlantic – John F. Kennedy – January 1954
[iii]BMW Manufacturing Remains Largest U.S. Automotive Exporter –BMW Manufacturing News Center -2016
[iv] Modern Airliners.com - 2015
[v]Thanks for Being Late – Thomas Friedman - 2016
[vi]CBINSIGHTS – 10 Million Jobs At High Risk of Disruption – 09 /2017
[vii]Dai Jia-peng – Digitimes 2016
[viii] Age of Complacency – George Will – Washington Post – September 25, 2017
[ix]W. Edward Deming – Out of Crisis - 1982
[x]Watch this short video at www.YouTube.com - BMW Series 3 Assembly – to get a better understanding of modern manufacturing
