High Unemployment

Pietro Savo

The United States’ poor economy, and high unemployment resulted from a combination of not invest in manufacturing, design research, human education, and government policy changes such as Free trade agreements (FTAs). Currently there are FTAs with 15 countries. Australia, Bahrain, CAFTA-DR, Chile, El Salvador, Guatemala, Honduras, Israel, Jordan, Morocco, NAFTA, Nicaragua Oman, Peru, and Singapore (“Free Trade Agreements “, 2010). One FTA in particular had a monumental effect on jobs in the United States. The North American Free Trade Agreement accredited for 1.1 million manufacturing jobs lost over the first 3 1/2 years (Prizinsky, 1997).

The total number of people in the United States who lost their jobs from March 2001 to October 2003 was 2,400,000 (“NAFTA Turns Ten 1994-2004 “, 2004). The 2,400,000 lost jobs are those that left the United States shores completely, what also accounts for the high United States un-employment is the 24 million Mexican immigrants willing to work for a fraction of United States citizen wages. NAFTA opened up the borders with Mexico, some 24 million immigrants live in the United States today either as citizens, and it is estimated the 12 million immigrants are un-documented. The former Mexican president Vicente Fox reported that in 2005 Mexican citizens working in the United States sent back $18 billion, the World Bank estimates that in 2006 that figure reached well over $25 billion (Bacon, 2008). That explains why today the attention and emotional connection are on NAFTA, with the reported job loss data and staggering un-employment rate witnessed today; this also contributes to organizations not having the money to invest in new technology, equipment, design, and development and employee education. Such lessons from history, resulting in economic perils associated with not investing in manufacturing, design research, and human education.

The industrial foreign trade policy that attempted to balance the trade between Mexico, Canada and the United States, clearly had a greater negative effect on the United States workforce that policy makers predicted (Prizinsky, 1997). Robert Scott (2001) writing for the Economic Policy Institute addresses why NAFTA core principles better supported the 50 years of the strategic industrial growth policies of Japan, Korea, Taiwan, Malaysia, and China than the industrial growth policies of the United States. The Asian model, of simply protected their industries; Asia invest heavily in manufacturing process research, and employee education, and subsidize R&D investment (Scott, 2001). This strategy represented the complete opposite of what occurred in the United States as the result of NAFTA (Scott, 2001).

The United States has failed to learn lessons from their past; they did not protect their manufacturing industries and consequently important knowledge and good paying jobs are lost.

References

Bacon, D. (2008). Displaced People: NAFTA’s Most Important Product. NACLA Report on the Americas, 23-27.

Free Trade Agreements (Publication. (2010). from International Trade Administration, U.S. Department of Commerce:

NAFTA Turns Ten 1994-2004 (2004). NACLA Report on the Americas, 37(4), 6-39.

Prizinsky, D. (1997). “NAFTA levels a soft blow to Ohio jobs so far.” Crain’s Cleveland Business. Crain Communications, Inc. 1997. Retrieved June 21, 2010 from HighBeam Research: http://www.highbeam.com/doc/1G1-50355528.html.

by AMERICAN WRITER Pietro Savo Tradition Books Publication © 2010

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About Dr. Pietro Savo

Dr. Pietro (Pete) Savo is a Principal Consultant with over 28 years of diverse experience in Business Strategy Improvement (BSI), Leadership Development, Operations, Engineering, Manufacturing, Quality Systems, Material Management, Supply Chain, Union Shop and consulting environments. Pietro created the term Manufacturing Research Practitioner ™ as the foundation for his Doctoral thesis dedicated to improving the United States Manufacturing Industry.  Dr. Savo has lectured at, Boeing Aircraft, Lockheed Martin, Rolls Royce, Northup Grumman, Raytheon and United Technologies on various subjects such as Lean Thinking, Leadership, Team Building, Quality Systems ISO Registrar Selection and Root Cause Analysis. Taught Root Cause Analysis for American Society for Quality (ASQ). Customized Training Specialties Leadership & Culture & Conflict Resolution Made Simple Root Cause Analysis (RCA) Problem Solving & Mistake-Proof It! Lean Manufacturing & The 6S's: Workplace Organization Evolving Quality Systems ISO 9001:2000/AS 9100:2000 Industry Evolution Building Business with the United States Government and Prime Contractors New Project Bidding Team Improvement Training “Know Your Front End” Published: Root Cause Analysis System for Problem Solving and Problem Avoidance Published: PERFECTION - 10 Secrets to Successful Lean Manufacturing Implementation. United States Navy Veteran View all posts by Dr. Pietro Savo

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