I agree with Mona Charen that if Romney wins he can improve economic growth simply by weakening or removing some of the obstacles to it erected by the current administration.
But I think Republicans would be well-advised to be very cautious in predicting more rapid employment growth. Jobs may come back but they're not likely to be developed either quickly or easily. There is a lot of--admittedly mostly anecdotal--evidence that recent job losses are due to deep structural changes in the U.S. economy.
What is left, when this recession finally recedes, is a landscape where mid-skilled jobs are fallow, where someone who once worked in retail has lost their job due to the rise in online shopping, or an administrative executive has been replaced by new software. Economists fear this trend may be compounded by what Obama, too, sees coming: a dearth of mid-skill positions offered by businesses who’ve managed to raise productivity and profit margins while slashing jobs.
There are job openings in the U.S. But the people living near those jobs don't have the relevant education or training to get them, according to a new report out today from the Brookings Institution. The report looks at education, job openings and unemployment in the 100 largest metropolitan areas in the U.S. between January 2006 and February 2012 and finds that the overall unemployment picture in metro areas gets a lot worse when the workforce's educational background doesn't match up with the requirements of employers.
What economists call the "skills gap" is one of the leading causes of unemployment today.
Quite simply, the demand for high-levels skills is outpacing the amount of people who have those skills, contributing mightily to structural unemployment, a term that refers to those out of work for reasons that exceed simple economic gyrations.
"Today, there is a significant and growing mismatch between the country’s demand for talent and its current supply," research firm Deloitte said in a study released last week examining the skills gap issue. "The type of talent demanded today — and needed tomorrow — is increasingly either outdated or out of stock."
There are two broad shifts that account for much of this decline: globalization and computerization. From T-shirts to toys, manufacturing jobs have migrated to low-wage countries like Vietnam, Bangladesh, and of course China. Meanwhile, many of the tasks that might have been done by middle-income Americans employed as bookkeepers or middle managers have been replaced by spreadsheets and data algorithms.
So the ADP numbers and GDP revisions, if accurate, show that the United States economy is only producing enough jobs to do a little better than keep pace with population growth. When one combines this with the frightening news that Federal Reserve Bank of Minneapolis President Narayana Kocherlakota recently stated “…our country’s current labor market performance is much closer to ‘maximum employment,’ given the tools available to the FOMC, than the post-World War II U.S. data alone would suggest.” As Louis D. Johnson astutely notes, “What does that last sentence mean? In plain English: Kocherlakota believes that unemployment won’t fall much below 8 percent for the foreseeable future.”
At best, the 12 million job promise seems a shaky proposition. Wouldn't it be refreshing if, for once, America's political leaders understated their case. Perhaps Romney should have promised 8 million jobs or 10 million - or maybe he shouldn't have promised at all. Now, there's a fantasy!
Finally, amidst the gloom, a bit of optimism: "Jobs of the Future: Why the Political Class Should Read Michael Saylor's 'The Mobile Wave"".