Coyer: Factory automation and the reality of Make America Great Again (column)
November 30, 2017
I had the opportunity to visit a successful Denver-area business this past week and take a tour of its fabrication facility. This is a business that customizes trucks for other businesses, and it employs fewer than 100 people. It is expanding into a new facility next year as a result of its successful growth.
During my tour, I came upon the area where cabinetry for the inside of the trucks was being produced from large sheets of plywood. Two workers were busy watching a machine cut the required pieces to make a cabinet. When the machine stopped, the workers removed the large piece of wood from the base of the machine and extracted the precision-cut pieces of wood that would be assembled to make a cabinet during the next stage of production. The small pieces of the plywood that went unused were tossed into a trash bin.
The manager leading my tour mentioned that before the machine was introduced into the process, this work required 12 workers, not two. Also, that the quality has improved with the machine, and the plywood waste material has been significantly reduced as a result of having a computer lay out the necessary cuts. She was justifiably proud of this fact, and I am sure this is one reason for the competitive success of the business.
Our next stop was an area where graphics were being produced that would be applied to the outside of the trucks, identifying the business owner and other details the customer wanted on the side of the business's trucks. Computerized printers produced these beautiful, incredibly detailed and eye-catching graphics.
I did not ask, but I assume this process replaced a stenciled and hand-painted product used in past years and probably required significantly less low-skilled labor, similar to the cabinet area I visited previously. The jobs that remained in both areas were higher skilled ones, and better paying, as the computers involved needed programming and management.
The tour has haunted me for the past couple of days. The implications I drew from the tour for our businesses and our country are enormously significant. The most important factor here, to my mind, is the success of the business. Its growth is providing many dozens of jobs and better paying ones in many areas of the firm. But it is also leaving a significant number of lower-skilled workers behind.
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Where do these workers go to find new jobs? Do the new jobs require skills that they do not possess? In most cases, the answer is "yes."
This scenario has been playing out in our economy for decades, and the process of automation and increases in productivity it brings continues to leave the less-skilled laborer behind. There are thousands of small businesses across America that have used the same strategy as the business I visited to grow and prosper. Of course, there have been large businesses doing the same thing — the number of hours of manual labor in an automobile declined 38 percent in 15 years, from 1987 to 2002, for example. And — more bad news for the manual laborer — where automation has not been applied, businesses have relocated to lower-wage areas of the world such as Mexico and the Far East.
Our populist president was elected, partially, because he promised to Make America Great Again and "bring back" these jobs. This is an empty promise and cannot be fulfilled. The company I visited would not be successful under its old strategy, and most of our businesses would suffer similarly. America is great now and always will be as long as we have businesses that are intelligently run and adapt to new technologies and processes.
But what of the unemployed worker who is left behind? I would submit that our country should invest in job training, apprenticeships and worker relocation programs to get these workers back to work. And the funds required to do this should be the funds that have been proposed to go to the wealthy in the proposed phony "tax reform" legislation now being fashioned in Congress.
Does a millionaire really need a $75,000 tax cut? Does a successful businessman like our president (I pick on him because we have data from an old tax return and he is behind this tax cut proposal) need a $35 million dollar tax cut (a result of eliminating the Alternative Minimum Tax), plus an estimated $1 billion tax cut his heirs would get by eliminating the Estate Tax? This tax reform package would not MAGA, but applying resources to help train workers left behind by automation will keep America great.
Steve Coyer lives in Avon.
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