Comment 29178

By How'bout (anonymous) | Posted February 27, 2009 at 14:55:51

I mostly agree with your assessment of retail-service jobs, Jason, though I would hasten to add that this in no way reflects on the quality of the people who take them. The thing about service jobs, though, is that they're not easily exportable, catalgues and internet sales notwithstanding. As we're increasingly learning, manufacturing jobs are easily exported when employers find they can make their products cheaper elsewhere.

You can make shoes almost anywhere in the world but if you want to sell me a pair and I insist on trying them on before I buy you pretty much have to have someone nearby to put them on display and collect the money, at least. So I wonder why, as the service economy kicks into gear, we are still reluctant to raise the minimum wage and block the efforts of employers to avoid paying benefits etc. through the use of contract and part-time hiring practices.

There's little benefit to the local economy if we try to protect low-paying manufacturing jobs. What is the point of competing with third-world economies for the honour of paying the lowest possible wages? That only reduces the buying power of the local population which is necessary to support even the local service economy. Retailers will stay in a community as long as they can sell their products at a profit.

It's true that decent wages and employment standards might cut into retailers profits, but I think you'll find that there is plenty of room in the markup on a pair of, say, NIKES and other fashion products.

There are some retailers with margins that cannot absorb higher wages. In these cases I suggest that higher prices will be a necessary sacrifice to make sure that more people can participate in the local economy. Don't forget that service-sector employees are also consumers and can be expected to contribute their higher wages to the local economy, creating more local wealth.

None of this should effect the employability of the highly skilled in the surviving manufacturing sector. They are already earning well above minimum wage and generally have unions to protect their working conditions. They can and will protect their jobs by continually upgrading their skills. But if we must have the service sector playing a bigger role in our local economy, and it appears that we will for the next several years at least, then we should make sure they the local economy benefits as much as possible from this change.

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