Recession, the U.S. Economy, and Jobs Migration

When labor costs for a company rise, the company looks elsewhere to meet its needs for labor while maintaining profitable. And that has been the condition in the U.S. economy for quite some time resulting in high-paying technology jobs migrating to India and to some extent other Asian neighbors. However that is just one aspect of it. Those same companies still need to sell their products (produced now with foreign labor) in the U.S. economy. However one of the effects of job migration is that the average American no longer has these high-paying technology jobs. Therefore, he or she has no buying power and the country slips into a recession. So the effects of job migration and recession will be felt globally. Let’s look at some other dynamics of this:

The U.S. is mostly a service nation. This is because manufacturing jobs have also migrated overseas for a number of years. The effect of the recession on the U.S. economy can be seen where companies cannot sell as many products and therefore do not need as many technical support and helpdesk service staff. The problem is that there is not much of a skilled job base for the U.S. worker to choose from any longer.

The problem of border enforcement will continue to erode the job market. The problem with immigrants working illegally in the U.S. is the fact that a few employers take advantage of the situation. There is no mechanism in place to prevent an employer hiring illegal aliens from paying them less than minimum wage and/or subjecting them to the worse working conditions. For employers like these, the savings they realize is worth the risk in their mind. But still, the U.S. citizen is without a job and with no real buying power the recession continues.

Thinking Americans will not take certain jobs that no one else wants is a myth. Most Americans, when they want to feed their families want a job and they pretty much want any job. But when there is competition from illegal aliens or H1-B visa holders, the fallback for employers is saying that these are jobs Americans would not take anyways. All this does is continue to erode the American job market and drive wages down hurting the buying power of consumers in the U.S. economy.

There will be a growing trend of American expatriates. When the American breadwinner can’t find a job to feed the family, migrating to another country where the cost of living is much more affordable becomes an option. Some Americans have ties through marriage or job opportunities to be able to live and work somewhere else and not fight with high cost of living that is a byproduct of the recession plaguing the U.S. economy. Challenges include learning the local language, getting permission to work in the host country, and complying with local immigration laws but it can mean the difference between being on welfare roles and having a reasonable standard of living.