Everybody is celebrating that the number of people who lost their jobs last month was smaller than the number for previous months, and the unemployment figure fell from 9.5 to 9.4 per cent unemployed. Meanwhile the stock market is going through the roof. What this means to me is that in the competition between labor and capital, capital is winning.
The consensus is that businesses are earning more money despite lower sales because they are cutting costs, which mainly means laying off workers.
The laid-off engineers and skilled mechanics may eventually get jobs, but many of them will end up working at McDonald’s, Wal-Mart, or in similar unskilled jobs that pay considerably less. This is good news for Wall Street, where executives will hire replacements for them in India or China for much less, thus cutting the bottom line as they begin rehiring at the end of the recession. The recession has been a great opportunity for American business to get rid of higher paid American workers forever, not just during the recession.