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U.S. economic recovery: Values shift, workforce preparedness are factors

In survey after survey, two of every three Americans believe that our nation is in decline. While the specific reasons for this pessimism are unclear, there is an undeniable “values shift” unfolding as younger workers are moving away from traditionally wealth-producing careers and toward often enlightened but less economically productive ones.

Problems in portions of our U.S. labor market are deep and intractable, yet there is no mistaking that the economy has moved from the hardheaded practical mentality that, over two centuries ago, first began building the nation’s remarkable and enduring wealth.

Many of America’s brightest minds have been abandoning industry and technical enterprise in favor of occupations in law, finance, consulting and nonprofit activism. In a report issued in 2007, 58 percent of male Harvard graduates and 43 percent of female graduates went into finance and consulting.

Consumption, debt, trade deficits higher
The transition to high-value services has seen consumption, debt and the trade deficit reach record high levels. One example is in traditional manufacturing, where firms are no longer able to hire skilled machinists. If they could do so, the nation’s 9.6 percent unemployment level would drop to 6.5, according to a recent study by the Minneapolis Federal Reserve Bank.

Today, economists I know tell me we are in the middle of a “near jobless recovery.” The poverty level has risen to 15 percent; home foreclosures are at a record high. All of this is compounded by the fact that real income for working families has been lagging for decades, as some potentially productive Americans have been unable to succeed in the workforce. 

Though not often discussed in the general public, one in three of American children are living with one or no parents, too often in chaotic lifestyles involving domestic violence, hunger, housing and education challenges. For them, there is little likelihood of economic self-sufficiency in adulthood.

Some hopeful economic signs
Recent economic data has indicated some favorable trends as U.S. private employers added more than 100,000 jobs in July and August. There appears to be little danger of a new downturn in activity as unemployment claims have been reduced, the trade deficit is narrowing some and there has been an uptick in key segments of the stock market.

The nine in ten of our workforce population who have jobs are apparently gaining greater confidence and are spending some of their hard-earned dollars on bargain-priced goods. Additionally, many Americans are beginning to save their dollars, portending, perhaps, a permanent newfound frugality.

Over 90 percent of Minnesota employers’ report that they are planning to maintain or add to their workforce. Even Warren Buffet is saying with some confidence that his businesses are coming back.

All of this adds up to hopeful signs for the stuttering economic recovery.

Opinion polls assessing prospects for the 2010 election further suggest that voters this year — dissatisfied with President Barack Obama and Democratic majorities in the Congress for their management of the economy — could punish Democrats and turn over control of the U.S. House of Representatives, and perhaps even the U.S. Senate, to Republicans in November.

While anti-government public sentiment is stronger than in the recent past, it remains unclear how a partial regime change in Washington will make any substantive difference in the current economic swirl.

Chuck Slocum is president of The Williston Group, a management consulting firm. He can be reached at

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Comments (4)

  1. Submitted by Richard Schulze on 11/01/2010 - 07:16 am.

    We are in great need of a leader. It’s not mere politics. Politicians lie and talk nonsense because the public doesn’t want to hear difficult truths. Leadership consists in finding a way to make them listen and understand and support the necessary actions.
    Can we still elect one?

  2. Submitted by Greg Kapphahn on 11/01/2010 - 07:56 am.

    What Mr. Slocum ignores is that all the employment trends he identifies are the likely result of the reduction in the influence of unions in the US workforce.

    Young workers are attracted to jobs in which they can hope to guarantee themselves a prosperous life. After the unions were largely wiped out, manufacturing simply has not offered those types of jobs.

    The pressure that Wall Street has continuously exerted on manufacturers to reduce their labor costs (while maximizing their management salaries) has meant that the compensations offered for even skilled manufacturing jobs has continuously fallen in comparison to the rest of the economy.

    In the end, this current economy is not the result of “natural” economic cycles. It’s the result of careful engineering by a subgroup of the wealthiest of our citizens, and has allowed them to gather to themselves a continuously-increasing share of the proceeds resulting from everyone else’s labor (in whatever field), while compensation has fallen for all others.

    With their ill-gotten gains, they have now purchased the mainstream media, and have their own Propaganda Network in weasel “news,” and use those sources to continuously misdirect the anger of the general public at their reduced standard of living and reduced prospects, away from those who have arranged those reductions toward “big government” and “big spending Democrats.”

    The reality is that the economy we have is the economy that serves the economic and psychological needs of The Koch brothers, Murdoch, Ailes, Russo, Luntz, Norquist, et al. The massive wealth they’ve already gathered to themselves allows them to arrange things to their own liking and hide what they’re doing from the rest of us.

    The only solution to the way these people have been able to manipulate the government and economic systems on which we all depend is to change those systems in key ways – to cut off their influence over the government by passing a constitutional amendment requiring strict time limits and nothing but equalized public financing for all national political campaigns as well as placing strict limits on lobbying activities and even the employment of ex-politicians (we pay them enough of a pension with benefits that they shouldn’t need to work).

    Lacking those changes, even the most honest and innocent “Mr. Smiths” we send to Washington, no matter what political party they claim, will inevitably be corrupted by the money chase and put in the position of having to serve the interests of the big money donors who finance their campaigns, interests which often result from the psychological dysfunctions of those big money donors and which certainly run counter to the healthy interests of the rest of us.

  3. Submitted by Paul Brandon on 11/01/2010 - 09:58 am.

    “Over 90 percent of Minnesota employers’ report that they are planning to maintain or add to their workforce.”

    What percentage of employees do these 90% employ? If they are mostly small businesses, they won’t have much effect on overall employment.

    Second; one should separate ‘maintain’ from ‘add to’.
    Maintaining one’s employees in a period of high unemployment (after major job cuts have been made) is at best not making a bad situation worse; it is not a solution.

    So the real question is:
    what percentage of employers (weighted by size of work force) are actually ADDING employees; not simply thinking about it (planning to do something is cheap,; it’s action that counts).

  4. Submitted by Richard Schulze on 11/01/2010 - 06:56 pm.

    It is true that small companies create jobs, especially when they are first born. And small companies destroy millions of jobs when they die—which is often. In fact, only a small fraction of smaller enterprises are capable of generating sustained growth of very many jobs. Yet politicians from both parties fall over themselves as the protectors of small business, creating programs that often help big corporations (and wealthy hedge-fund managers) as much or more than favored smaller enterprises.

    This is one of the keys to America’s apparent inability to do much of anything about anything, lately: the dominant, “mainstream” conversations in media and politics are frequently discussing a parallel reality whose shape is based on cherished/convenient myths rather than facts.

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