The ugly truth about an economics hack

In “The ugly truth about layoffs”, Jack Lessenberry quotes Louis Uchitelle’s ugly half-truth. Uchitelle claims 30 million full-time American workers have lost their jobs since the 1980s. Strangely, the Bureau of Labor Statistics reports that the number of Americans employed full time rose from 117 million in 1989 to 139 million in 2004. He must have meant that while 30 million jobs were destroyed, another 52 million were created to take their place. Otherwise how do we account for the fact more jobs exist today than the eighties?

A main characteristic of free markets and economic success is “creative destruction.” The innovative drive that produces a wealthy society destroys some jobs while creating others. Layoffs are ugly, painful and, contrary to Uchitelle, necessary. The solution is not to prevent them, but rather to prepare for them. Each individual worker must take responsibility for learning new and relevant skills for when their job changes or disappears. Imposing government barriers that prevent entrepreneurs from adapting to changing markets and technological advances will hurt, rather than help.

Uchitelle’s “sensible solutions” would lead to higher unemployment and a stagnant economy as demonstrated by Germany and France. If Uchitelle plays as loose with other facts in his book, I can think of one layoff that is necessary.

[Letter to the Editor - Metro Times. Submitted 04/17/2006.]