The mainstream story you are supposed to believe is that first we save the banks, who then help the companies in the broader economy to recover, who in their turn bring relief to you and me as they finally start to re-hire the unemployed. We just have to be patient and wait in line.
What we can do is watch the signs that the plan is working. The main sign is the recovery in the stock markets. The broader recovery we are all told is coming, starts with the rally in stock prices which is the measure of how much investor confidence and money is going back in to re-building the companies who will, eventually, start to produce more and re-hire those who lost their jobs in the ‘down-turn’. That’s the story.
Except that those jobs aren’t coming back. Why should they. What rule says that companies will want to return to making stuff at the old factories with the old work force? What some sort of gratitude or loyalty?
Remember back in January this year when Opel closed one of its big plants in Antwerp and moved production to South Korea? Then in February Opel said it would close one of its big plants in Germany. Job losses were in the thousands. All necessary to save money and survive the wreak of GM.
Yesterday Opel released news that it is investing €500 million in Hungary to create a brand new engine plant to produce its next generation of fuel efficient engines which will create 800 new jobs. This is great news for Hungary. It is a clear vote of confidence in the country. The Hungarians deserve some support and good news.
BUT the news is not so positive, though equally clear, for Western European workers. Their jobs are NOT COMING BACK. Management has decided we cost too much and now is the perfect time for them to make the decisive move out. The skilled work has been exported to people who will be grateful to do the same jopbs for less money. fewer holidays and most importantly, lower pensions. The wave of redundancies has been a gift for management. They have received the massive government, tax payer funded bail outs (Cash for old cars) pocketed that and moved on.
Tax payers are told a story of solidarity and helping out for the greater good. The companies whose greater good we are working for are in a quite different story. Theirs is of single minded competitiveness, cost cutting and moving to low wage, low pension countries.
The brutal fact we are not encouraged to notice amongst all the ‘pull together for the good of the economy’ rhetoric, is that the longer this recession goes on, the more irrelevant the old factories, old work-force, old skills and old country becomes.
Our SOLE AND ONLY use from now on, is as the donkeys to clear up the mess left behind as the money, jobs and future are off-shored to cheaper places.
It's funny the timeline of things. The Roman empire was kicking it, driving round in drop tops with a new suit every week and then like every shooting star it burnt out. Good ol' Gordon selling the last of our gold is pretty much the same as a bawler having to sell his gold.
It aint a good look.
You could be wrong about the jobs coming back to the players on the street but the thing with players is they be fronting all the time and then all of a sudden the golds gone, the convertables gone, the women are gone, they got a bad relationship with the rock and end up in a squat sucking on a glass "£$! all day.
Can't go up until you hit rock bottom.
I'm no economist but i think the soft top is looking rusty
Hi Golem, I agree with 24K – too much John Laurie.
I concede that employment in the big companies may never return to the same levels seen in the noughties; however, the majority of people outside the public sector are employed by small companies like my own. Small companies tend not to export their skills and supply requirements to other countries, unless faced with a price-critical large order, which implies they may not be a small company for much longer.
In my experience most small companies are set up by ex-employees of larger companies. Large companies lay people off who then set up small companies that can survive on a shoestring.
Having said all that, the cheapening of labour remains a grave threat when the cost of living remains unadjusted. Echoes of GreatGrandDad again.