{"id":12731,"date":"2017-07-13T12:21:41","date_gmt":"2017-07-13T07:21:41","guid":{"rendered":"http:\/\/jworldtimes.com\/old-site\/jwt2015\/?p=12731"},"modified":"2017-07-13T12:21:41","modified_gmt":"2017-07-13T07:21:41","slug":"e-commerce-as-a-jobs-engine-one-economists-unorthodox-view","status":"publish","type":"post","link":"https:\/\/www.jworldtimes.com\/old-site\/studykit\/currentaffairs\/daily-articles\/e-commerce-as-a-jobs-engine-one-economists-unorthodox-view\/","title":{"rendered":"E-Commerce as a Jobs Engine? One Economist\u2019s Unorthodox View"},"content":{"rendered":"

\"E-Commerce<\/a><\/p>\n

By: Andrew Ross Sorkin<\/strong><\/p>\n

Retailing is dead. Sales clerks are losing their jobs by the thousands. The employment picture for young people with only a high school education is going to get even worse. And all this is happening because of Amazon and its ilk, which are driving the shift among consumers toward e-commerce.<\/p>\n

We\u2019ve heard this story over and over in recent months: The echo chamber keeps repeating that the retail apocalypse is upon us.<\/p>\n

And yet, according to one economist, Michael Mandel, it is all wrong. We have it backward.<\/p>\n

Mr. Mandel is turning heads from Washington to Silicon Valley with a provocative and unorthodox argument: He asserts that the move toward e-commerce is creating more jobs than are being lost in the brick-and-mortar retailing industry \u2014 and that these new jobs are paying much higher wages than traditional retail jobs.<\/p>\n

Mr. Mandel, chief economic strategist at the Progressive Policy Institute in Washington, contends that most economists are using the wrong job numbers to measure the e-commerce industry. He says that government numbers and conventional industry classifications don\u2019t properly count all the jobs associated with e-commerce \u2014 in particular, the numbers miss large parts of the industry like fulfillment centers and distribution warehouses. As anyone who has noticed the growing volume of big brown boxes being delivered to people\u2019s homes can imagine, facilities like that, which are tied to the e-commerce sector, are expanding rapidly.<\/p>\n

Mr. Mandel has combed through the job statistics on a county-by-county basis and come to this counterintuitive view: From December 2007 to May 2017, by his count, the e-commerce industry has created 397,000 jobs in the United States, and this compares with the loss of 76,000 jobs in the traditional retail industry. And those jobs related to e-commerce, he says, pay about 30 percent more than the brick-and-mortar ones.<\/p>\n

\u201cTo be honest, this was a surprise to me \u2014 I did not expect this,\u201d Mr. Mandel told me.<\/p>\n

Then he added, matter-of-factly, \u201cI\u2019m just looking at the numbers.\u201d<\/p>\n

Those numbers have helped him shape an optimistic, feel-good thesis about what is happening in our economy that may be worth considering, at least as a thought experiment. After all, the Progressive Policy Institute, a Democratic-leaning think tank, says its mission is to \u201ccreate radically pragmatic ideas for moving America beyond ideological and partisan deadlock.\u201d<\/p>\n

Viewing e-commerce as an engine of jobs \u2014 not just any jobs, but good ones that are spread around the country \u2014 would be a new paradigm, for sure. But it\u2019s one that admittedly requires a healthy dose of skepticism.<\/p>\n

\u201cThis could be transformational,\u201d Mr. Mandel argued, contending that the rise of e-commerce could lead to \u201ca reduction in economic inequality and geographic inequality.\u201d<\/p>\n

Mr. Mandel said that over the past quarter-century, \u201cproduction gains were not shared with the workers.\u201d But now, he said, jobs at fulfillment centers are \u201cdecent paying,\u201d often full time and usually with benefits. And many of those fulfillment centers are sprouting up across the country in \u201cplaces you haven\u2019t heard of in a while.\u201d<\/p>\n

With a burst of enthusiasm, he added, \u201cThis could be the pendulum swinging back.\u201d<\/p>\n

Of course, Mr. Mandel\u2019s view flies in the face of established economic thought \u2014 and perhaps for good reason: His arithmetic relies on certain unconventional assumptions.<\/p>\n

\u201cI\u2019m highly dubious,\u201d said John Challenger, president of Challenger, Gray & Christmas, an executive outplacement firm that maintains a monthly index of job losses across the country. \u201cIt does sound crazy to me.\u201d<\/p>\n

The warehouses that Mr. Mandel views as a source of job growth, Mr. Challenger said, \u201care being automated.\u201d<\/p>\n

Is it possible Mr. Mandel is miscounting or perhaps double-counting?<\/p>\n

In truth, his argument relies to some degree on the assumption that many of the new jobs created in a category known by the government as \u201cgeneral warehousing\u201d are tied to e-commerce. That may be a good assumption \u2014 but it\u2019s impossible to know for sure.<\/p>\n

Mr. Mandel justifies his assumption with an example of how convoluted the current method for counting e-commerce jobs is: Amazon publicly says it has 12,000 employees in Kentucky, but the Bureau of Labor Statistics reports only 2,640 workers in Kentucky in the e-commerce category. \u201cBy contrast, the general warehouse industry,\u201d Mr. Mandel writes, \u201chad more than 23,000 workers in Kentucky.\u201d<\/p>\n

All of which is to say that we may not have as good a handle on the demographics of the job market as we think.<\/p>\n

Mr. Mandel said he had been \u201cvery careful\u201d to look only at changes in warehousing since 2007. \u201cWhen I look at changes on a county-by-county level, they correlate very well with building of fulfillment centers,\u201d he said.<\/p>\n

He acknowledged that his number could be an overestimate, saying that it might include \u201crecent building of warehouses that are not for e-commerce reasons.\u201d<\/p>\n

But on the flip side, he also thinks it is possible that he has underestimated hiring in the industry. Some e-commerce hiring, he notes, is done through temporary agencies, and those jobs would not show up in the warehouse industry.<\/p>\n

To Mr. Mandel, it\u2019s not that e-commerce jobs are directly replacing traditional retail jobs. Rather, he describes a world in which some of what he calls \u201cunpaid household labor\u201d that we all do when we drive to the mall, park, shop and bring the goods home has been transferred into the labor market.<\/p>\n

Nationally, since 2007, \u201cthe decline in shopping hours is 64 million hours a week,\u201d Mr. Mandel said. \u201cThat\u2019s the equivalent of about 1.5 million jobs,\u201d some of which are now being created to staff the new fulfillment centers.<\/p>\n

But what about the coming revolution of robots and artificial intelligence? (After all, Bill Gates is so concerned about robots taking jobs that he has talked about taxing them.)<\/p>\n

\u201cRobots have been tough to do,\u201d Mr. Mandel said, suggesting that they will come, but that it will take longer for them to replace humans than we think.<\/p>\n

\u201cI\u2019m basically an optimistic person,\u201d Mr. Mandel said. \u201cI\u2019ve spent a long time looking at what happened in the first part of the 20th century \u2014 how we got the combination of jobs gains and higher wages \u2014 and I think we\u2019re on the same path.\u201d<\/p>\n

It feels a bit hard to believe to those of us who are inherent skeptics, but let\u2019s hope he\u2019s right.<\/p>\n

Source: https:\/\/www.nytimes.com<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

By: Andrew Ross Sorkin Retailing is dead. Sales clerks are losing their jobs by the thousands. The employment picture for young people with only a high school education is going to get even worse. And all this is happening because of Amazon and its ilk, which are driving the shift among consumers toward e-commerce. We\u2019ve …<\/p>\n","protected":false},"author":149,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[5285],"tags":[574,257,8438,1226,8686,610,1161,537,8467,3790],"_links":{"self":[{"href":"https:\/\/www.jworldtimes.com\/old-site\/wp-json\/wp\/v2\/posts\/12731"}],"collection":[{"href":"https:\/\/www.jworldtimes.com\/old-site\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.jworldtimes.com\/old-site\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.jworldtimes.com\/old-site\/wp-json\/wp\/v2\/users\/149"}],"replies":[{"embeddable":true,"href":"https:\/\/www.jworldtimes.com\/old-site\/wp-json\/wp\/v2\/comments?post=12731"}],"version-history":[{"count":0,"href":"https:\/\/www.jworldtimes.com\/old-site\/wp-json\/wp\/v2\/posts\/12731\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.jworldtimes.com\/old-site\/wp-json\/wp\/v2\/media?parent=12731"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.jworldtimes.com\/old-site\/wp-json\/wp\/v2\/categories?post=12731"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.jworldtimes.com\/old-site\/wp-json\/wp\/v2\/tags?post=12731"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}