Machines Continue to Defeat Humans With Ease

Wondering why you're still unemployed while corporate America reaps record breaking profits? One reason is that instead of spending on workers, companies "are snatching up cheap, tax-subsidized tractors, computers and other goods."

"You don't have to train machines," as the poor, put-upon businessman quoted below keenly observes.

The Captain would like to note that you also don't have to drug-test job applicants, an onerous burden the businessman cites as one of many reasons he's loath to hire people instead of just buying more machines.

Workers are getting more expensive while equipment is getting cheaper, and the combination is encouraging companies to spend on machines rather than people.

“I want to have as few people touching our products as possible,” said Dan Mishek, managing director of Vista Technologies in Vadnais Heights, Minn. “Everything should be as automated as it can be. We just can’t afford to compete with countries like China on labor costs, especially when workers are getting even more expensive.”

[...]

“Firms are just responding to incentives,” said Dean Maki, chief United States economist at Barclays Capital. “And capital has gotten much cheaper relative to labor.”

[...]

Corporate profits, meanwhile, are at record highs, and companies are hoarding cash. Many of the companies that are considering hiring say they are scared off by the uncertain future costs of health care and other benefits. But with the blessings of their accountants, these same companies are snatching up cheap, tax-subsidized tractors, computers and other goods.

[...]

Hiring has some hidden costs, as well as the expenses of salary and benefits, Mr. Mishek added.

“I dread the process we have to go through when we want to bring somebody on,” he said. “When we have a job posting these days, we get a flurry of résumés from people who aren’t qualified at all: people with misspellings on their résumés, who have never been in the industry and want a career move from real estate or something. It’s a huge distraction to sort through all those.”

Culling the résumés takes three days. Then he must make time to interview applicants, and spend $150 for each drug test.

Once a worker is hired, that person must complete a federally mandated safety program, which Vista pays an outside contractor a flat fee of $7,000 annually to handle. Finally, Vista’s best employees spend several months training the new hire, reducing their own productivity.

“You don’t have to train machines,” Mr. Mishek observes.

[NYT]