Robert Reich Explains the Disconnect Between Profits & Jobs

On his blog, which I picked up from, economist Robert Reich dissects the issue of a jobless recovery. He explains why corporate profits are rising in some cases, but still not leading to fresh hiring.  Read his blog post here.

2 Responses to Robert Reich Explains the Disconnect Between Profits & Jobs

  1. C R Krieger says:

    Quoting Mr Reich, “Second, big U.S. businesses are investing their cash in labor-saving technologies.  This boosts their productivity, but not their payrolls.”

    Are these labor-saving technologies free goods?  Do they not generate payrolls?

    What is the trade-off?

    Regards  —  Cliff

  2. JoeS says:

    Of course they are going to invest to reduce their costs. It is only when tax laws make “investment” work overseas better than in the US that there is a problem. If we had the courage to step up and unburden our labor from so many ancilary costs, such as health care, medicare tax, social security tax, etc., labor would have a better chance of winning some of the tradeoffs, whether they be for equipment investment or outsourcing. A progressive tax system including both income taxes and consumption taxes could go a long way to achieving a better balance for labor.