Well, not exactly all of America’s anger but certainly some of it. The chart below shows that for those born in 1940 there was a 90% chance on average that you would end up with a higher standard of living than your parents. But for those born in 1980, the chance is down to only 50%. Many Americans are worried and angry about this.
This does not mean that Americans aren’t living an affluent life. On average we certainly are, but we are not increasing our wealth generation to generation as rapidly. Many young people today, probably 30% or even 50% will do extremely well in the global world. Our young people have talent, education and flexibility. But a recent headline in The New York Times International edition summed up the problem, “Wanted: factory workers, degree required.” Siemens USA makes gas turbines and other high tech manufactured products in the U.S. The recently retired President of Siemens USA said, “In our factory there is a computer about every 20 or 30 feet.” If you want a good job today, you had better acquire big time skills.
And the ante keeps going up. U.S. manufacturing is a powerful machine. We make 85% more goods today than we did in 1987 but we do it with only two-thirds the number of workers (The New York Times). Computers, robots and just doing things smarter are the secret. And where do all the top robots come from today? Right now the best are from Japan and Germany. But China is catching up fast. And the U.S.? We are leading the way in surgical robots and we have world class university research (places like Carnegie Mellon) but we are losing the race in high volume, manufacturing robots.
The moral of this story is first, if you want a chance at a higher standard of living you had better get World Class skills and be willing to refresh these often during your career; and if as a country we want to increase wealth we had better target not low-end cars coming in from Mexico, but the world-beating technologies of the future.