Sector analysts offer talk about cyclical, structural, and technological factors that are weighing on job growth.
Most investors have a very good idea what cyclical factors are: they relate to the business cycle, and the demand for labor that increases and decreases with the pace of economic activity. Construction jobs in the housing sector represent a good example of a cyclical sector and cyclical jobs.
Meanwhile, globalization, basically the transfer of U.S. jobs to lower-cost production centers overseas, is perhaps the best example of a structural factor. It's hard to find a U.S. manufacturing category that hasn't lost jobs - or been eliminated - by globalization, particularly the loss of jobs to China. China's cost structure is so advantageous that even Mexico is losing jobs to China.
Technological factors, however, are not as easy to identify, but here in New York, we have many examples concerning how technology is eliminating jobs. A classic example: co-op and condominium complex doormen are being replaced by virtual doormen.
Instead of having Carlton as your doorman, cameras and other electronic equipment enable an off-site company to monitor several buildings at once electronically, cutting building maintenance costs in the process. I visited one such complex on Manhattan's East Side over the weekend while attending a birthday party.
Personally, I prefer a regular doorman to watch my residential building, but one can see where the technology-enabled future is pointing.
Financial Editor Joseph Lazzaro is based in New York.
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