The Workweek: A Round-Up of Labor Market Links for the Week Ending 6/23/17

This week’s labor market news on the future of the cashier, automotive manufacturing and rent-seeking behavior.

Welcome back to The Workweek, the Indeed Hiring Lab’s round-up of the latest research, news, and perspectives that made us think deeply or differently about the labor market this week. It’s your guide to the most important new insights about work.

Here are our picks for this week:

Amazon goes full brick and mortar

Amazon’s $13.4 purchase of Whole Foods made headlines last week, a move that could show the writing on the wall for about 8 million Americans currently working as retail salespeople and cashiers. The discussion around automation typically focuses on manufacturing and transportation. Lost in the shuffle are many service sector jobs that feature routine tasks easily performed by machines. Amazon is a company at the leading edge of technological innovation. Its purchase of a major grocery chain could mean big changes for the traditional grocery business model and its employees. [New York Times]

A stalling auto industry is bad news for manufacturing

After climbing out of the ditch during the Great Recession, the US auto industry has notched nearly a decade of strong growth. However, that momentum appears to be winding down as most major US automakers in recent months have announced plans for significant layoffs. Mark Muro of The Brookings Institution says this is a major blow to manufacturing overall, with big repercussions in some regions of the country and for politicians who promised to bring manufacturing back to America. [The Brookings Institution]

Training workers for a lifetime in the labor market  

For ideas on how to better prepare youth for the US labor market, many observers point to the largely successful German apprenticeship model in which students spend two-to-three years after high school working and learning a trade. Eric A. Hanushek says this would be difficult to implement in the US and points to a bigger problem that probably wouldn’t be solved by improving apprenticeship. He argues that the US labor market’s biggest need is a way to teach general cognitive skills that would enable workers to learn new skills as emerging technologies dramatically change the nature of work. [Wall Street Journal]

The debate over the skills gap continues

The US Bureau of Labor Statistics reports that, as of April, there were about 6 million job openings in the nation. Some unfilled jobs are normal in the labor market. But many analysts point to these vacancies as evidence of a skills gap in which many work slots remain unfilled because workers lack the proper training. This argument raises many questions, including why haven’t employers increased wages to attract the skilled workers they need? Pedro da Costa of Business Insider highlights some recent commentary on the skills gap and why claims of the gap’s existence shouldn’t be taken at face value. [Business Insider]

Why the big guys always win

A fall in economic dynamism, and more specifically new business creation, has become a major concern for economists. One possible contributing factor is business pursuit of rents, an economic term describing the ability of some companies to make money without producing anything of value. Rents come in many forms, such as lawsuits against other companies to stifle competition, subsidies from local governments, and favorable regulation. Noah Smith explains how this rent-seeking behavior is contributing to declining economic dynamism, which means fewer new companies, fewer products brought to market and muted job creation. [Bloomberg]