Creating More Local Jobs

Globalisation has changed the world in recent decades and been responsible for the relocation of many thousands of jobs to lower cost locations around the world.

In the next few years there may be a change in the trend as developments in technology and higher transport and energy costs are creating the need for companies to develop a local presence once again.

In addition, the increasing level of global political uncertainty and associated security risks undermines the reliability of complex supply chains.

The view of globalisation until recently was that of shifting local jobs to overseas locations, as the benefits of emerging nations with lower costs provided competitive advantage.

To the surprise of many people low cost wage economies are becoming less attractive than a mix of highly skilled operators and robotics located in the home market.

There is also a downward trend in the likely global growth rate from 4% to 2%, which gives an indication of what the ‘new normal’ may look like in the years ahead.

In the context of the globalisation agenda, such changes highlight a number of issues:

– a greater focus on rebuilding the economy by creating local jobs and less reliance on global growth to solve our economic problems

– the dominance of finance within the economy will reduce as banking reverts to its more traditional role of providing support to local businesses

– manufacturing will regain its importance and generate more local jobs as it exports products around the world

– the use of robotics in manufacturing coupled with high-skilled technicians will reduce the need for companies to move overseas for cheap labour

– the concern of companies about supply-chain security will increase and shorter product life cycles will make ‘just-in-time’ supply chains increasingly attractive

An unfortunate side effect of these developments will be the creation of a surplus of low-skilled workers and a shortage of high-skilled workers around the world.

As a result, the need for the education system to address the mismatch between what is taught and what is needed in the workplace will significantly increase.

SO, globalisation’s effect of moving jobs to overseas locations is loosing its appeal, as the benefits of local jobs become more attractive.

What do you think? Can more local jobs be created? Get in touch, we would love to hear your views contact Nick on 028 8224 9494 or via Twitter @nick_oec.