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Less Energy = Fewer Jobs

A few days ago Bloomberg posted a revealing article titled ‘Great Recession’ Will Redefine Full Employment as Jobs Vanish. This is a good read because it shows how economists and policymakers are now admitting that — even if there is a “recovery” — many of those lost jobs are lost forever. However, no one is making the connection, at least openly, between energy and rising unemployment. The bottom line is, there is no longer enough cheap energy in the world to bring employment back up to the previous level. Of course the world didn’t have full employment in the literal sense of the word, because there have always been unemployed people looking for work. It was just more or less held down to manageable levels until now, thanks to plenty of cheap energy and the economic growth it engendered.

We are entering a new phase. Last I checked, the world population was still growing, and economists and politicos were prattling on about how we need continued economic growth to find jobs for all the new people appearing on the job market. But with overall economic contraction now a certainty, finding jobs for all the new job-seekers is a definite impossibility because they are competing with an even greater number of unemployed for a shrinking job pie.

That reminds me of a recent post I did on the Japanese government paying foreign workers to go home. Here is a concrete example of how an industrial government understands that the future holds fewer jobs. Certainly, that is why the Japanese government attached the “don’t-come-back” condition to the payoffs.

It’s no wonder that governments are expressing grave concerns about industrial unrest brewing around the world. Soon enough, probably this year or next, the cup will runneth over and the situation will get very ugly. Peak oil means peak everything, and that includes peak jobs.