It’s a major cultural shift that economists and the president warn is bad for the economy. Talented workers need to be in places and companies where they can really thrive.
Too many people are living in places where they “can’t get jobs,” the president said. He singled out Upstate New York, but there are plenty of other areas that have far worse rates of unemployment, like southern Ohio or eastern Kentucky. It would probably be better for those folks – and the U.S. economy – if they moved to areas where help-wanted signs are plentiful.
The lack of mobility helps explain why the U.S. economy isn’t growing at the “great” levels of the past, says economist Tyler Cowen. He published a book earlier this year that got a lot of people talking called “The Complacent Class: The Self-Defeating Quest for the American Dream.”
Cowen thinks one of the biggest problems is that Americans aren’t taking enough risks anymore. They aren’t even willing to move for opportunities. It’s particularly startling that people are staying put all across the age spectrum. This trend can’t be blamed solely on baby boomers or millennials.
For Trump, one of his biggest concerns is his base: struggling blue-collar workers. He wants to bring jobs back for them, but even if he’s successful, the jobs might not come back to the same towns. LinkedIn, a popular jobs site, has found that demand for manufacturing skills is currently strong along the coasts but not in the Midwest. It implies the United States might need a 21st-century migration.
“Manufacturing workers who are having a hard time finding a gig in Cleveland, Detroit or Minneapolis may want to consider looking for jobs on the coasts,” LinkedIn wrote in its Workforce Report in May.
Jed Kolko, chief economist at jobs website Indeed.com, warns that there is a lot of variation in manufacturing jobs. It's not like working at McDonald's. “Just because you worked in one sector like textiles or auto manufacturing doesn’t mean you can easily transfer to something else.”
The president told the Wall Street Journal that he was going to do a PR campaign to encourage Americans to look further afield for jobs. “I’m going to explain you can leave, it’s okay,” he said.
There’s a huge debate about why people aren’t moving. Trump blames people’s attachment to their homes.
“You know, a lot of them don’t leave because of their house. Because they say, ‘gee, my house, I thought it was worth $70,000, and now it’s worth nothing.’ ” Trump said, but he plans to tell people, “It’s okay. Go, cut your losses, right?”
That might be easy for a billionaire like Trump to say. Losing one abode wouldn’t leave him homeless. It’s a lot more complicated for the bottom half of Americans who earn about $55,000 — or less. Consider a manufacturing worker in Ohio considering moving to a big city on the East or West Coast. He or she wouldn’t even be able to find a home for $70,000. And if they lose money on the place they left behind, it only makes the move a harder financial leap.
“Lots of factors enter into this lack of mobility. Housing costs are just one,” says Kolko of Indeed.com. He also points out that many licenses that are needed to work in a hair salon or be a real estate agent are tied to one state. They don’t transfer easily. There are also cultural differences between parts of the country and ties to families and friends that keep people in place.
The Wall Street Journal ran an article Thursday on why rural Americans are “stuck in fading towns.” The reporters found that what people talked about most was a desire to be around others who think as they do. “Beyond the practical difficulties, rural residents and experts say there is another impediment to mobility that is often more difficult to overcome — the growing cultural divide,” the article said. A young woman in the article tried to move away from her small town several times, but she found many larger cities to be godless places where people were quick to have sex with strangers, but they didn't want to know their neighbors.
In January, I spent several days in Lordstown, Ohio, interviewing workers about to lose their jobs at a GM factory that makes the Chevy Cruze. About 1,200 lost their job the day that Trump took office. Many of the workers I spoke with were younger than 45. I asked them why they didn’t just move somewhere else in America. The most common response was family. One worker was divorced. If he left the state, he would probably never see his kids. Another worker was caring for an uncle with a major health issue.
Trump is optimistic that he can reverse the mobility decline. Americans are “going to move to Colorado, and they’re going to move to Iowa and Wisconsin,” he predicted in his interview. But it may take a lot more than job postings to make it happen.