The real structural problem of the American labour market can’t be seen close up, so let’s take a few steps back and look at the productivity trap the USA is currently in and the price that Americans are paying right now for technological progress.
Moving the factories of the biggest international corporations to cheap labour China, and more recently increasingly to India or Indonesia, isn’t a new phenomenon or one that can be solely observed in the American economy. In the XIX century David Ricardo described his theory of comparative advantage, which states that countries should specialise in the areas where they fare better than others. In the recent decade the United States has taken advantage of increasing globalisation and capital mobility and focused on building an economy based on knowledge, services and new technologies, while production was gradually shifted to countries which could more easily achieve economies of scale. The value added to the economy as a result of a month’s work of a programmer or lawyer is usually higher than that of a car factory worker. In short we can say that the USA is betting on trading intellectual capital for goods produced abroad. As opposed to a factory, whose opening requires large outlays of capital and labour (building the factory, resources, etc.), creating a new job in Silicon Valley involves a minimum amount of labour in comparison to the financial benefits.