Great post Sarah, really enjoyed reading it! Although we can see the effects on LFP’s operation (part change in immigration laws, part e-verify agency bad practices), I think we should really think about how restricting immigrant workers can affect the US economy. There are many benefits to the US economy that come from its immigrant population. According to this Bloomberg article (https://www.bloomberg.com/view/articles/2017-03-24/immigrants-are-making-the-u-s-economy-stronger) a continuous flow of immigrants can help support the growing retiree population and add to formation new businesses. Also, many studies have found no correlation between low-skill immigration on wages of the local population, which seems to be the main concern of this new legislation.
Looking into the LFP case, the economic cost of losing 25% of their workers overnight is enormous. I fail to see how these new immigration laws are helping businesses, consumers or even native-born workers. As per their action plan, I agree that training lower-skill workers, increasing salary and switching e-verify agencies is the way to go. Given that these actions might not be enough I would look into more flexible schedules to attract part-time employees or students and a relocation program to attract workers from areas with high unemployment. As a local government official in this region, I would also be worried about the impact of these 25% newly unemployed people who are going to have a tough time finding another job. Would this lead to lower economic growth rates, tax revenues or even crime?
Chris, really great post! It’s interesting how after many decades of US companies outsourcing production to developed markets and maintaining an open trade economy the trend seems to be reversing. Coming from a country that has tried very severy isolationism policies in the 1970-80s I believe that this always comes at a high cost. In open and efficient markets production is allocated to those countries who have a cost advantage in the development products or services. Moving production of the iPhone and other Apple products to the US would not only face a performance gap (which I believe can be breached with some effort) but it will very possibly face higher costs.
Producing Apple products while maintaining the same level of quality would imply higher labor costs as well as huge investments to expand production capacity in the US. While in the short term, this can bring money into the US economy, there are several drawbacks. First, Apple (which faces intense competition) would be at a disadvantage with other players like Samsung. Higher costs of production can have a huge impact on what is today the 2nd biggest company in the world (by market cap). If the US government decided to restrict imports, so that Apple wouldn’t have to compete with international players, this would lead to higher consumer prices in the US and potentially similar restrictions for other US companies abroad.
Even if isolationism can indeed bring back manufacturing jobs to the US, its overall impact can be very negative. At the end of the day, someone has to bear the cost of the reduction in efficiency caused by these policies. In 1970-80s in Peru (although policies were much more aggressive than what we are seeing in the US today) this led to a very inefficient manufacturing industry that provided low-quality products at very high prices for consumers. In this case, ultimately consumers ended up bearing the cost of these policies. When the economy was opened up in the 1990s many of these inefficient companies went bankrupt due to international competition. Ultimately more jobs and economic prosperity was generated by focusing on industries in which Peru was competitive. Let’s hope that the wide range of examples of the negative effects of these policies are being taken into account in new legislation.
Really interesting post Sarah! One point I found very interesting (in this article and a few others) is how companies and governments tend to invest in projects to mitigate the impact of climate change on their operations. Initiatives, like the ones you mentioned (e.g. move coffee bean growers to higher altitudes, develop new coffee bean varieties) tend to help in the short and medium term, but at least in my opinion are not enough to solve the problem.
Given the size of Starbucks operations, I think reducing the company’s carbon footprint, informing their customer base of the effects of climate change and pressuring the government to implement stricter regulations on greenhouse gas emissions can have a great impact. From your article, you can see that they have made progress in the first two but not on the last one. Unless Starbucks and other private companies can lobby for regulation that would reduce carbon emissions, it’s going to be and uphill battle.
Great read Sahel! I think your post clearly states the consequences of implementing digital initiatives without considering the broader implications to the supply chain. Just introducing mobile ordering in Starbucks stores proved to be a very inefficient strategy. Companies should look at digitalization not as an add-on to their current business model, but as an integral part of it. In your article, you can see how Starbucks seems to have overlooked the impact of a higher number of orders which produced longer waiting times for traditional customers. On that subject here is an interesting HBR article (https://hbr.org/2017/07/6-digital-strategies-and-why-some-work-better-than-others) that talks about how digital strategies need to be transformational and not just a bundle of cost-cutting initiatives.
Really interesting post Angel! Although advancements in automation and technology can have a great impact on reducing costs, as you mentioned we should consider how is the job market going to be affected. According to this Economist article (https://www.economist.com/news/special-report/21700758-will-smarter-machines-cause-mass-unemployment-automation-and-anxiety) 47% of workers in the US have jobs that are at high risk of potential automation. The solution here is clearly not imposing restrictions on automation, but to build programs to train and relocate displaced workers. As a private company, I think Amazon should help train and relocate its warehouse workers to avoid increased unemployment. In the end, as it has happened in the past, automation translated into benefits for society as the cost of products and services (and subsequentially price) are reduced and the workforce moves into jobs that are not yet automated. However, the transition period can be particularly painful for the displaced employees.
Really interesting post about a tangible effect of climate change in a major city. Even though I think that tactical solutions like raising city blocks and installing water pumps are steps in the right direction, I fear that will not be enough. According to this Time magazine article (http://time.com/4932565/hurricane-irma-miami-beach/), scientists and engineers are skeptical that building infrastructure to fend against rising sea levels is the right solution. They doubt that in the long run, it’s feasible given the high cost that would imply protecting the city given that its foundation is made out of porous limestone, which allows rising water to enter city blocks. In the end, if efforts are not made to reduce greenhouse gas emissions this will only be a temporary solution.
Really interesting post! I continue to be amazed by how technology is reshaping the transportation industry. Even if at its current stage the Zipline program might seem like a small part in solving a systematic healthcare problem in East Africa, it has the potential save many lives. In many developed countries, investing in transportation infrastructure to connect small villages and towns is not economically viable. The Zipline program can circumvent these infrastructure gaps and reach people that can’t be reached by traditional methods. Even though I think this is an interesting prospect, I think there are two main problems that need to be fixed. First, the 45 miles range as you mentioned limits drastically the number of people that can be reached. Developing new models with higher ranges should be a priority for Zipline. Second, delivering medicine it’s not enough to solve the healthcare problems in East Africa. There should be a program in place that complements this with a network of healthcare facilities that leverage other technological advancements like telemedicine.