Since the early 90s there has been quite a bit of change in the world economy. This change can be seen in how countries interact with one another, how many Third World countries are coming out of poverty, and the general shift in how work is being done. In this article multiple ways in which the world economy has changed will be examined, both for the good and the bad.
One of the biggest signs that the world economy is shifting is the way in which Third World countries, such as China and India, have come out of near poverty to become major influences within the world economy. They have quickly surpassed such major economies as France, the United Kingdom, and Germany to become major powers, and have a major influence over the money in the world. These countries, once known for mediocre products and an overabundance of people, are now producing many of the world's major brands and shipping them throughout the world. India is producing top-notch engineers, IT professionals, and business professionals at an astounding rate.
While these countries are thriving, other countries are still continuing their battle to just simply get by. These impoverished nations struggle to provide food, water, and basic essentials such as schooling to their population. It is true that the rich keep getting richer and the poor keep getting poorer. Unfortunately for these nations their struggle may continue for decades to come.
One of the largest shifts that we see here in the United States is a transition away from "normal" jobs such as mining, manufacturing, and farming. These industries, once a stronghold in the United States, have largely been outsourced, or were taken over by major corporations that have reduced much of the major workforce in these industries. Knowledge work, such as banking, finance, technical computer programming, account management, and high-level engineering are all much more valued in the United States. This is in stark contrast to what the United States was built on in prior centuries.
Another sign of the changing economy is how integrated much of the world is. A person in the United States can now easily contact somebody in India, China, or Romania and outsource much of the work that would normally be done by that individual. High-speed Internet and faster computers have both contributed to this factor. As the Internet and computer speeds continue to increase, so too will the world's interaction. While many normal individuals will not see this change, large corporations are taking advantage of these operations now.
Another major change in the world economy has just manifested itself. With the downgrading of the United States credit rating by the S&P, many countries will reevaluate their current partnership with the United States. Although most may not change their current relationship, there may yet be ripples that will affect many countries, including the United States in the decades to come. With a chink in the United States armor, there is a greater possibility that other countries will step up and attempt to lead the world.
It is reported that 8.75 million jobs were lost during the recession. These jobs mostly paid moderate to high salaries and wages. One example, talked about in a recent article, stated that a woman who had earned an hour as a health department caseworker lost her job and is now working for an hour in an after school program. Her husband, who had a ,000 a year job, was laid off and is currently unemployed. There are literally millions of stories like this and the real devastation will probably play out for decades to come. Consumer spending accounts for 70% of the U.S. economy and with little chance of regaining these decent paying jobs, consumer spending will probably dip lower than it already is. In the face of data such as this, a quick recovery of the U.S. economy is unlikely. This represents just one of the signs of a changing world economy and one can wonder if this is temporary or a permanent leveling of the world economy field.
We must continually stay vigilant in this ever-changing world and remember that we must adapt to whatever situation may present its self. Written by John F Smalley