washington business
“We have this disconnect between what stocks are doing and what many
companies are doing and what workers are feeling on the ground, and I think
that that’s particularly something that is felt by small and medium businesses
because they are closer to the ground and they feel these pressures.”
the business model that he’s employing, which is in a sense
a customer service play even more than a technology play, I
think could be used to disrupt almost every business. People
are starting to feel it, industries one by one. If you look at what
you can get on Amazon, it’s not just books, it’s movies, it’s furniture, it’s air conditioners, it’s vacuum cleaners, it’s fashion.
So, it’s hard to think of an industry that won’t get disrupted by
this. And I think it’s going to continue to put downward pressure on profit margins, I think it’s going to force local players
and regional players to become very, very nimble. I think it also
pushes the trend toward bifurcation in all kinds of different
industries that we’ve already seen. Look at the retail sector:
For some time now, the companies that are successful tend to
be at the very low end, they compete on price point — Target,
Walmart, etc. — or at the very high end — Nordstrom, Bergdorf
Goodman, Sak’s Fifth Avenue, you know, that kind of thing. And
that’s because it’s so hard to play in the middle. You’re either
offering the consumer a very high end, very upscale service
that comes with a lot of extras, or you’re offering them price.
And the Internet just makes it so easy and transparent for price
arbitrage to happen that it’s very difficult.
That’s why J.C. Penney has been struggling, because
they operate in that middle ground?
That’s right, that’s a perfect example.
These upheavals of industry are obviously unsettling for
people who work in those industries. But is the overall
effect on the economy good or bad?
There’s actually some good historic data on this. It is fair to say
that technology has always been historically a net job creator,
but that takes time … Generally after a big technology upheaval,
everything from the creation of automotive lines that Henry
Ford was using to the rollout of mainstream television, to almost
any kind of technology you can think, there’s a disruption, jobs
are lost — but then ultimately over a period of about three to
five years, job creation starts back up again as industries adapt,
but also new industries emerge. Think about the mobile phone
industry: That caused a lot of disruption when it first started, but
now there’s this app economy where you’ve got all kinds of small
businesses creating applications for the mobile phone ecosystem. But I think that’s what’s happening now is that we are still
in that period of job disruption, and there are some economists
who say that it may last longer this time around and be harder
to come out of because the Internet is just so all-encompassing.
It just disrupts every kind of business across every industry in
every country, and so that amount of change taken altogether, it
may take us longer to find those new industries and those new
things to create jobs. It’s a painful period, I think.
Like many other business groups and employers, AWB
hoped that Congress would adopt immigration reform
this year. Is there still a chance that could happen? If
not, is there a chance it will come back up soon?
I would have been — and I was a little more optimistic — even
a month or two ago. Given everything that’s happening in the
world right now, and the way in which the president seems to
be having so much trouble pushing his agenda throu