Here's one answer: In the age of globalized profits, all job creation is local.

Reuters

Median household income is in the middle of its worst 12-year period since the Great Depression. David Leonhardt and the New York Times have launched a feature to investigate the hardest question: Why?

I don't know! Or at least, I have no confidence that I understand exactly which issues had exactly what effect on the stagnation. The flat-lining of middle class wages is probably the most important long-term economic story in the United States, and its roots stretch deep into such far-flung themes as how technological changes hurt unions and how the subsidy for employer-provided insurance contributed to escalating health care costs.



When I write about income stagnation apart from the Great Recession, I typically rely on a trio of explanations: Globalization, technology, and health care.



Competition drives down costs. Shoppers understand this, intuitively. One reason that flat-screen TV prices have fallen so much in the last ten years is that so many electronics companies have gotten efficient at making them. Similarly, competition for jobs in tradable goods and services -- manufacturing that could be done in China; retail that's simpler on Amazon -- competes down the price employers pay workers in those industries. It makes many workers borderline-replaceable and nothing borderline-replaceable is expensive. Those forces drove down wages, and employer-side health care costs gnawed at the rest of it.