Companies Spend on Equipment, Not Workers

This is very interesting. It seems as if this would have an adverse affect on the unemployment numbers. I would venture to say that the investment in equipment is why companies are failing. There has to be an equal level of investment. The investment in people should drive the investment in equipment.

Companies that are looking for a good deal aren’t seeing one in new workers.

Workers are getting more expensive while equipment is getting cheaper, and the combination is encouraging companies to spend on machines rather than people.

“I want to have as few people touching our products as possible,” said Dan Mishek, managing director of Vista Technologies in Vadnais Heights, Minn. “Everything should be as automated as it can be. We just can’t afford to compete with countries like China on labor costs, especially when workers are getting even more expensive.”

Vista, which makes plastic products for equipment manufacturers, spent $450,000 on new technology last year. During the same period, it hired just two new workers, whose combined annual salary and benefits are $160,000.

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