Andy Grove on How to Create American Jobs

In the wake of this week’s jobs report, here is a Businessweek article from the July 1, 2010 in which Andy Grove, lays out a path to American economic renewal. If anyone has the chops for this, it’s Grove.  One of the three founders of Intel, he helped light the fire that gave us Silicon Valley and changed the world.

(l-r), Andy Grove, Robert Noyce, and Gordon Moore in 1978, on the 10th anniversary of Intel. Photo courtesy of Intel

The bad news is that Grove’s formula depends on intelligent and focused government action. In 2010, that didn’t seem as hopeless as it does now.  Yet perhaps ideas are like seeds; the good ones grow, even though they may take a while to germinate.

One key problem, according to Grove, is our loss of hi-tech manufacturing jobs, not only because of the human cost, but because of our loss of the expertise that production brings.  He says the US has already fallen too far behind to ever catch up in technologies like solar panels and batteries for fuel efficient cars.  “Not only [do] we lose an untold number of jobs, we [break] the chain of experience that is so important in technological evolution. As happened with batteries, abandoning today’s “commodity” manufacturing can lock you out of tomorrow’s emerging industry.”

Grove suggests we need an employment-centered economy and political leadership.  He cites the performance of several Asian economies, including China, the source of so much hand-wringing in the face of perceived U.S. decline.

Andy Grove, 2010

Grove recommends government incentives to aid the growth of key industries and keep the manufacturing base at home. He ends the article with a chilling bit of history:

Most Americans probably aren’t aware that there was a time in this country when tanks and cavalry were massed on Pennsylvania Avenue to chase away the unemployed. It was 1932; thousands of jobless veterans were demonstrating outside the White House. Soldiers with fixed bayonets and live ammunition moved in on them, and herded them away from the White House. In America! Unemployment is corrosive. If what I’m suggesting sounds protectionist, so be it.

I suggest everyone concerned with employment and US technical expertise take a moment to read what Grove has to say:  http://www.businessweek.com/magazine/content/10_28/b4186048358596.htm

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3 Responses to Andy Grove on How to Create American Jobs

  1. Glimpse of my heart says:

    Reblogged this on ifeperita.

    Like

  2. Rosi says:

    The phrase “intelligent and focused government action” is oxymoronic at best. I’m not sure I can buy into government incentives after what we’ve seen of recent such incentives. But I agree that if anyone would understand ways to move job creation along, it would be Andy Grove. He’s nothing short of brilliant.

    Like

    • (I previously replied to this on the wrong thread).

      Grove was CEO during most of the quarter century I worked at Intel, and one of his lessons seems very pertinent now.

      The semiconductor industry seemed to go through four year boom/bust cycles, regardless of what the rest of the economy was doing. It makes sense when you reflect that 4 years is the maximum life of a lot of corporate tech assets – cellphones, laptops, servers older than that are dinosaurs.

      Some of those troughs were difficult, with reduced pay or layoffs but Grove always insisted, “You can’t save your way out of a recession.” Those were the times Intel invested in fabrication equipment, retooling plants, etc, so they always came out of the downturns strong. I believe the principle applies to the wider economy too.

      Like

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