The debate of whether or not globalization is good or bad for the economy and for business has been raging for years now. It’s time to weigh in with your opinions and thoughts.
Is global trade good or bad for the economy? Is global trade good or bad for your business? The public opinions on this topic vary dramatically, which is why the conversation continues.
A recent poll published by the Allstate/National Journal Heartland Monitor http://bit.ly/gziJLY reflected the views held by 1,200 Americans of our nation’s standing in the global economy, and summarized the answers to the same questions above. The chart depicts how universally divided the responses are on the pros and cons of international trade.
What does this mean?
Simply put … it points out that globalization is viewed as either good or bad depending on your particular situation. For example, if you are in an emerging growth industry, globalization represents a significant opportunity to access broader geographic markets, to accelerate growth and expand your business. However, if your business is in an industry that has imploded due to the onslaught of global competition, or you have suffered a job or income loss as a result of downsizing and/or outsourcing, you probably have a very negative view of the prospects of further globalization.
Additional charts from the same Heartland Monitor poll reflect the respondents’ views of the countries with the strongest economy’s and quality of services crucial to economic development and growth – i.e. Education, Science and Research, Workforce, etc. The responses were a little surprising in the area of strongest economy, because the poll results were published around the time world economic data was released showing that the E.U. had replaced the U.S. as the #1 global economy, followed by the U.S., China, India, Russia and Japan.
Further, in a recent 60 Minutes segment on the resurgence of Brazil’s economy, the emerging super-powers that were discussed included China, India, Russia and Brazil. The United States was not in the conversation. Was this just an oversight, or does it point to growing sentiment and a more significant challenge ahead of us in competing in the rapidly changing global economy?
On the quality aspect, the U.S. came out much better in the poll compared with other countries in all but the last category, Elementary and Secondary Education. But don’t get too excited about the responses here. In my opinion, the results reflect a false positive when you consider the following challenges and how they will ultimately affect quality in the categories represented by the Heartland Monitor poll …
1. 55% of the current U.S. labor force is 40+ years old.
2. 78 million Baby Boomers will exit the work force in the next two decades.
3. $14 trillion national debt burden.
4. Declining high school graduation rates.
What is our succession plan to replace this experience, knowledge, skilled labor and leadership? With graduation rates less than 50% in some high schools today, where will the skilled labor, expertise and corporate leadership required in the future come from? And how will the anticipated skilled labor and leadership shortage affect the quality of life for future generations and our competitive position in the global market?
Will the U.S. stay ahead of other developed countries in quality and continue to invest appropriately in education and in other areas critical to stimulating economic growth and development in the future, given our rising national debt? The remaining articles in this series on Globalization: The Leadership Challenge Ahead will provide more insights into these global business opportunities and challenges.
If global trade is bad for the economy and bad for your business, is it reversible? Hardly, that horse left the barn a long time ago and is not coming back! As business leaders rather than debating whether globalization is good or bad for business, we should shift our attention to the following, “What are the implications of further globalization to my business?” And “How do I prepare my business for greater success in the ‘New World’ economy?”
Please let me hear from you your on this topic. How has globalization has affected your business? What steps you are taking to remain competitive in the rapidly changing global economy?
COPYRIGHT © 2011 John Carroll