Governor Schafer expressed the belief that as demand for the state s labor force increased, the state would be able to turn its attention to trying to create higher paying jobs. It s the next step, once you get the ball rolling. Many communities have since specified mechanical job targets intended to heat up local labor markets by increasing overall employment. The ultimate hope is to raise wages. Yet, it is theoretically just about impossible to make progress this way.
Economic policy is reduced to a numbers game, that ignores some basics of labor economics.
The state is targeting occupations in the lowest end of the business services industry. The services these occupations are involved with producing and distributing are usually related to very competitive product markets. These occupations make up the kind of low-skilled jobs which are easily substituted with even lower wage labor. The capital associated with these jobs tends to be very mobile, associated transportation costs are absolutely minimal. Production is labor intensive, not capital intensive.