What Do Ireland and GM Have in Common?

In the New Yorker, Malcolm Gladwell looks at the dependency ratio, how many people are supported by your current work force. It works for companies and countries:

A second common assumption is that fading industrial giants like G.M. and Bethlehem are victims of their own managerial incompetence. In various ways, they undoubtedly are. But, with respect to the staggering burden of benefit obligations, what got them in trouble isn’t what they did wrong; it is what they did right. They got in trouble in the nineteen-nineties because they were around in the nineteen-fifties—and survived to pay for the retirement of the workers they hired forty years ago. They got in trouble because they innovated, and became more efficient in their use of labor.

Posted by on August 23rd, 2006 at 9:31 am


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