Another reason the unemployment rate is still so high

Companies are spending money on equipment, not workers. Truth is, it's just cheaper and more efficient. From the NYT:

"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.

Since the end of the recession, spending on employees has risen by 2 percent. During that same period, spending on equipment and software has risen 26 percent. See the problem?

Indeed, equipment and software prices have dipped 2.4 percent since the recovery began, thanks largely to foreign manufacturing. Labor costs, on the other hand, have risen 6.7 percent, according to the Labor Department. The rising compensation costs are driven in large part by costlier health care benefits, so those lucky workers who do have jobs do not exactly feel richer.