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August 26th, 2009

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10:50 pm - Musings on Work, Employment, the Economy, Farming, and the Future
Here's a fascinating article about automation and unemployment. My one reservation about this article is that it doesn't go far enough. At this point, it's obvious that the future of most unskilled work in the first world is fairly bleak. From automatic checkout in supermarkets to RFIDs being used to keep track of inventory, it's clear that in a few years there will be need for substantially fewer employees for many low-end jobs. Meanwhile, I'm betting that the combination increased automation and the promise tax breaks (or at least a lack of tax penalties) for non-outsourced work will mean that an increasing amount of manufacturing will be done in the US, but it will also be even more automated than it is today. All this is obvious, but what is also looming on the very near horizon is that fact that while an increasing number of low-end white collar jobs are being outsourced, in less than 5 years, others are likely to be replaced by improved phone and office automation. In short, even if outsourcing is reduced, we're likely soon approaching a time where there simply won't be enough jobs for everyone in the first world.

There are a few obvious short-term answers – Germany has mostly reduced full-time work hours to 30 hours a week, with little or no decrease in wages, and much of Western Europe has similar work hours as you can see in the table here, most of Western Europe has work hours that are less than 80% of those in the US, which combined with a mostly EU wide rule prohibiting working more than 48 hours/week, serves to maximize the number of people who are employed. Of course, over time if a nation wishes to maintain something like full employment, the number of hours worked will need to further decrease. I suspect that this will prove easier in the EU than in the US, obsessed as our culture is with problematic ideas like "work ethic" and the even more toxic celebration of being a workaholic. I made a previous post about this 6 years ago, and it seems like the current economic problems are likely to accelerate these trends.

In any case, here's a fascinating article imagining three different future possibilities for the economy. There is also a follow-up article looking at the three versions in greater depth.

I don't know if either Just-in-Time Socialism or Robonomics are likely or even feasible possibilities in 10 or 20 years, but they both seem vastly superior to the current way first world economies work. Of course, the way the EU economy works seems vastly superior to the way the US economy works, so there's a truly vast amount of room for improvement in this rather backwards nation.

On a somewhat related note, here's yet another article on the idea of vertical urban farming. I made a
post about this idea two years ago, and it looks like there's an organization pushing the concept. Saving water, land and transport costs, while also arranging farms in a manner that allows them to be more fully automated sounds both like an excellent idea and one that fits well into the more hopeful visions of the future. I suspect many people will mourn or even loudly decry the idea of rural areas being abandoned to return to wilderness areas as the human population becomes even more urban than it already is and even food production becomes an urban endeavor, but I will celebrate the idea.
Current Mood: hopefulhopeful

(8 comments | Leave a comment)


[User Picture]
Date:August 27th, 2009 02:57 pm (UTC)

The worst-case scenario

I can see the following scenario happening in the US:

Automation forces so many people out of work that the US cuts the working week to 32 hours a week by law to prevent further job loss. However, hourly wages decrease, because the corporations hold the threat of job loss over Americans' heads until collective bargaining is only a memory. Millions of people die due to starvation and homelessness, because they no longer earn enough money to live.

At the same time, diabetes and heart disease rates would go down, because people would have less to eat. Most people would lose massive amounts of weight. Fasting is encouraged by the government as the key to good health.

The attitude of the rest of the populace? "Oh, they deserved it, and look how good the environment is now that the excess people have been weeded out! And we're all so thin! Yay!"

[User Picture]
Date:August 27th, 2009 03:44 pm (UTC)


At the same time, diabetes and heart disease rates would go down, because people would have less to eat.

...we've already more than proven that low-income individuals in this country have higher incidents of diabetes and heart disease. This is generally true because (current, heavily automated) agrobusiness/industry, through federal subsidy lobbied into continuance, provides carb- and fat-heavy 'empty' calories at a fraction of the cost of nutritional food.
[User Picture]
Date:August 27th, 2009 03:33 pm (UTC)
Well, there's a lot more I want to learn before I claim to say anything definitive about the subject, but for now I'll just add this:

In 1960, America employed about 54.3 million people (that's non-farm payroll employment reported by the BLS for the footnote-wanting crowd). There followed about a half-century of intensive automation and productivity improvement, more-or-less simultaneous with the emergence of big industrialized exporters in formerly less developed countries (beginning with Japan and South Korea, then Mexico, Brazil, Argentina, then countries like China and India). And after almost fifty years of automation, import competition, and outsourcing, America in 2008 employed 137 million people, two and a half times as many as in 1960.

And every new technology and every reduction in barriers to trade has been reviled as a job killer. My question is: do we ever get tired of being wrong? :-)

Another recurring theme is the "But what will people do? In what industry, in what occupation will they possibly find new jobs?" This is what's behind my skepticism of socialism in general: it turns out that millions and millions of people are better at answering that question by trial and error than am I, or anyone I imagine sitting in offices trying to draft blueprints for the economy of the future. (It's also why I'm a "social safety net liberal" -- being wedded to trial-and-error economic development, I think it's wise to ameliorate the impact of the inevitable errors!)

That said, the often overlooked moral of the story of the boy who cried wolf is that, sometimes, the wolf is real.
[User Picture]
Date:August 27th, 2009 07:21 pm (UTC)
Fair enough, and all of these predictions of future work (or lack thereof) might well be wrong. What the data indicates is that from the 1960s onwards, we had a huge move from manufacturing to both service and office work - some of which is now being outsourced, and much of the rest is starting to get automated. That does seriously call into question where will people work, but like so much in the future, the answer could well be something we would not in the least expect.
[User Picture]
Date:August 29th, 2009 09:29 pm (UTC)
Alternate story: the post-2001 period never really got out of 'real' recession, and the apparent growth of GDP was fueled by real estate bubble and financial shenanigans, with us never reaching full employment not because of automation issues but because of behind-the-scenes Keynesian issues that were being papered over.

I'm not entirely certain that makes sense... but I also note the first article is resting largely on that period, in one country (the US). Which is not a strong evidence base to rest on.
[User Picture]
Date:August 29th, 2009 09:38 pm (UTC)
Resilience Economics... Con: Less profitable than current model when current model is working well.

Not clear that's true. The post-war New Deal period was the greatest period of long-term growth for the US; the Reaganomics period has seen slower growth overall and stagnation for the majority. Of course, there are other factors, like still adopting Industrial tech and how messed up the postwar world was. But still, it's not clear that Resilience is less profitable, as opposed to being less profitable for the upper classes who captured government in the Reagan era.

*reads* Ok, Resilience is supposed to be something newer and vaguer. But I'd start with going back to postwar economics. Maybe add something like: for every doubling in income, tax goes up a bit. More graduated than the current income tax... and perhaps giving a disincentive for corporate mergers for the sake of it, as the combined income of two equal companies is taxed higher. Not clear that that'd be less profitable: real economies of scale would still happen (and get taxed); predatory mergers would be discouraged, keeping diversity and market efficiency up.
[User Picture]
Date:September 3rd, 2009 05:49 pm (UTC)
I like this, to a certain extent. I think that humans should be used for precisely two kinds of labor:
(1) Things that only humans can do;
(2) Things that individual humans want to do.

Everything else, automated. If you want to handcraft, say, chairs - good for you! Go for it! You're an artisan. Basically, human labor should be enriching, not toil - the further we can go towards eliminating drudgery, the better (keeping in mind that (2) is there because personal definitions vary).
[User Picture]
Date:September 3rd, 2009 06:57 pm (UTC)
I completely and absolutely agree.

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