Bread & Circuses

What Does The Future Of 'Work' Look Like?

I don't know if anybody's really pointed out the problem with the drive for productivity in this country, but basically, the increase in productivity is subtracting jobs faster, the more efficient we become. It's pretty apparent when you watch something like 'Mad Men' and the pool of secretaries they used to have that got replaced by computers, that simple jobs are going to be swept away by technology at an ever increasing rate.

Somebody did some sums over in America and it turns out that the man-hours worked in 1998 and 2013 were essentially the same, but produced so much more GDP. The problem was that there were 40 million more people in the pool of workers.:

Martin Ford explained, "In 1998, workers in the US business sector put in a total of 194 billion hours of labor. A decade and a half later, in 2013, the value of the goods and services produced by American businesses had grown by about $3.5 trillion after adjusting for inflation - a 42 percent increase in output. The total amount of human labor required to accomplish that was...194 billion hours. Shawn Sprague, the BLS economist who prepared the report, noted that 'this means that there was ultimately no growth at all in the number of hours worked over this 15-year-period, despite the fact that the US population gained over 40 million people during that time, and despite the fact that there were over thousands of new businesses established during that time.'"

That brown line plateau on the right is essentially the 21st century where productivity keeps growing while private employment has plateau-ed in America. When you consider that America used to be a manufacturing powerhouse but shipped all of its menial manufacturing jobs overseas to China, you get the picture that there really isn't enough work to go around already, and there's going be even less. Which explains the serious anger in some underprivileged communities over in America.

Naturally, this leads us to wonder what the future looks like for us. For a long time it's been apparent that there is a growing gap in the owners capital and workers in the classic Marxist sense. Thomas Piketty's argument essentially is that the post war period was the historic anomaly, and that capitalism always trends towards massive inequality opening up. Based the first 15years of this decade, it seems clear we're seeing that not only will there be inequality, there won't be the work to go around. Which is essentially how the serfs came to be in Russia. If you subdivided work into tiny components to the point that each component alone cannot support an individual, you end up with what the serfs in Tsarist Russia had.

Which is alarming. Because the future of work, after more and more machines take over, is for us to do ever more menial things for less money. Big business might bang on about productivity, but the real picture is that big business is trying to turf people out of jobs. Once out of jobs, people go on welfare; but the same big businesses that turfed people out will also lobby governments to cut spending, which is going to disenfranchise these people more. If this doesn't look like a class war, I don't know what does.

In that context, I present to you this next bit:

Work For Nothing Means Slavery, No?

Tony Abbott's government wants to let businesses audition unemployed people. If they like them, they can hire them; if not, they can let them go.

The prime minister, Tony Abbott, has come under fire for suggesting employers “try before they buy” when hiring long-term unemployed people. 

Abbott made the comments during an address to the Queensland Chamber of Commerce on Wednesday morning, where he was highlighting a new initiative which allowed people who have been unemployed for more than six months to work for a private enterprise for a month before losing the dole benefits. 

“That person can do up to four weeks of work experience with your business, with a private sector business, without losing unemployment benefits so it gives you a chance to have a kind of try-before-you-buy look at unemployed people,” Abbott said. 

“What we have permitted for the first time in this budget is, if you like, real work for the dole. Work in a business for the dole,” he said.

As far as I can see, it costs the businesses nothing to hire and fire these people. One of the dodgiest and most suspect ideations to do with these work-for-the-dole schemes is that the government is paying a person something so the person should go do work in exchange for that money.

The last time I looked, the labour one undertakes in exchange for money is called 'work' and in fact if the government is calling it work-for-the-dole, then it should pay the person the proper market rate for the work being done. Equally, if a business is in need of such a person to come in and do "real work"(their words not mine), then they should bloody well pay them properly for the work performed instead of leeching off the government for free labour. Pay the person for the work they did. That's how capitalism is supposed to - pardon the pun - work.

Additionally, if a work-for-the-dole person goes and does this work for gratis, it's undercutting a person who genuinely is able to do the work, because that latter person cannot undercut the former who is working for no cost to the company. It might be fun to imagine the biggest dole-bludging teen and forcing them to clean toilets, but really, that company should be paying a professional, their professional rates. Especially when you consider things like WorkCover and workplace health and safety laws which are now Federal, not to mention liability and indemnity insurances. Who is covering this imaginary teenager cleaning toilets? The government? The company using them?

I get it that there's always mileage in picking on the next Paxton kids and demonising the unemployed but this is really pernicious. In a broader picture, what's really worrying is that the leadership of this country has no fucking idea, not a scintilla of a clue as to the problems of a future economy where there might not be enough work; and all they've got to show us is this kind of political stunt. I would think the truth is that the Coalition is very happy to cry 'class warfare' while actually engaging in it with gusto.

So What's Growing?

Would you believe restaurants, and events are growing very fast? I can tell you form an insider's point of view that food and wine fairs have grown more elaborate with larger budgets in the last decade, while governments have started spending serious money in events to boost tourism.

If you want to understand this, it's easier to translate "restaurants and events" into "bread-&-circuses". Especially considering how much government spending on this area has grown, there is a good reason to look at this growth s some kind of attempt to reflate the arts sector, without the highbrow discussions that would plague things like the Australia Council or Screen Australia or whatever the state-based organ for the arts now calls itself.

It's nice to have landed on my feet for once and watched the sector grow in the last decade or so. I also get front row seats to the fact that the government is running out of ideas as to how to make itself useful so it's decided show bit of leg and spend bigger money on events. But you know the best circuses in Ancient Rome were when Rome was closest to its demise. It really doesn't bode well for our government that they have to go with bread-&-circuses.

Maybe The Work Ethic Thing Is Not Universal

The Weird Things You Think Up When You've Got The Flu

I had the flu (again) and was laid out for a couple of weeks. I'm really only recovering my lungs this week and I've had a lot of stuff to think about at work so I haven't been writing much here. Apologies for the break in transmission.

Anyway, in-between the moments of headaches and coughs and general ordinariness, I had this insight that maybe our society putting too much emphasis on the work thing. It sounds crazy, I know, but here's the thing. We've come to the point where our government has so demonised the 'dole bludger'. that they don't want to hand out unemployment benefits to somebody under 30 for 6months while they are unemployed. The work-for-the-dole programs are presented as this great idea where these young long term unemployed people are made to work for their unemployment benefit money.

But when you think about that, you have to ask if that job they're doing is absolutely necessary. If it is necessary, then why isn't the government paying proper money to get that done by proper professionals? It's paradoxical because if the government had that kind of money it wouldn't have to cut the dole. So what you have is the government insisting that some random, context-free 'work' be accomplished when in reality it might not be relevant to the economy except it makes some people feel better that lazy people are being made to work.

What if the point of life isn't work and getting money? Maybe we're looking at unemployment benefits all wrong. Maybe what the dole really is, is a kind of dividend we pay out to members of our society based on the increasing efficiency of our society? Consider for a moment that the rewards for work are not distributed in any kind fair way.

Take Gail Kelly, the retiring CEO of Westpac who reportedly got paid 12.8million dollars this financial year. No wonder she's quitting. That's like winning lotto. With all due respect to her fine acumen as CEO and qualifications, there's no way her efforts were really worth that much. And her effectiveness probably had a lot to do with turfing people out of jobs to make Westpac a more efficient organisation. Which is to say part of her $12.8million remuneration involved putting people on the dole and taking their share of the capitalist money pie.

This sort of distorted sharing of the profits of business is happening all over the place. If there's such a disconnect between work and the rewards, I don't see why we have to pretend that it's all about the effort. Let's face it, somebody can only work so many hours the work-for-the-dole program, as hard as they can, for as long as they can, but nobody is ever going pay that person $12.8million a year. That $12.8million is simply not related to effort or dedication or skill. How can we then pretend that it represents fair value for Gail Kelly's work?

It's more rational to say, at some point there is no connection between work and its rewards. It's just circumstance and chance. So why do we insist that the connection applies to unemployed people all the time? It seems more delusional to think that the merits of the work ethic applies to everything all the time, given the extreme ends of employment and unemployment.

And it's not like the unemployed come from nowhere.

Economic Rationalism Always Kills The Golden Goose

Try this for an example. Imagine a person working for company A, manufacturing product B. Company A decides to move production to China. This is good for the company because the production of B gets cheaper. usually, it's like the fraction a cost, so let's say there's a 75% saving right there.

So let's say they're generous and Company A might pay out a redundancy to the worker which effectively buys them out for length of time until they allegedly find another job. But the person might not find another job because all the companies are moving their manufacturing to China to get that 75% saving. Pretty soon you have all these workers who lost their jobs who can't get another equivalent job, because those jobs disappeared too. Pretty soon, they're the long term unemployed.

Meanwhile, company A has pocketed the 75% saving in manufacturing costs and posted it up as profit. Shareholders lap this up because it represents 'efficiency' and 'productivity'. So in one fell swoop, they've made an unemployed person in their own country and then given that job to somebody halfway around the globe, and pocketed the change. This has more in common with killing  the golden goose; but this kind of thing has been the mainstay of managerial theory for something like three decades. And they keep coming up with reasons why this is somehow going to lead to a better economy while in fact the middle class has collapsed in America and is sinking in Australia. it's clearly self-serving corporate nonsense.

What most governments say when this happens is that these people have got to be re-trained. In reality the retraining programs often fly in the face of what actually happening in the market place for jobs. If a person loses a join the manufacturing sector, then it's cheap and easy to retrain them for something else in the manufacturing sector. If the entire manufacturing sector is shrinking overall, then it's just musical chairs where somebody misses out on the chair each round. At some point the government has to re-train these workers out of their sector which is going to cost more time and money.

The point of all this is to say, corporations regularly export the jobs and collect the difference as profit. They even devise ways to pay taxes by going international and feeding earnings through some weird tax scheme in tax havens like Luxembourg. It seems incredibly inequitable to lump the government with the costs of the unemployment imported from the third world, then complain that the government is spending too much money on welfare. If the business lobby don't like this so much, they should just bring those jobs back and employ people. It always amazes me that the ALP don't just tell the business people this, but instead go on about working with businesses and hand over subsidies which are bribes to stop them killing these golden geese.

More On That New Work-For-The-Dole Plan

"Dealing With Centrelink IS A Full-Time Job"

So sayeth a graffiti down in Victoria somewhere where everybody driving can see. It's most likely true. The dole being what it is - money for not working- the government sort of has to have scary gate-keepers to make the experience miserable enough so more people don't want to be come dole recipients. The Centrelink experience is the big stick, to the tiny carrot of disincentive to work that is the unemployment benefit payment. Gone are the days of the "non-specific arts grant".

What's even scarier is that under the ALP government, the ranks of people who had some kind of Centrelink payments swelled to 6million, which is roughly a quarter of the population. You can see why the Coalition government wants to do something about Centrelink payments to people except it also means kicking a lot of dust into a lot of faces. It's not going to win them votes. It's all very nutty and you wonder exactly how the numbers are stacked. Fortunately Guy Rundle over at Crikey has done some maths (thanks to Pleiades for the heads up):

Australia currently has around 830,000 people currently receiving unemployment benefit, which would suggest a raw figure of 33.2 million job applications being made per month under the new scheme.
However, a yet-to-be specified number of people will be exempt from this requirement because they are undergoing training and there will be a certain amount of non-fulfilment -- so let’s bang this down to a mere 25 million applications. Let’s now assume that people send these far and wide -- full letter and CV applications as required by the new conditions -- to all employers.

There are around 2 million registered businesses in Australia, but many of these are sole proprietors billing as companies or multiple shell companies around a single real business. Let’s assume 1 million employment entities. By this absurdly abstract raw count, every business would receive 25 extra applications per month.
If we assume that every application will be taken seriously -- and that is surely part of the social contract the government is proposing -- then every application will take, say, 20 minutes to process, or 8.3 hours a month, a full working day. Assuming these are being handled by an HR staffer on $50,000, that would be $200/month, or $50/week in extra business costs.

But of course, these things won’t fall equally. Many of these applications from minimally qualified applicants with little work experience will go to the entry-level service sector, dominated by small (under 19 employees) and micro (under four employees) businesses.

Let’s look at Tasmania, with the highest unemployment rate. The state has 18,500 unemployed looking for full-time work, who would generate 740,000 applications per month. It has around 25,000 businesses in the service sector -- but assuming sole traders and shells, we can bust that down to 15,000 companies. Since small businesses employ 45% of the overall workforce, let’s say they’ll receive 300,000 of these applications (in reality, it will likely be more).
Thus by this reckoning, every operating small business in Tasmania -- whether it has advertised or not -- will receive an average of 20 job applications per month, generating, by the implied social contract, 400 minutes, or 6.67 hours of extra work per month. That is less than the nationwide business average, but we’re talking about companies with one or two employees. Even if they don’t spend a great deal of time on these applications -- and many, being decent people, will give them a read -- the actual task of processing them will chew up time in a business day.

But the position gets terrifying when you limit this process to companies that are actually advertising vacancies. Seek.com.au currently has 78 vacancies in various service and unskilled sectors for the whole of Tasmania. Let’s multiply that by three for other sources -- local papers, word of mouth, milk bar windows -- and assume that those 234 vacancies receive two-thirds, 67%, of the applications. That is half a million applications per month for 234 jobs, or 2136 applications per job.

That's pretty scary. Being somebody who has to read job applications, I am just dreading seeing a load of job applications where I can't tell if they are keen or not at all. Just as night follows day, if the Coalition get their way on this idiotic idea, I will be reading a lot more resumes than I need to or want to - and that's just my own selfish take.

The somewhat bigger picture is this: If you are in a small industry, there won't be more than 40 companies in your sector of work. Once you're applied to all of them, you're done. It's one thing to imagine an infinitely interchangeable unemployed person going into a workforce with unlimited flexibility in how it handles skilled positions in the workplace but the reality is nothing like this.  Certainly if it was a small sector with only 40 or so companies, you would be sending in a resume every month to the same companies knowing full well they won't even read them because they know you're only doing it to get unemployment benefits.

As policies go it's pretty crappy because it cynically assumes that people won't get jobs, but they have to keep trying. And if everybody did do as assumed by the government says, the numbers say it can't work. The scheme also floods the HR departments of various companies with garbage data they didn't ask for, but must be processed anyway - which is costly as well as time-consuming and aggravating. And it also ignores how jobs are distributed across the country. I'm actually scared of how this one is going to turn out.

We Need To Reconsider Education, Work, And Pay

This isn't a popular notion but it bears mentioning anyway. Our society runs a kind of Darwinian race for our kids as they grow up. The rules don't stay the same and fads come and go, but in general, the 12 years of junior school and high school is to pick out the best students and send them to university. It also selects the group who are not as good academically, but kids with aptitude towards various trades. It really isn't interested in kids who are neither academically brilliant or have little sensate skill they can parlay into a trade. Unsurprisingly the dregs of this process end up as adults without a future of any kind. And it's this population that ends up on the long-term unemployed list, or ends up in a life of crime.

You know those kids. You know those people. You know they exist.

The point is, schooling spends a good deal of time picking winners and losers, and some of the losers lose big, and lose early.  Some of them get a second chance and find some kind of career, but more often than not, the pure abject losers end up as the long term unemployed. It's a brave employer that gives those people a chance by hiring them. Living at home with one's parents into one's forties is not a dignified way to be; living like a homeless person or actually becoming a homeless person is even worse. Doing it on welfare payments likely isn't exactly the lap of luxury.

Having created winners, the winners go into medicine and law, and some even become politicians and make laws; and this is where it gets really unfair. The people who never lost in their lives get to tell the losers who lost early and lost big that somehow their own fault for not having the right dedication when likely it has a great deal to do with circumstance and environment. Arguably, the winners get to corner the market for high-paying work and the benefits that accrue from such work over the less successful, and then press home the advantage at every turn.

Thus inequality in our society necessarily starts with our concept of education, work and payment. Inequality can only be addressed by governments that are willing to admit that part of its job is wealth re-distribution from the overly successful to those in need - that is to say, the successful lawyer or doctor or banker can afford to pay a little extra to help the people they left behind. To turn around and scorn the losers and cut the benefits seems like an incredibly ungracious thing to do. It's really not that difficult to understand. Hence a Coalition government that seeks to cut the welfare payments and cut taxes is a government that seeks to increase inequality in our society. There's really no two ways about it, and it's pretty deplorable.