In our culture, work is probably the most important element in our lives. Our jobs give us the wherewithal to feed and clothe ourselves and our families; however, it gives us a lot more that we value very much: purpose and meaning to our lives; a feeling of belonging; self-esteem; pride in our skills; and sometimes recognition by society or by our peers for a job well done. If you have any doubts about how significant a job is to our well-being, just ask someone who is unemployed.
Unfortunately, there is some bad news about the availability of work in the twenty first century. Work as we know it is disappearing.
In 1995 Jeremy Rifkin published a book titled The End of Work. He argued that in the industrialized world, globalization and automation together were making the human worker obsolete. There was much disagreement about this claim at the time, and there still is; however, the dismantling of manufacturing in North America in the years since the publication of the book suggests that Rifkin was right; moreover, other sectors besides manufacturing need fewer and fewer workers as automation and/or offshoring take over.
Globalization has made competitiveness among manufacturers much more ruthless than it was forty years ago. At that time competition for the consumer’s loyalty was limited to manufacturers who were operating from the same or similar circumstances— within the same country or with countries that had similar economies.
Globalization has meant world wide competition even with countries that pay slave wages with little or no environmental or labour regulations. For workers and employers it was an unattainable challenge. How could North American workers compete? Yet many employers have tried very hard to lower their labour costs by attacking unions and lowering wages, sometimes by as much as fifty percent.
Some corporations have moved their operations to these jurisdictions to take advantage of the low wages/no regulations environment. This has been a serious blow to workers in the industrialized world because it has meant job loss. However, to date the number of jobs lost to offshore production has been a small percentage of the economy. The major reason for job loss in the manufacturing sector has been automation, which has been going on for many years. No human being can compete with a robot for productivity, and so automation has become the best solution for manufacturers who want to compete with the rest of the world.
Automation can certainly be useful to help workers do their jobs better or to do heavy or dangerous work that could be harmful to workers. But as technology continues to ‘progress’ more and more jobs are being automated. All we need to do is look around our city to see the effects of automation; for instance, every ATM machine represents a bank teller who no longer has a job. The gas jockey is no more as we fill our gas tanks ourselves and so on. Every area of our lives has been affected to some degree by automation.
Although the North American economy is recovering from the recession, jobs have not come back as expected. Many employers have simply invested in automation instead of people. Recently Edward Learner of the UCLA Anderson School of Business spoke of the “jobless recovery” in this way, “If you have nothing to offer the job market that cannot be supplied better and cheaper by Robots, Far-away Foreigners, Recent Immigrants or Microprocessors, expect it to be exceedingly difficult to find the job to which you aspire, and plan on doing low-wage service work at the end of a long and painful road of diminished aspirations, no matter what your diploma may suggest.”
It has been an article of faith among most economists for many years that the invention of new technologies creates new jobs and that has been the case historically. For example, when the car replaced the horse and buggy, the blacksmith was replaced by the auto mechanic. They call it “creative destruction,” a necessary component of a capitalist economy. Creative destruction describes the way a new economic order replaces an old one. It usually causes temporary economic distress though eventually an innovating economy generates new and more interesting jobs. We are now undergoing a major shift in our economy from an industrial economy to a knowledgebased economy, but we are not creating enough new jobs. Will the laid off factory workers of today become the knowledge workers of tomorrow? Probably not.
First of all the knowledge economy requires a very different set of skills than the skills of a factory worker. More important is the fact that it requires far fewer workers than the assembly line required. The knowledge economy is not likely to provide work for all the displaced workers even if they have or acquire the skills. Automation and information technology have created a workplace which can more or less run itself.
More jobs than most of us can imagine have been automated. The office has been revolutionized by machines like the computer, the printer and the fax machine. Automated warehouses staffed by robots and remote-controlled delivery vehicles fill orders in a matter of minutes without the assistance of human physical labour.
What are the consequences of an economy that does not need workers? If we continue on the path we are on, the connection between work and income will be severed for most people. Wealth will be in the coffers of the owners of technology. The gap between the rich and the poor will increase to the point where the poor will not be able to support themselves or their families while the rich will be wealthy beyond all imagining.
The poor are not likely to accept this fate without a protest. When they can no longer afford to consume, the wealthy will have to reconsider the distribution of wealth or lose it all. Social unrest would be widespread.
There are other ways to proceed. We will explore alternatives to social chaos in the next issue of Learning Curves.
SIDEBAR: Jeremy Rifkin is president of the Foundation on Economic Trends and the bestselling author of nineteen books on the impact of scientific and technological changes on the economy, the workforce, society, and the environment. His books have been translated into more than thirty five languages and are used in hundreds of universities, corporations and government agencies around the world. His most recent books include The Third Industrial Revolution, The Empathic Civilization, The Hydrogen Economy, The European Dream, The End of Work, The Age of Access, and The Biotech Century.
Automation is the use of computers to control a particular process in order to increase reliability and efficiency, often through the replacement of employees. For a manufacturer, this could entail using robotic assembly lines to manufacture a product.
Offshoring is a business activity that involves the relocation of a company’s business process or processes to a foreign country. This can entail moving manufacturing, centers or operations to a different country. Offshoring is often used to reduce the cost of business, with the company seeking to move parts of operations to countries with more favorable economic conditions.