Thursday, December 1, 2011

The End of Work

I'd like to write about The End of Work by Jeremy Rifkin, which I read last week. It is an older book by the standards of the current debate on labor markets and change. It came out in 1995, and argued that automation was wiping out employment across many industries in a wholly unprecedented way. 

The book finds its way into just about recent bibliography on the issue of how the labor market has changed. It attracted a huge flurry of attention in the post-recessionary, business re-engineering world of the mid-1990s with its massive layoffs in corporate America and feeble economy. 

Then, in the huge boom of the late 1990s, the book seemed to fall from attention. The world moved on, and quickly.  One of the fascinating things about the book is it has only one entry in the index for "internet" - and that is a specific dial-up data provider for abstracts of books and journals. 

To be sure, it talks about the "information superhighway" here and there in a peripheral way. But it is usually very difficult to see what is just around the corner. 

And that was of course the wild internet boom of the late 1990s, which turned capitalism on its head for a few years. and were just a few years away. Google and were just ideas when Rifkin finished the book. Soon, everyone thought they were getting rich, until the NASDAQ crashed. 

I think this highlights one fundamental issue with the whole nature of change. We can see some things coming from a long way off, but it sometimes takes a very long time for them to get enough computing power or momentum or support to take off. Artificial intelligence has been a major field since the 1970s, for example. But Apple's new Siri on iPhones is one of the first major consumer applications which begins to approximate some of the hopes of the 1970s. And even that is a long way from Hal in the movie 2001.

Things happen much slower than you think. And things also happen much faster than you think - when you look back cumulatively.  You can get the right trend - but much too soon. 

And that is what I think happened to Rifkin's book. His basic argument is (from the introduction):

For the whole of the modern era, people's worth has been measured by the market value of their labor. Now that the commodity value of human labor is becoming increasingly tangential and irrelevant in an ever more automated world, new ways of defining human worth and social relationships will need to be explored. 

The history of an idea

One of the most interesting things about the book is several chapters talking about the previous history of the idea. In the 1920s, as productivity soared, there were fears that demand would be insufficient. Businesses urged consumers not to go on a "buyer's strike." The press talked about "limited markets."

But business evolved away from a focus on production to consumption and consumer behavior. Advertising and consumer credit helped to stimulate new demand. The tale of "trickle-down technology", as Rifkin called it, seemed to work. Falling prices meant consumers had more money to spend on new goods. 

 After the second world war the same fears resurfaced. In 1947 Forbes mahazine ran an article called "Machines without Men" which announced that "the threat and promise of laborless machines is closer than ever." (p66). 

But the service sector boomed and military spending also boosted demand for four decades. The public sector expanded and employed millions. 

And so by the late 1980s people still believed that, as one official report put it, "historically, and we believe for the foreseeable future, reductions in labor requirements per unit of output resulting from new process technologies have been and will continue to be outweighed by the beneficial employment effects of the expansion in total output that generally occurs." (p40) 

Indeed, there was a long tradition of what Rifkin calls "visions of techno-paradise", with celebrations of engineering and technology, at least until in the wake of the shuttle disasters and Three Mile Island technology looked fallible as well. But. he says,

Ironically, the closer we come to the technologival fruition of the utopian dream, the more dystopian the future itself appears. That's because the forces of the marketplace continue to generate production and profit, with little thought of generating additional leisure for the millions of working people whose labor is being displaced. 

Not everyone benefitted from automation, of course. In one particularly interesting chapter Rifkin traces the impact of just one new technology - the automated cotton picker - on African Americans. "In 1949, only 65 of the cotton in the south was harvested mechanically; by 1964, it was 78%." (p71). A few years later it was 100%.  Five million people were pushed off the land and migrated north, just as a new wave of mechanization to displace unskilled labor in factories hit. When Detroit increasingly automated, blacks were disproportionately affected. 

I'll discuss what the book says about the situation in the 1990s in the next post. 

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