Sunday, September 26, 2010

More Jobs? How About Less Work?

Here's an essay I wrote in June, 1994 for a writing class that I turned up the other day looking through old papers.

Here's a notion that is political heresy but that we had better learn to handle: finding full-time jobs for all Americans who can work is impossible, and trying to make it happen is bad public policy. If we need proof that full employment is an unsustainable proposition, we need only look at Wall Street's recent responses to the news that unemployment has reduced. It's only going to get worse.

Expressing the argument in simple terms of social behavior, producing all the goods and services Americans want requires a great deal less than the full-time effort of all our able-bodied adult population. This statement is oversimplified in that it considers the United States as a closed system. However, consider the following questions: If we produce for poorer countries and sell to them, won't that just enrich us further and perpetuate their poverty? And, as for richer countries (if there are any), why should we work to put bread on their inhabitants' tables if they are not inclined to do it for themselves? These should serve to start to show that international trade can only address the domestic employment challenge in a limited, short-term fashion. Its role is instead as a balancing process in which the comparative advantages of different nations are utilized to add value through greater economic efficiency.

Greater efficiency leads among the reasons why we should expect ever greater unemployment in our future. Quality management efforts have dictated relentless improvements in manufacturing processes. Service and manufacturing companies alike have realized savings through pruning middle management. The owners of international capital have demanded the liquidation, downsizing, or relocation of unprofitable operations. These products of the "Invisible Hand" of market economics are inevitable, and they have positive effects in rising productivity and keeping American industry, yet there is no law of macroeconomics which tells us that their net result on employment will be positive or even neutral.

Reductions in the level of employment in America may also result from structural changes to eliminate unproductive work, particularly in the public sector. Government social services programs at all levels will certainly undergo the same kind of pitiless scrutiny for productivity improvements that occurs in private industry and in non-profit agencies. We will all insist on it, to reduce both the budget deficit and the amount of wasteful spending. "Star Wars" missile defense programs will lose their funding (and those in those programs will be displaced), not because they are unnecessary for security, but because we will come to realize they just don't work: the task of intercepting an incoming ballistic missile is basically an impossible one. Support for the national manned spaqce program is likely to evaporate except in the areas which depend on it to maintain jobs.

Similar considerations of localized unemployment effects have postponed the expected peace benefit from the Cold War's end, a major reduction in military expenditures for weapons development and base personnel. Public understanding already exists that such "pork-barrel" decision methods are unethical, but they are accepted as a political fact of life. Structurally, voters have no method of penalizing the representatives of other areas for their selfishness. Recognition of the intrinsic nature of this governmental waste combines with the voters' powerlessness to change it, producing increased cynicism about politics and decreased willingness to fund governmental activities. These changes, too, will in time lead to reduced public-sector jobs.

Time is a factor which will tend to increase the gap between the number of employable individuals and the number employed full-time. Actually, we are now in the beginning of a period of a predicted labor shortage, when demand exceeds supply for certain skilled professions. Indeed, the market for current graduates is the strongest that it has been for many years. This will give way in a few years, though, to a steadily rising tide of new entrants to the job market, the children of the baby boom. To make things worse, the long-term forecasts which emphasize the huge surge in retirement-age people beginning about 20 years from now rarely note that, with pensions and savings shrinking, many of these people will need to continue work well past age 65, again causing excess job-seekers.

A future for America in which unemployment is endemic among its youth, even the most educated segment, should not be so surprising an idea. The fully-developed economies of Western Europe have had such a condition for decades now. Those societies have endured the strains such conditions bring, largely through extending the term of parental support and through developing a variety of forms of casual, informal, and part-time labor.

These are the types of adjustments we will need to make in American society. The marketplace does the best job of allocating a scarce commodity, which employment is already and will become more so. However we must give employers the variety of tools they will need to employ people rationally, instead of forcing a dichotomy between those who Have and Have-Not work. In civil society, we must develop new norms of equity in the distribution of employment--for example, it may not be the case that "one can always find work if one tries". Politicians can add value through responsible statements which recognize the limits of our society's capacity to provide employment, and through restraint in advocacy of localized solutions which work to the detriment of the general public.

What we all must try to do is develop creative solutions that recognize that employment is not a binary variable. As an example, consider the current debate over national health insurance. Putting the burden of payment solely on large employers of full-time workers will tend to decrease their number and further concentrate their burden, thus producing a job-destructive cycle. A more creative approach would provide partial benefit credits for part-time and temporary workers. This would also leave the way open for an enhancement in which work credits and associated health benefits would accrue to those performing critically important unpaid work, like caring for elderly relatives or responsibly raising children.

Accepting less-than-full employment is political heresy only because of the financial insecurity it implies, not because we all want to spend all of our lives at work.

A couple of the arguments are dated, like the one about the end of the Cold War, but most of them are as relevant or moreso now--note that this was written when the debate about Hillarycare was active. As for me, at that time I was looking from the inside out (i.e., I was one of the overemployed), but though that has flipped, I still feel the same way. The tech boom gave way to the war on terror and then to artificial props through financial engineering; now that those bubbles have burst, forming the Great Crater, the government's attempts to artificially produce employment are falling short, yet the politicians' pronouncements (from either party) on the subject have not progressed one iota.

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