The End of Work

In 1995 economist, Jeremy Rifkin, wrote his book, “The End of Work” in which he predicted the global decline of the work force in the industrialized would. This happy occurrence, he predicted, would then result in people having more “leisure” time. New industries revolving around this new leisure market would then flourish. When I heard the initial buzz about this book the first thought that occurred to me was: Wouldn’t people working less hours therefore have less disposable income? Who is going to be able to afford all these “leisure” activities?

Fast-forward to the Recession of 2008. To a great extent Rifkin’s prospective has indeed come true. Rifkin had accurately had predicted the eventual demise of the middle class. Increased productivity, including “automation” (the old term) has indeed lessened the demand for labor. Even the “new” economies that are touted as the future economy do not necessarily require a lot of human labor.

The newer profitable companies with huge market capitalization, such as Google and Microsoft, don’t really employ a lot of bodies. The same is true for financial institutions; they too don’t require a lot of people to generate wealth. The hottest consumer items on the market today, mostly technological products like phones, touch-pad devices – None of them are manufactured in the USA. Even the Chinese are aggressively outpacing our “innovations” in solar and battery technology.

I think back to my first job out of college, working in a clerical unit in Greyhound Bus Lines. The manual sorting tasks required in my job back employed several dozen people to manually sort out paper ticketing trails. This kind of tedious work has been now wholly replaced by simple bar codes, scanners and computers. One can easily imagine how this simple technology across the board of bureaucratic functions alone has easily replaced millions of jobs that were once completed by humans.

Later after I landed a “real” job working in banking, I embarked on what I assumed would be a career. The assumption was that you worked your way up through the bank eventually becoming a loan officer. I am not sure how many of you have applied for a loan at your local bank recently, but if you have, you may have noticed a lot “empty space” where all those bank employee desks used to be. Today your application is faxed, or e-mailed up to a centralized loan approval center where a few designated “loan officers” actually make those decisions. Seriously, why would the bank want to staff all those highly compensated suit-and-tie bodies in the local branch bank when instead they need only lower-paid staffers to assemble and pass along your loan paperwork to the few main office employees empowered to make those decisions?

It is true that technology itself spun has off new career paths – and I followed one of them. When I later worked for the state Department of Human Services as a Welfare Caseworker, much of the paperwork was eventually shifted over to software running on networked personal computers. This productivity change opened up a new career path for me as a Computer Network Technician… and at a nicely increased salary. But even technology is subject to productivity enhancements. Eventually the work I did in the local offices was “centralized” elsewhere; less and less of the work I did as a technician in the field was deemed necessary. By the time I retired I felt like my job was little more than as a “PC mechanic”.

The national and global economies are still reeling from the aftermath the Debt Ceiling Circus. Economists are talking confidently of Double-Dip Recession and postulating on how long it will take for the economy to pick up again. Of course the two major political parties are even now strategizing on how the prolonged recession will play out to their respective advantages in the upcoming election of 2012.

My longer term prediction is much darker: It won’t matter which party prevails. The economy will never get better more than marginally or temporarily. To me, the fate of our standard of living on this planet boils down to a simple math problem:

1. World population will soon hit 7,000,000,000.
2. Increases in productivity in every sector (agriculture, technology, finance, etc. will continue to require fewer people to perform them. The living standard of middle class will continue to shrink and economies based on consumer spending will founder.
3. Income disparity between the very rich and the middle and lower classes will increase.
   
4. The last of the “easily obtainable” natural resources have (or will have) peaked during our lifetime.
5. Food will become more expensive as bio-fuels consume more of the food producing land and resources needed to produce it.
6. Global climate change will continue to have a negative impact on all of the above regardless of whether people “believe” its happening or agree on what the root cause is.

I have stated countless times that I believe that my generation, the Baby Boomers, has lived during the best times man ever has, and ever will have, on this planet. I feel sad for my kids and my grand kids; they're going to have a Brave New World to contend with.

Where Have All the Good Jobs Gone?

So the stock market is booming, corporate profits are zooming but jobs are still looming and the outlook for the middle class is glooming. The reasons behind the stagnant unemployment outlook has not gone without thorough analysis by we bloggers who, for some reason, seem to have a lot of free time on our hands:

Don’t bother us, we’re busy...

The current theory is that the rich people should not be inconvenienced by the demands of comity because they're the ones who are providing jobs for the rest of us. Those jobs should be kicking in any time now, because we lowered the taxes on the rich people several years ago. There should be so many jobs by now that they're just loitering in gangs, making nuisances of them selves.

Murr Brewster - Murrconomics

... hedging our bets ...

Where are the jobs? Honestly, boards and business owners are holding back because they feel that the current administration chooses winners and losers in the marketplace. Without fully understanding their future costs, or if they will draw the ire of Obama, they find it safer to sit on their cash.

Comments from the Heathen Republican who provided the link: Why Business Isn't Getting In the Game.

... and besides, there's no jobs because there's no customers...

Big American companies are sitting on almost $2 trillion of cash because there aren't enough customers to buy additional goods and services. The only people with money are the richest 10 percent whose stock portfolios have been roaring back to life, but their spending isn't enough to spur much additional hiring.

Robert Reich: The Obama Budget: And Why the Coming Debate Over Spending Cuts Has Nothing to Do With Reviving the Economy

…and, come to think of it, we don’t need any workers anymore either.

…our most admired corporations -- GE, Apple, Hewlett Packard, Intel -- are creating ever more jobs overseas and relatively fewer at home. This has the double benefit of taking advantage of cheap labor abroad and disciplining workers to accept low wages at home. Along with the high unemployment rates have come declining earnings… In 2001, 32 percent of the income of the firms on Standard & Poor's index of the 500 largest publicly traded U.S. companies came from abroad. By 2008, that figure had grown to 48 percent.

Robert Kuttner - Business Doesn't Need American Workers

So even though corporate profits are soaring, that does not translate into jobs for Americans because corporations don’t need Americans any more to either buy their products or even make them any longer and anyway middle and lower class Americans are really nothing more than poker chips for the wealthy to play with.

My own diverging theory is that the Republicans will do anything to prevent the jobs numbers from going up anytime during the Obama administration least he end up getting credit in the public eye for improving the economy prior to the 2012 elections.

Ok, so sometimes I am a cynic when I should be a skeptic. I’m calling your bluff.

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I highly recommend following these blogs:

Murmers – a very well-written humorous blog with topics ranging from the latest poop on the economy to the latest poop on, well, poop.

The Heathen Republican – in a more serious vein; a thoughtful, rational and well-documented perspective of the Republican policy stance.

Robert Reich's Blog - A totally brilliant man, Berkeley professor and Clinton's former Secretary of Labor.

Or if you still perfer the low-brow approach, you certainly can continue to read this blog.