Redefining Work

A busy day calls for a repeat. This piece from two years ago demands a revisit in light of the potential for inflation now that we are approaching full employment and wages are indeed rising.

Is technology a net creator or destroyer of jobs? The question is as old as the Industrial Revolution, when workers in mills found themselves put out of work by large industrial looms. In France, they threw their shoes (sabots) into the weaving machines to destroy them – the origin of the term “sabotage”. The protests didn’t stop the machines, however, and the workers had to find something else to do in an ever-changing economy where machines did more and more work.

Today, the pace of technological change is faster than ever, with new gadgets coming into our lives constantly. Automation is also transforming our lives, with new robots and artificial intelligence replacing workers constantly. Are today’s productivity gains tomorrow’s unemployment? Increasingly those who study technology in our lives and the popular media are coming to the conclusion that yes, workers are net losers in the race against tech. And this is not a partisan issue.

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Unions are Our Future

Labor Day is brought to you by those who brought you the weekend – Organized Labor.

When I worked in Germany for a short time in the 1990s, labor relations often came up. Some of my colleagues were envious of the US system while most hated it. All of them, however, had a term for what they understood our core principle to be – “Hire and Fire”. The idea of an “at will” employee with no job security in law and no loyalty by tradition was alien to Germans.

Compared to the nations in the developed world which we compete with, our position is unusual. It’s a bias at the foundation of our system – a natural outcome of the demand for a flexible workforce. This is also likely to change as more and more skill is needed to do the jobs of tomorrow.

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Good Season(al Adjustment)

By the time you read this, the big news is likely to be jobs. It hasn’t been a hot topic since the election, and most of what was said during that strange period wasn’t exactly true. The big job gains for February, along with a large round-up for January, make it impossible to ignore.

The economy has definitely turned around.

It’s all over but the shouting, of which there will be a lot. There is little doubt that Republicans will claim credit for a big turnaround in 2017, which will be utter crap. This has been a long time in the making and things have not been actually bad for a long time. Nevermind. Positive news will feed on itself and everyone will be happier.

But there is one final twist to the very good news – it’s really in the adjustment.

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May You Live in Interesting Times

Years ago, Barataria predicted that 2017 would be “The Year Everything Changes”. The lesson is, of course, that we all need to be careful what we wish for.

The basic underlying forces which drove that prediction have not changed. The holiday shopping season has yet to be fully tabulated, but it appears that the robust 3.6% gain predicted was met or even matched, with one estimate showing a 4.9% gain. Baby Boomers will still hit retirement age and there will definitely be a shortage of workers coming up, especially in certain skilled areas.

For all that hope, the upside will be limited by an incoming Trump administration. It’s not just that they are largely tied to political views which do not fit the situation, it’s that many of them have little to no experience making policy. To a large extent, nothing will get done. But what does get done will happen among the bureaucracy. That may mean more change than we all think.

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Labor Unions are Inevitable

Labor Day is brought to you by those who brought you the weekend – Organized Labor.

When I worked in Germany for a short time in the 1990s, labor relations often came up. Some of my colleagues were envious of the US system while most hated it. All of them, however, had a term for what they understood our core principle to be – “Hire and Fire”. The idea of an “at will” employee with no job security in law and no loyalty by tradition was alien to Germans.

Compared to the nations in the developed world which we compete with, our position is unusual. It’s a bias at the foundation of our system – a natural outcome of the demand for a flexible workforce. This is also likely to change as more and more skill is needed to do the jobs of tomorrow.

Continue reading

Productivity Down – Blame the Kids?

The decline in productivity, first noted 15 months ago, is starting to become a serious issue. It is true that an increase in GDP is most likely and most sustainable when the output for every worker constantly goes up. But over the last year, we’ve had a sustained drop of 0.4% annualized.

The message is starting to creep into popular media. A scapegoat now has to be found, lest our politics actually focus on something real and useful. The blame for this decline now falls on smartphones – especially in the hands of those slacker Millenials.

Those kids! They just won’t get off our lawn. Or put down their phones and start mowing it, something like that. We’re never sure. What we do know is that rather than discuss economic trends we now have someone to blame so we can divert our attention from reality. This is just in time for the problem to solve itself.

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Player Piano

Another bizzy summer day demands a repeat.  This one from 2014 is always timely, and hits on a theme discussed at greater length in Part 2 of People’s EconomicsWork in the Next Economy

Kurt Vonnegut’s 1952 novel “Player Piano” was more than his first. It was arguably the first “dystopian utopia” novel of a world carefully described and proscribed for everyone involved. Those with technical degrees were the masters of the carefully planned world, and the rest either joined the army or worked for the “Reconstruction and Reclamation Corps” building infrastructure. Government took care of everyone, but not all were happy. Rebellion steeped under the calm surface in both the working class and the unchallenged rulers.

It’s hard to not think of such a world when reading “AI, Robotics, and the Future of Jobs” from the Pew Research Center and Elon University. A survey of 1,896 experts in technical areas were asked what they thought the future world of employment might look like – how much automation might displace workers and how many jobs it might create. The results read something like Vonnegut imagined – enough so that a little anxiety about the next economy is justified.

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