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Tag Archives: gig economy

A joke doing the rounds way back in the 1970s went like this*: The CEO of a car manufacturing plant was showing off his new assembly robots to a trade union official, “You’ll never organise them!”, he boasted. “And, you’ll never sell them a car!”, replied the trade unionist. Funny and true. So, we’ve been aware of the direction of production, work and capitalism for a long time. However, until very recently it was difficult to get people to pay attention. Even now it is probable that a majority would prefer to argue and make policy as if it were still the hey day of industrial capitalism and industrial workers. It may be that the significance of I.T. is lost on them but it could be that they are unwilling to change familiar, comfortable ways of thinking.

A long-standing trio is crumbling because the productivity of today’s technology i) undermines the working of industrial capitalism, ii) undermines state welfare systems designed to ameliorate the effects of unemployment and iii) requires socialists to rethink their basics.

The best way into the heart of the question is via Marx. (Yannis Varoufakis has been on about it recently.) It goes like this: it is labour that creates ‘value’. Work is the core; it transforms raw material into useful products.

In steps capitalism. Profit emerges in selling products but obviously selling relies on buyers. Bluntly, the supply of products makes no sense without demand. Demand depends on money moving about – circulating – but that in turn depends on people having incomes. Traditionally this has meant jobs paying wages and salaries.

It’s hardly surprising then that the history of industrialisation is punctuated by workers resisting new productive technology. The purpose of new industrial technology is to reduce the amount of labour necessary to produce the goods. In short, its purpose is to do away with jobs.

Of course there was a time when it wasn’t as simple as that because growth and new technology created other jobs, lots of them, with titles that would have meant nothing a few years earlier. Moreover, the new jobs tended to be dry, clean, quite well paid and prestigous. By the 1960s and 70s “ordinary workers” were not defying death by going to work but were relatively comfortable, educated, healthy, ambitious and many were buying houses. Certainly there were still dreadful jobs and piecework remained a curse but there was hope.

The hope rested on the unfounded belief that things could only get better, that because a generation was better off than the preceding one, it was now to be expected for succeeding generations, that education and a job meant comfort and a fulfilling life, and that the state would provide in the event of a life-changing catastrophe or a period of unemployment. Okay there were still fatcats, privilege and exploitation but overall the majority found the “trickle down” argument plausible.**

Things are different now. Forty years of neo-liberal economics coupled with IT development have produced a society in which ordinary workers cannot buy houses, cannot assume that they’ll be better off than their parents, cannot assume that a good background and education will lead to a satisfying career. There are baristas and carers with PhDs. There are people living hand to mouth on piecework which we choose to call the gig economy. There are people employed but living in poverty, dependent on welfare just to keep going. This isn’t part of an economic cycle. Those good jobs which made the mass of people prosperous are no longer required; they’re gone.

The naive response would be to cite capitalism for screwing down incomes. Sure, there are rich chancers making money by exploiting vulnerable people but there is more to this and a naive left response is much worse than useless.

The reality is that productive technology has reduced the cost of doing the bulk of those good jobs to zero; no labour is required to do the jobs that so many people thought were their future. Some of course do exist but work has been moving upmarket and downmarket, evacuating the middle. The need now is for high level expertise and for unskilled and semi-skilled workers. The process is in its infancy but these days the likes of doctors, accountants and drivers of all sorts find they are reading more and more about artificial intelligence – the latest manifestation of productive technology – and they are worried.

Here’s the thing: At some stage in this process capitalism becomes pointless. As technology – artificial intelligence – reduces to zero the labour required for most production, the owners of the means of production increasingly come face to face with the new reality. It dawns on them that they cannot realise value as profit. This is the end stage foretold in the 1970s joke and unless capitalism – or rather industrial capitalism – can find a way to accommodate the new order, it faces an existential threat.

Some years ago it was argued that the industrial jobs still existed but globalisation had allowed them to be moved to low wage economies. That did happen and it remains the case that where wages are sufficiently depressed, labour is cheaper than machines but machines today are utterly effective and efficient, and there’s a greater proportion of software as opposed to hardware production.

The welfare state whose mission for decades was to support capitalism by dealing with unemployment – paying workers temporarily unemployed, providing training, retraining and education to serve industry, providing all sorts of aid to investment – has to confront a fundamentally different problem: a shortage not of educated, skilled workers but a shortage of work befitting them. States and governments, having created an educated workforce and having made job creation a measure of success, are resisting change. Indeed for the most part they are doing as they’ve done for decades because the change required is as yet inconceivable.

While the modern liberal state finds it hard to adapt, many socialists – so theoretically and emotionally bound up with labour, the working class and jobs – may find it next to impossible. However, adapt they must because otherwise there will be no plausible counter to today’s and tomorrow’s forms of exploitation and structure of inequality.

In Ireland unemployment is at about 6% and the trend is downward. Allowing for those who don’t want a job, those who are between jobs etc., it will be said at about 3% that full employment has been reached. Even among socialists it is often still believed that a job is the best route out of poverty. Now, it may be the best available route but clearly it is not anything like a guaranteed route. This is because – yes, again – those mid 20th century rewarding jobs are gone and the 6 – 3% unemployment figure is achieved largely through the expansion in poorly paid, insecure, unattractive jobs.

Socialists and Trade Unionists will try to secure better pay, conditions and security for these workers but they cannot change the nature of the work itself. The work is what is left after the present generation of automation.

Already it is frequently argued that there is no point in educating masses of people for non existent jobs, that higher education should be concentrated on a smaller elite and that money saved would be better spent on training. Now, this is precisely what should be done if the purpose of the state and particularly education is to create workers for the jobs available. However, when meaningful work for the masses cannot be created, then leftists must demand that the purpose of the state change. Such a demand depends on an enormous change in the thinking of socialists because no matter who owns and controls the means of production, one thing is clear: machines, automation, I.T., artificial intelligence cannot be uninvented.

To be at all plausible socialist argument and policy must address not 19th or 20th century capitalism but today’s iteration.