Will we ever have full employment again? I think it is pretty unlikely for a number of reasons. The most controversial reason harks back to an observation by Karl Marx that the capitalist society requires a reserve army of unemployed to provide cheap labour.
Will we ever have full employment again? I think it is pretty unlikely for a number of reasons.
The most controversial reason harks back to an observation by Karl Marx that the capitalist society requires a reserve army of unemployed to provide cheap labour. There is certainly some evidence that there is no real intention to have full employment again. There is even an economic metric called the NAIRU or Natural Accelerated Inflation Rate of Unemployment. The OECD has set the rate for the UK at 6.9% and possibly by complete coincidence the bank of England recently said that if unemployment drops below 7% they may need to increase interest rates.
The theory behind the NAIRU is that if unemployment drops below the NAIRU then it will cause inflation . Nobody wants inflation least of all the people with all the money. No government is ever going to admit to having a lower target for unemployment, but that said, Norman Lamont let the mask slip in 1991 when he said.
Rising unemployment and the recession have been the price that we have had to pay to get inflation down. That price is well worth paying.
Norman Lamont-Hansard, HC 6Ser vol 191 col 413 (16 May 1991)
Less controversial is the idea that automation is taking our jobs. The acceleration of IT and associated technologies like electronics and robotics continue to be highly disruptive. The first jobs to go will be the low skilled and we are already seeing burger flipping robots, self service kiosks, online ordering and soon to join that list will be driving. Amazon is even considering using drones to deliver parcels. Have a look at Federico Pistono’s Ted x talk for some figures.
All this automation will cost jobs,but I don’t think its all doom and gloom just yet. Because quite often automation creates new opportunities and new jobs. But the disruption to jobs and the necessary reskilling of the workforce will leave structural gaps that will take time to fill. If the workforce don’t have the right skills, jobs will go unfilled.
Another reason why we will not see unemployment drop in the near future, is that there is a big world out there full of people who are getting educated and taking a bigger slice of the pie in the service industry. Why pay British software engineers and project managers when you can outsource to Mumbai? I’ve seen it at first hand. We were even bringing programmers over from India on special visas while BT was making people redundant. I have news for bankers and captains of industry, even your jobs are not safe.
Wage stagnation and increases in the cost of living will also cost jobs. If we start seeing people take multiple jobs or working longer hours to make ends meet, it will be at the expense of someone else having a job. But lets not also forget that if all the wealth is concentrated in the unproductive parts of the economy we are going to see less and less money spent on the high street and with small business that too will cost jobs.
So given all these reasons why full employment will not happen, why the hell are we treating the unemployed as if they are all lazy and good for nothing. Why do we have to find excuses not to pay them the money they are entitled to and to badger them endlessly to find work that simply isn’t there?
Yes there are people who will be happy living on handouts but if we haven’t enough work for everyone then why drag them unwilling to jobs. Let the people who want to work do the work.
An unconditional basic income will provide a floor on which people can stand.If they have their basic needs met, then they will have that little bit of extra security, that little bit of extra freedom that will let them look for that better paid job or start a new business or train for a job that would otherwise go unfilled.
With a basic income they don’t have to worry that taking a temp job will lead to weeks without money while they have their benefit claim re-processed. A Basic Income will free people to work.
Maybe it will also allow those of us who are already well-off to work less hours and give someone else a chance to earn some money.
Sign the initiative and more importantly tell everyone you know to sign it we are running out of time to get the votes in.