The End of Work: The decline of the global labour force and the dawn of the post-market era
By Jeremy Rifkin
Tarcher/Putnam, June 1996
350pp., $26.95
Reviewed by Dick Nichols
This is a fascinating and maddening book, chock-full of contradictions. Rifkin's theme is the global jobs holocaust being driven by computerisation. He describes its symptoms in great detail, and his diagnosis, while not exhaustive or rigorous, is often illuminating.
But when it comes to remedies! For his "journey into a post-market era" Rifkin urges an ambiguous "re-engineering of the work week" and boosting the "third sector" of voluntary work. This last is to be achieved through a potpourri of half measures, bribes (tax breaks for corporations funding voluntary work), and pure pie-in-the-sky (changing the rules governing pension funds to "promote the overall well-being of the recipients").
Moreover, Rifkin offers this remedy as if it were unquestionably adequate treatment for mass unemployment, and as if any well-intentioned capitalist government could readily dispense the treatment.
Job destruction
The main value of The End of Work lies in its thorough documentation of the trend of job destruction. Industry by industry, country by country, region by region, Rifkin details the impact of new technology. For example, "between 1989 and 1993, more than 1.8 million [US] workers lost their jobs in the manufacturing sector, many of them victims of automation ... only a third were able to find new jobs in the service sector, and then at a 20% drop in pay."
Or again: "In the 1980s, manufacturers were able to save $13 million an hour in wages by eliminating 1.2 million jobs. The non-durable goods industries saved nearly $4.7 million an hour in wages by cutting 500,000 jobs. An additional $3.1 million an hour was saved by lowering real hourly wages from $10.75 to $10.33 an hour in manufacturing. Overall, American wage earners were earning $22 million an hour less than a decade earlier."
The End of Work also directly poses the alternatives that face industrial civilisation: "Ironically the closer we seem to come to the technological fruition of the utopian dream, the more dystopian the future itself appears. That's because the forces of the marketplace continue to generate production and profit, with little thought of generating additional leisure for the millions of working people whose labour is being displaced."
Evidence of this "dystopia" includes: the 92% increase in the level of profits before taxes posted by US corporations in the 1980s while "the percentage of Americans working full time but earning less than a poverty level income for a family of four ... rose by 50% between 1979 and 1992".
Or again, the number of US citizens living in poverty in 1992 was greater than at any time since 1962.
Those left in work suffer more, with stress at record levels: new management systems, like kaizen, function by pushing workers to breaking point, while the increasing speed of computers is producing entirely new varieties of stress in the service industries.
Against this, whole stretches of The End of Work illustrate the developments in science and technology that would make possible Rifkin's dream of a "techno-paradise". These are nothing if not compelling examples of what Marxists call the "material preconditions for socialism". Once "socialised" (i.e., taken out of the hands of the multinational corporations) the know-how embodied in robotics, microbiology and artificial intelligence could rapidly help solve the basic problems of survival, development and culture for billions of human beings.
The End of Work is also valuable for its disclosure of some hidden history. There's a powerful chapter on the effect of technological change on black people, a reminder that consumerism was an invention of the corporations (General Motors boss Charles Kettering: "The key to economic prosperity is the organised creation of dissatisfaction"), and a timely sketch of the history of the movement for a shorter working week in the US.
Permanent unemployment
Rifkin's basic claim is that "technological unemployment", which according to orthodox economics can only be a case of temporary "disequilibrium", is now with us for keeps.
While the uprooted black cottonpicker of the 1940s might have found a place on a Chrysler assembly line and the displaced production-line worker of the 1960s a job in a service industry or government, today most industries are "downsizing" and there's no new industry generating enough jobs to offset this trend.
Desktop publishing, financial services and internet software supply are all "growth areas", but the rate of creation of their new jobs falls ever more behind the rate of elimination of the old. US Steel now produces the same amount with 20,000 workers as it did with 120,000 workers in 1980.
As a result, "full employment" gets redefined from one recession to the next as 5%, then 6%, then 7% official unemployment. Among oppressed minorities and migrants, what gets passed down from one generation to the next isn't the family trade or profession, but joblessness.
Automation, robotisation and ever more powerful and sophisticated machinery mean that in the US alone 90 million out of a present 124 million jobs are vulnerable to replacement by machines: a recent study by the International Metalworkers Federation forecasts that within 30 years as little as 2% of the world's current labour force "will be needed to produce all the goods necessary for total demand".
Rifkin reinforces his argument with a survey of other potential sources of employment:
Government? Most are running deficits and trying to get lean and mean in the brave new world of global competition.
Expanded foreign markets? New markets continue to emerge, especially in Asia, but competition to fill these is intense, often able to be met out of existing idle capacity, and not everyone can be winners.
Expansion of consumer, commercial and government credit? The limits of personal, corporate and government indebtedness are now close, with, for example, the average US household spending 25% of income paying off credit card debt.
Increased wages? While the most highly automated and efficient firms and sectors can always afford to pay higher wages, these are a minority. The consumption based on these sectors is far from sufficient to stimulate the across-the-board growth needed to cut back joblessness.
A new investment boom? Unlike three previous technological revolutions, the level of investment generated by computerisation and robotisation doesn't involve a fundamental renewal of plant and infrastructure, being as much "capital-saving" as "labour saving". Hence it hasn't produced the kind of growth in industry work force that would offset job losses in declining sectors.
Why now?
But why is the new technology and "work re-engineering" being introduced at such a rapid rate now? Rifkin doesn't tackle this question because he assumes that in general the latest technology will just get introduced, unless union action can stop it. (He doesn't note, for example, that after monopolies and oligopolies have invested vast sums, they have an interest in defending their newly won technological lead. This can result, as it did in the 1930s, in the use of corporate power to suppress new technique.)
Rifkin points to the huge leaps in productivity that the introduction of computer technology has allowed but notes that this came in two stages. First, in the 1980s and despite an investment of some $1 trillion in new information technology in the US, there was low growth (around 1% a year) in productivity. The big gains came with the 1989-1992 recession, when corporate capital launched a wave of "job re-engineering" and "downsizing" that made product per worker-hour rise at 2-3% a year.
Intensified competition for stagnant or slowly expanding markets has forced all firms onto the treadmill of re-engineering to drive down costs. However, Rifkin doesn't acknowledge the political and social preconditions for this shift (in particular the weakening of the unions during the 1980s).
When added to the lift in profit rates achieved by grinding down wages during the 1980s, these productivity gains have helped capital fulfil one of the two preconditions for a new long boom — a big lift in the rate of profit. But the other condition, an expansion in overall demand, still eludes it.
Such analysis takes us well beyond Rifkin: for study of the relation between the pace of introduction of new technology and the rate of profit, and between these two phenomena and the balance of class forces leads to the understanding that the underlying cause of the jobs holocaust is production for profit, and the only abiding solution the elimination of the profit system.
Solutions?
Given this analytical weakness, it's no surprise that the feeblest part of The End of Work regards solutions. Rifkin simply doesn't think through the social and political implications of many of his proposals, especially where the question of "who pays" looms. Time and again, he retreats from this critical issue, covering his withdrawal with sonorous waffle about the seriousness of the crisis.
Most tellingly, his discussion of the politics of the shorter working week is superficial in the extreme. The basic problem is never squarely faced: a shorter working week at reduced pay reduces the living standards of those in work and doesn't lift overall demand; a shorter working week with no loss in pay undermines capitalist competitiveness. So which is it to be?
The main point of Rifkin's argumentation seems to be to convince sceptical corporate leaders (not one US CEO out of 300 recently surveyed by Fortune magazine supported a shorter working week) that this conundrum can be solved.
But the corporate rich remain sceptical. Rifkin quotes one CEO: "My view ... is dramatically opposite of yours. I cannot image [sic] a shorter workweek. I can imagine a longer one ... if America is to be competitive in the first half of the next century."
A classic example of short-term greed blinding the corporate boardroom to its long-run interest? Or someone rather more in touch with the realities of contemporary capitalism than Rifkin? Rifkin simply ends up hoping that corporate USA will become aware (as Henry Ford, who could afford enlightenment, did in the Great Depression) that there has to be enough purchasing power in the economy to absorb all the production unleashed by the technology.
It's a forlorn hope. The company (or national economy) that introduces a shorter working week (or higher wages) to stimulate demand runs a very high risk of losing out in today's shark-eat-shark markets. To forestall such a disaster, some economists dream of a simultaneous, worldwide introduction of the shorter working week — an even more forlorn hope.
Radical solutions
Notwithstanding Rifkin's limp performance here, anyone seriously committed to the shorter working week as the answer to unemployment always runs the risk of making a radical critique of the status quo and at least flirting with radical solutions.
This also holds for The End of Work, some of whose best pages remind us that the biggest shorter working week movement in US history was deliberately derailed by Franklin Roosevelt in 1933. Rifkin also exposess the mainly negative role of labour "leaders" in regard to reduced working hours.
But Rifkin always ducks the revolutionary implications of his own analysis. He combines passivity in the face of "economic trends" (there is no alternative to capitalism) with enthusiasm for pet panaceas.
Rifkin's chapter on the shorter working week ends with the prediction that "the call for a shorter workweek has many attractive features and will likely be implemented in countries around the world by the early years of the twenty-first century".
Totally lacking is any sense that the shorter working week has been, and will always be, won by the only social agent with the social power and organisation to achieve it — the "global labour force" aware of and acting in its own interests. n