By Peter Boyle
There is a popular awareness that rapid technological advances will mean a total redefinition of our lives and, in particular, a redefinition of "work". In the optimistic scenario, we will all do less boring work, we'll have flexibility of hours, we'll be able to work from home if we choose to, and we will all have more time to develop our individual creativity, improve the quality of our relationships and generally have a better quality of life. A few people have even had a taste of this better life, since the introduction of computers to many workplaces.
But there is a another version of the future. Present high unemployment — predicted to extend into next year — raises the concern that for many people the future may be a life without a job. Further, the deskilling of many people's jobs that has followed the introduction of some new technology and the extension of working hours for many that has come with award restructuring paint a different picture of the future, even for those of us who will have jobs. Technological advancement, it seems from these experiences, cannot by itself guarantee a better future.
A recently released Department of Employment, Education and Training report, "Australia's Workforce in the year 2001", tries to dodge the question of the future of jobs by arguing that this "depends on the long-term path of the business cycle which is unpredictable". However, it assumes that job growth will be boosted if wage restraint/freeze continues and if there is increased "labour market flexibility".
But it doesn't take much specialist knowledge to realise that, if employers, governments and even union officials succeed in simultaneously getting us all to work harder and for longer hours while speeding up the technological modernisation of all industries, there will be fewer jobs to go around. The unemployment queues will keep growing, regardless of the booms and busts of the business cycle.
Unemployment growth
In the last few business cycles in Australia and other industrialised countries, unemployment has increased compared to previous cycles. According to a recent report on unemployment by the Brotherhood of St Laurence, "seasonally adjusted unemployment rates did not dip below 7 per cent of the labour force for the greater part of the 1980s" despite the boom. In the previous upturn unemployment dropped (briefly) to just over 2%, and in the cycle before to just over 1%.
At a recent economic conference in Melbourne University, Professor Bob Gregory, an academic at the Australian National University and a director of the Reserve Bank, warned that Australia might never see 6% unemployment again. When unemployment finally falls, it might hit bedrock at 8%, leaving 650,000 to 700,000 people permanently out of work.
The pattern is the same in all OECD countries taken together. In a special issue on "Work: the way ahead" published in 1986, the London Financial Times concluded "it is already clear that unemployment is no mere product of a cyclical downswing". Nevertheless, "governments in all the main states continue to predict its demise; but they continue to lack proof that it will".
In a paper prepared for the Brotherhood of St Laurence's Child Poverty Review, Dr Louise Crossley surveyed recent studies of the future of work. She concluded: "Without a change in economic circumstances or government policy, it seems probable that the employment environment in the medium term future will continue to be characterised by a shortfall of job opportunities in the overall labour market". Her report was completed before the recession hit.
The Bureau of Labour Market Research estimated in 1986 that the unemployment rate in the 1990s would probably rise to as high as 14.2% and is unlikely to fall below 6%. The DEET report, on the other hand, assumes an average unemployment rate of 6% for the next decade.
Technology
Crossley noted that many who predict a rosy employment future rest their hopes on technological change, which would lead to economic growth which would in turn create more jobs. However, she reported that there were serious concerns that new technology is responsible for such large gains in output that markets are quickly saturated and economic growth achieved without need to employ more workers. In this situation, the argument that economic growth necessarily promotes employment growth is no longer valid.
The Australian Tax Office has introduced widespread computerisation since 1989. It promised its 19,000 workers that the 3000 jobs the new technology would save would simply come out of 6000 new jobs created in the next 10 years. Just three years later, it wants to cut out 5000 of the current 19,000 staff.
In 1980, the Amalgamated Metal Workers Union warned that technological change was eliminating 10 old jobs for every new one created in the metal industry. The figures for employment in Australian manufacturing industry in the two decades before the Hawke Labor government seem to confirm this claim.
Between 1965 and 1982, 150,000 jobs were lost in manufacturing industry. Its share of total employment fell from 28% to 17%. Employment in manufacturing contracted in absolute numbers by 26% — faster than the agricultural sector — between the 1971 and 1986 censuses. Since then, the pace of industry restructuring has increased dramatically because the Hawke government has speeded up the lowering of tariff barriers and more recently because of the recession.
To the extent that new, more modern and competitive firms replace those manufacturing industries now going to the wall, they will require far less labour to produce many times more output. When Toyota opens its new high-tech car plant in Altona, reports the August 14 Financial Review, it will be able to cut down the number of employees in its Australian operations.
Another example is the experience of workers in BHP. In 1982, their unions and the government urged them to accept a halving of the workforce so that BHP could modernise its steel division. Under pressure they accepted, and with government assistance BHP modernised its plant. Nine years later BHP is demanding that another 2000 jobs go.
Strangely, the DEET report does not attempt to evaluate the impact on jobs of technological innovations such as robotics. It simply notes that this is a relevant consideration and estimates the labour-saving rate of technological advancement at 1% per annum.
Part-time work
The logical solution to the displacement of work by technology is to share the remaining work around. In the face of massive unemployment in 1932, an ACTU leaflet urged workers to fight for a 30-hour week with no loss of pay. In the 1970s, under a Liberal government, the metalworkers' union pioneered, and partly succeeded, in a campaign for a 35-hour week in response to high unemployment. But in the face of equally high unemployment under a Labor federal government today, talk of a shorter working week campaign is ruled out of court.
Most unions are now conceding to employers changes in pay and working conditions that are making many workers do a longer working week, 50 hours or even more. For now, much of this is still paid as overtime, but the next stage will be the reduction or elimination of penalty rates.
While the union movement is retreating under cover of confused mumbling about increasing skills, job satisfaction, job flexibility and career paths, the employers have been able to impose a redefinition of working hours on their terms. Work has been redivided into a longer working week for some, part-time work for
many others and unemployment for a growing number.
Since 1983, part-time work has grown at an average of 6.5% per year while full-time work grew by only 2.8% per year. This tendency has been reinforced by the recession. Of the 83,100 jobs lost in July, for instance, 66,000 were full time and only 17,100 were part time.
There is a major gender imbalance in this growing body of part-time workers. Of the 752,500 workers classified as "marginally attached" in September 1990, 74% were women. Women were overwhelmingly employed in the sales, services and clerical sectors, and initially less hit by the recession because the male-dominated manufacturing and building industries were first hit. In July, however, unemployment began to be reflected more in the services sector.
Quality of work
Predictions that technological change would bring an improvement in the quality of working life also seem elusive. Despite much talk of Australia becoming a "cleverer" country, the general tendency has been for the introduction of new technology to result in a deskilling of jobs.
For example, Crossley explains, checkout operators no longer have to be able to add, nor typists to spell, thanks to their computerised cash registers and word processors. Computer-aided design and manufacturing decrease the skill requirements of many technical jobs in industry. Even in computer programming, only one in 10 programmers needs to understand the mathematics of computer languages, since computers are becoming more user-friendly.
"The belief that a high-tech, post-industrial economy will require an overall increase in skill levels in the workforce is based on a confusion between high-tech industries and high-tech occupations", argues Crossley.
The impact of new technology on employment was clearly demonstrated in the banking industry — the subject of a case study by the Senate Standing Committee on Science, Technology and the Environment. Computerised account keeping not only has replaced work previously done by counter staff but has also reduced the skill they require. In addition, electronic data processing centres staffed by part-time or casual operators have replaced much of the more skilled work once done in branch offices.
Tellers are now trapped in low-skilled, low-paid, routine jobs with no career prospects. On the other hand, managerial and specialist staff are increasingly being recruited from tertiary institutions and being paid even more.
The massive expansion of the banking sector that followed
deregulation by the Hawke government in the mid-1980s brought no increase in full-time employment in the sector but a quadrupling of part-time employment.
Another form of work that is growing is "outwork" or work done at home, mostly by women. There are at least 140,000 women working at home for either the clothing or clerical sectors.
The myth is that this is usually a happy accommodation between employer and employee needs, but the reality is less cheerful. A 1989 study of women clerical outworkers found that many earned low, irregular pay, worked under high stress, without benefits such as sick pay, and believed that they could earn more for the same hours if they worked on site.
US experience
The association between new technology and highly skilled work is a pervasive belief. But even in California, home of the "Silicon Valley" ideal of a high-tech future and 20% of all US high-tech industry, this industry employed only 15% of the state's workforce in 1982, and less than a quarter of these employees require any substantial technical knowledge.
Even in the computer and data processing services side of the industry, as opposed to the manufacturing of electronic components, only 25% of jobs are technically oriented. Most of the remainder are clerical or warehouse jobs, or low-skill repetitive process and assembly work.
A study of likely job patterns in the US in the 1990s concluded that, of the 10 occupations that will add most to job growth, none are related to high technology, only two (nurses and teachers) require any post-secondary education, and generally they command 30% less than the average income levels. In short, job growth in the US is expected to be low skilled and low paid. The fastest growing job, in absolute numbers, is predicted to be that of building custodian!
A 1984 seminar into the applicability of these trends to Australia concluded that the same tendencies were likely to be experienced here. In the 1970s and 1980s, the main growth in jobs was at the lower skilled end of the job spectrum, especially in part-time and casual jobs for young people. In the adult labour market, the greatest absolute growth was for cleaners, shop assistants, hospital, security and fast food workers.
The DEET report attempted to make a similar projection for the Australian workforce and came up with startlingly different results. The biggest job growth in absolute numbers, it predicted, will be for sales workers, followed by professionals. Next come tradespeople, clerks, labourers, managers, para-professionals and
machine operators, in that order. Further, in percentage terms, the occupation with the biggest growth will be professionals (33%), a cosy confirmation of the clever country thesis.
Is Australia swimming against the stream, despite its often-stated vulnerability in the harsh process of international economic restructuring? Unfortunately, the DEET reports's optimistic predictions rest on shaky assumptions.
Sacrifice
The argument, put forward by the DEET report, the Hawke government and the Business Council of Australia alike, is that new jobs will be created as we become more competitive and win the battle for exports. If Australia as a whole can produce more and sell more to the outside world, there will be jobs for all and a greater share of the wealth. The reason we have yet to see the fruits of the sacrifices made by most of us in the 1980s is that we still haven't sacrificed enough to make Australia truly competitive, it says.
The first weakness in this course is that, as the DEET report concedes, a shift in resources towards export-oriented and import-competing industries will not result in a significant increase in employment in these industries. Most of the new jobs provided in the next decade will have to come in the service industries. The DEET report counts on high job creation in the recreation, personal and other services sector, followed by construction and wholesale and retail trade, in that order, as took place in the 1980s. Its blindness to the speculative nature of the 1980s construction boom could be fatal to its predictions.
If Australia has only an improvement in the tourist industry to count on for significant job growth, the DEET report concedes that more of the jobs created would probably be low skilled, low paid and part time.
Another weakness in the "more sacrifice" argument is exposed in recent developments in the industrial relations system. The shift away from centralised wage fixing to enterprise bargaining signals a return to the control of wages primarily through the pressure of unemployment. The "new' industrial relations system that is coming into being presumes continuing high structural unemployment.
This is simply the extension of the real process behind the exhortations to Australians to become more competitive — the bringing to bear upon workers in Australia (formerly relatively protected by tariffs and industrial regulation) of the immense pressure of the millions of unemployed and underemployed people in the rest of the world. As a sort of transmission belt of this pressure, a smaller version of this situation is being replicated in Australia in the form of structural unemployment.
Long-term jobless
In the 1960s, when unemployment ranged around the 2% mark, the long-term unemployed (those out of work for a year or more) were only about 5% of the total unemployed. But through the 1970s, as the average level of unemployment rose, so did the percentage of long-term unemployed. By the mid-1980s, nearly one-third of the unemployed had been out of work for over a year.
The last boom cut overall unemployment by half by 1989, but the long-term unemployed were reduced only by a third. Every recession since the 1970s has left a greater residue of long-tern unemployed. Professor Gregory of the ANU estimates that it would take six years of strong recovery to eliminate the long-term unemployed left by this recession.
Recent government labour market programs, such as the Active Employment Strategy (including Newstart) suggest that the problem of jobless growth is primarily one of a mismatch of skills of the unemployed and job vacancies, or a reluctance of the unemployed to seek work. A long list of heavy penalties has been decreed for the "uncooperative"dole recipient.
Meanwhile, the token, short-term but compulsory training offered the long-term unemployed suggests that Newstart has harassment rather than help for the jobless in mind. The fact that there are not enough jobs and that with so many people unemployed, employers are unlikely to choose those who have been out of work longest, seems to be missed.
Richard Gosden argues in an article in the May issue of AES Report (published by the Launceston Unemployed Workers Union) that Newstart is part of the government's plan to place more downward pressure on wages by trying to force the unemployed to work for less money and poorer conditions. It has no value as a solution to long-term unemployment, but it brings the weight of the unemployed more sharply to bear on the workforce.
The future
Taken together, these developments suggest a grim picture of the future. Our society, already heavily stratified (with the top 5% owning 50% of the wealth, while the bottom 50% own 5% of all wealth), looks set to become even more so.
The workforce will be increasingly polarised between a small layer of highly qualified and well-paid professionals and a large layer of mainly female, poorly paid and part-time workers in deskilled, boring occupations. Underneath all of these will be an "underclass" of permanently unemployed people and poor pensioners, sinking even deeper into desperation as the welfare net is steadily dismantled.
Correspondingly, crime and social alienation are set to grow and lead to a strengthening of police powers and surveillance by the state — ID cards, government and commercial accumulation of data on individuals, "accidental" shootings, deaths in custody. To the extent that the state is unable to protect life and property, private security agencies will grow, as will special guarded sanctuaries for the rich.
We see elements of this future in the present, but we can also see a hint of what an alternative future could be like. Technological advancement does offer the prospect that we may be freed from drudgery and long hours of unsatisfying work. It does offer the chance for the majority to develop long-suppressed creativity and new skills. Yet this solution seems inconsistent with the demands of the anonymous "market". As technology advances, some are being commanded to work longer, harder and with greater tedium while others are discarded on the unemployment heap.
The pattern is all the more striking on a global scale. In the late 20th century, entire nations are being thrown on the unemployment and underemployment heap, and a quarter the world's population is experiencing falling living standards. Rationality and humanity would suggest that we find a way to share the work and the fruits of technological advancement around.