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Forums - Politics - Why isn't perpetual high unemployment inevitable?

richardhutnik said:
scottie said:
For every person that is no longer needed in agriculture, or manufacturing, more are needed in other fields. Sustainability is the biggest boom at the moment, before that it was online serivices. before that it tourism, fuelled by affordable air travel. Before that was the entertainment industry.

Sustainability (green) is alternate energy sources and also more efficient building materials to conserve on energy sources.  How is this anything quantifiably new, and not just the reshuffling of old skills?


Hmm? I'm not sure what you mean. From what I can gather, the point of your first post was that the increased efficiency with which modern societies farm and manufacture means that we can, as a society, get as much done with high unemployment as our ancestors could with low/no unemployment?

 

To which my response was, that instead of being content accomplishing as much, and thus letting unemployment build as efficiency builds up, in the long term, our society chooses to get more done and thus keeping unemployment under control.

 

As examples of the new things our society has chosen to do, I gave sustainability projects, entertainment, tourism. 



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To quote (the guy playing) Hayek in that economic rap song:

"Jobs are a means, not an ends in themselves. People work to put food on their shelves"

Basically, there will be a point where the demand for employment will drop (we already have massive unemployment on a global scale - that's why 2 billion people live in poverty), instead of rise. As is stands, this is not yet the case - global unemployment is still falling at a rapid rate (I remember reading that a million people a week are pulled out of poverty in China alone). In fact, the long term trend still shows that for each job taken, a new job is created.

Unemployment doesn't have to equal bad. Remember that the average worker is now a lot less "unemployed" than he was centuries ago. People used to have to work 7 days a week toiling the fields, dawn to dusk - start work at ages such as 12, and not finish until you die. Now, most people work 5 days a week, 9-5, with breaks, holiday, entitlements (sick, maternity/paternity), most don't enter full time employment until their early 20s, and most retire between the ages of 60 and 70.

Why do you seem to fear that automation and increases in labour productivity = bad for everyone? Wouldn't it be better if people could continue to live better and better lives (that the cost reductions and better innovations of greater productivity allows), and also reduce the amount of time that they work? Wouldn't it be better for families, if they went back down to only having one parent work, and the other parent working significantly less? If, when people retire, they get 30 or 40 years, rather than 20. If, the education system wasn't just geared at producing workers, but also able to allow children to explore their true talents?

Now, this may seem pie-in-the-sky, but it's actually what the long-term trends show is likely to happen, as productivity increases.



scottie said:
richardhutnik said:
scottie said:
For every person that is no longer needed in agriculture, or manufacturing, more are needed in other fields. Sustainability is the biggest boom at the moment, before that it was online serivices. before that it tourism, fuelled by affordable air travel. Before that was the entertainment industry.

Sustainability (green) is alternate energy sources and also more efficient building materials to conserve on energy sources.  How is this anything quantifiably new, and not just the reshuffling of old skills?


Hmm? I'm not sure what you mean. From what I can gather, the point of your first post was that the increased efficiency with which modern societies farm and manufacture means that we can, as a society, get as much done with high unemployment as our ancestors could with low/no unemployment?

 

To which my response was, that instead of being content accomplishing as much, and thus letting unemployment build as efficiency builds up, in the long term, our society chooses to get more done and thus keeping unemployment under control.

 

As examples of the new things our society has chosen to do, I gave sustainability projects, entertainment, tourism. 

What I mean is that the nature of sustainable technology is such that you can retrain workers in current industries to do the same work.  The amount of labor required doesn't increase.



SamuelRSmith said:
To quote (the guy playing) Hayek in that economic rap song:

"Jobs are a means, not an ends in themselves. People work to put food on their shelves"

Basically, there will be a point where the demand for employment will drop (we already have massive unemployment on a global scale - that's why 2 billion people live in poverty), instead of rise. As is stands, this is not yet the case - global unemployment is still falling at a rapid rate (I remember reading that a million people a week are pulled out of poverty in China alone). In fact, the long term trend still shows that for each job taken, a new job is created.

Unemployment doesn't have to equal bad. Remember that the average worker is now a lot less "unemployed" than he was centuries ago. People used to have to work 7 days a week toiling the fields, dawn to dusk - start work at ages such as 12, and not finish until you die. Now, most people work 5 days a week, 9-5, with breaks, holiday, entitlements (sick, maternity/paternity), most don't enter full time employment until their early 20s, and most retire between the ages of 60 and 70.

Why do you seem to fear that automation and increases in labour productivity = bad for everyone? Wouldn't it be better if people could continue to live better and better lives (that the cost reductions and better innovations of greater productivity allows), and also reduce the amount of time that they work? Wouldn't it be better for families, if they went back down to only having one parent work, and the other parent working significantly less? If, when people retire, they get 30 or 40 years, rather than 20. If, the education system wasn't just geared at producing workers, but also able to allow children to explore their true talents?

Now, this may seem pie-in-the-sky, but it's actually what the long-term trends show is likely to happen, as productivity increases.

You speak of retirement.  What happens if people can't afford to retire?  If you run a free market system, and no welfare safety net?  No one can ever afford to retire (retirement means to be financially independent), and social security in America shuts down?  People work until the day they die, and have to?  Retirement is catastrophic health insurance where you are physically unable to work, rather than you become financially independent.  The way the current debate is happening in Washington, look for retirement to be shortened, not increased.  In addition, no one is paying pensions any more, so that income is out.  

The reality is that "true talents" in a free market economy are only worth anything if people are willing to give you goods and services in exchange for them.  And, unless there is some sort of concensus as to what society should preserve, don't expect any government funding for them.

On reduction of the number of hours needed to work, if there is a large pool of labor available, then the rate of pay for the work is low, and not enough to sustain people.  It would mean people would also need much longer hours, and if there is just in time labor, in the services market, where an employer expects people to be available on call within a few hours, then having multiple employers ends up an issue.  People will need to hold down 5 jobs just to survive and may not even get that.

And what you wrote about worked when you had unions and there was a shift from agriculture and manufacturing, people had pensions and lifetime employment.  Now it is increasingly short-term everything.



richardhutnik said:
SamuelRSmith said:
To quote (the guy playing) Hayek in that economic rap song:

"Jobs are a means, not an ends in themselves. People work to put food on their shelves"

Basically, there will be a point where the demand for employment will drop (we already have massive unemployment on a global scale - that's why 2 billion people live in poverty), instead of rise. As is stands, this is not yet the case - global unemployment is still falling at a rapid rate (I remember reading that a million people a week are pulled out of poverty in China alone). In fact, the long term trend still shows that for each job taken, a new job is created.

Unemployment doesn't have to equal bad. Remember that the average worker is now a lot less "unemployed" than he was centuries ago. People used to have to work 7 days a week toiling the fields, dawn to dusk - start work at ages such as 12, and not finish until you die. Now, most people work 5 days a week, 9-5, with breaks, holiday, entitlements (sick, maternity/paternity), most don't enter full time employment until their early 20s, and most retire between the ages of 60 and 70.

Why do you seem to fear that automation and increases in labour productivity = bad for everyone? Wouldn't it be better if people could continue to live better and better lives (that the cost reductions and better innovations of greater productivity allows), and also reduce the amount of time that they work? Wouldn't it be better for families, if they went back down to only having one parent work, and the other parent working significantly less? If, when people retire, they get 30 or 40 years, rather than 20. If, the education system wasn't just geared at producing workers, but also able to allow children to explore their true talents?

Now, this may seem pie-in-the-sky, but it's actually what the long-term trends show is likely to happen, as productivity increases.

You speak of retirement.  What happens if people can't afford to retire?  If you run a free market system, and no welfare safety net?  No one can ever afford to retire (retirement means to be financially independent), and social security in America shuts down?  People work until the day they die, and have to?  Retirement is catastrophic health insurance where you are physically unable to work, rather than you become financially independent.  The way the current debate is happening in Washington, look for retirement to be shortened, not increased.  In addition, no one is paying pensions any more, so that income is out.

The reality is that "true talents" in a free market economy are only worth anything if people are willing to give you goods and services in exchange for them.  And, unless there is some sort of concensus as to what society should preserve, don't expect any government funding for them.

On reduction of the number of hours needed to work, if there is a large pool of labor available, then the rate of pay for the work is low, and not enough to sustain people.  It would mean people would also need much longer hours, and if there is just in time labor, in the services market, where an employer expects people to be available on call within a few hours, then having multiple employers ends up an issue.  People will need to hold down 5 jobs just to survive and may not even get that.

And what you wrote about worked when you had unions and there was a shift from agriculture and manufacturing, people had pensions and lifetime employment.  Now it is increasingly short-term everything.

The idea is that, before we get to a period where the demand for employment starts declining on a terminal levels, the supply of labour would have already been long-declining. If the supply starts decreasing before the demand decreases, then the price of labour increases. Wages go up, as a result, people will choose to work fewer hours, anyway, further reducing the labour supply.

By this point in time, social security would be long dead, and, frankly, I expect that many, many people WILL be more financially independant. Most will still be able to retire at a fairly decent age, few won't. However, the net result will still be greater for society. If people are intelligent with their money, and practice good finances, anyone at just about any level of income can become financially stable. Those who fail to learn the skills of saving, investment, and cost-cutting will have to pay for it by having to work more years.

Unions exist, and will forever exist. Many are far more powerful today than they were during the shift from agriculture to manufacture, the problem isn't a decline in union action, or short-termism, the problem is that far too many people are lazy with their money, and would rather have somebody else do their savings and investments for them. If we don't give people those options, they'll be forced to do these things for themselves, and, generally, would be better off for it.



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richardhutnik said:

What I mean is that the nature of sustainable technology is such that you can retrain workers in current industries to do the same work.  The amount of labor required doesn't increase.


But it doesn't decrease either, hence why unemployment isn't more prevalent



scottie said:
richardhutnik said:

What I mean is that the nature of sustainable technology is such that you can retrain workers in current industries to do the same work.  The amount of labor required doesn't increase.


But it doesn't decrease either, hence why unemployment isn't more prevalent

Same amount of labor here is total number of people employed, not percentage of the population.  If the amount of labor required by an industry remains flat, and population increases, the amount of unemployed increases.  What I am looking at here is trends in what is going on, and seeing if there is alternatives to counter this.  What I have seen is speculation on what might be needed more of, not what actually is.  

While it might end up being yet another thing that reduces total amount of labor, but it looks like the human race is now stuck on what can be next, and equivalent to the Internet, that fundamentalloy shifts the way things would be and the demand for labor, like the Internet did, which did create a lot of new jobs.  Part of my asking is what is quanitifiably different than what we have now coming down?  Tourism doesn't seem to be an answer.



richardhutnik said:
scottie said:
richardhutnik said:

What I mean is that the nature of sustainable technology is such that you can retrain workers in current industries to do the same work.  The amount of labor required doesn't increase.


But it doesn't decrease either, hence why unemployment isn't more prevalent

Same amount of labor here is total number of people employed, not percentage of the population.  If the amount of labor required by an industry remains flat, and population increases, the amount of unemployed increases.  What I am looking at here is trends in what is going on, and seeing if there is alternatives to counter this.  What I have seen is speculation on what might be needed more of, not what actually is.  

While it might end up being yet another thing that reduces total amount of labor, but it looks like the human race is now stuck on what can be next, and equivalent to the Internet, that fundamentalloy shifts the way things would be and the demand for labor, like the Internet did, which did create a lot of new jobs.  Part of my asking is what is quanitifiably different than what we have now coming down?  Tourism doesn't seem to be an answer.


Except that, while the quantity of people required by particular industries stagnates or shrinks all the time, new industries promoting new products and services are being formed all the time ...

Since James Watt invented the steam engine in 1775 we have experienced a much more rapid increase in productivity from generation to generation that has allowed people to provide more goods and services in less time for a lower cost; and, inspite constant predictions that we would eventually see high unemployment in the future, we have not seen this materialize even though productivity has increase by more than 10 times. The growth in people's desires has always exceeded growth in productivity, so as jobs are eliminated new jobs are (almost) immediately created to meet the unsatisfied desires of the population of the world.

Even if something unprecidented happens and people decide that their standard of living is high enough and productivity is used to reduce the amount of work the average person does in a week, the increased free time people have will require new products and services (primarily entertainment related) to satisfy these people.



HappySqurriel said:
richardhutnik said:
scottie said:
richardhutnik said:

What I mean is that the nature of sustainable technology is such that you can retrain workers in current industries to do the same work.  The amount of labor required doesn't increase.


But it doesn't decrease either, hence why unemployment isn't more prevalent

Same amount of labor here is total number of people employed, not percentage of the population.  If the amount of labor required by an industry remains flat, and population increases, the amount of unemployed increases.  What I am looking at here is trends in what is going on, and seeing if there is alternatives to counter this.  What I have seen is speculation on what might be needed more of, not what actually is.  

While it might end up being yet another thing that reduces total amount of labor, but it looks like the human race is now stuck on what can be next, and equivalent to the Internet, that fundamentalloy shifts the way things would be and the demand for labor, like the Internet did, which did create a lot of new jobs.  Part of my asking is what is quanitifiably different than what we have now coming down?  Tourism doesn't seem to be an answer.


Except that, while the quantity of people required by particular industries stagnates or shrinks all the time, new industries promoting new products and services are being formed all the time ...

Since James Watt invented the steam engine in 1775 we have experienced a much more rapid increase in productivity from generation to generation that has allowed people to provide more goods and services in less time for a lower cost; and, inspite constant predictions that we would eventually see high unemployment in the future, we have not seen this materialize even though productivity has increase by more than 10 times. The growth in people's desires has always exceeded growth in productivity, so as jobs are eliminated new jobs are (almost) immediately created to meet the unsatisfied desires of the population of the world.

Even if something unprecidented happens and people decide that their standard of living is high enough and productivity is used to reduce the amount of work the average person does in a week, the increased free time people have will require new products and services (primarily entertainment related) to satisfy these people.

How about 99 cent phone apps that only require a team of a half a dozen people, for free or for sale for 99 cents, based on Android or open source, and where you don't need a lot of people?  You know, the entire planet gets into Angry Birds, or ends up playing Freecell or Minesweeper?  People decide not to update their current technology, and stick with what they have?  In short, it doesn't require more labor than employed now but is used more.

Also, where does increased free time indicate that people will be able to afford to spend money on anything?  They could look at much lower incomes, and thus adjust their lifestyles accordly, as I know I have.  You think I am buying a 3DS at this point?  Sorry, no money for it.  Money goes for keeping the car on the road.



spurgeonryan said:
People in Farming or agricultural jobs these days are making bank, at least in America they are. Corn being used for everything, soy, etc is just driving prices!


If you truely believe that, then you have obviously not grown up, worked or seen most non-corporate farming operations.  For your average, family-run operation, farming is a yearly gamble with your entire livelyhood.  Equipment prices are outrageous.... a quality combine harvester costs more than the houses of most people... so you have to take loans.  If the crops fail (heat, drought, disease etc.) then you have steep bills to pay with little means to do so.  Profit on range lands isn't much better.

Large corporate farming operations are another matter, but (even in that case) it certainly isn't the workers who are getting rich.  The shareholders and board of the company are.  Lowly workers are not getting paid any more than workers in any other sector. 

The reason that most farms have been consolidated and purchased by big business is exactly because it is so risky and most farmers (in the sense that they have existed for the vast majority of the history of the USA) can no longer afford the gamble.