Sharing the benefits

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It’s more than 60 years since Parkinson came up with his famous law that "work expands so as to fill the time available for its completion".  I’m not sure that it’s ever been scientifically ‘proven’, but for most of us it seems to have a ring of truth about it in many workplaces, in offices at least.  The underlying problem that it highlights is the difficulty in measuring the productivity of many activities.  In essence, productivity is simply output divided by input, and in a widget factory it’s fairly easy to measure both and thus assess productivity – it’s simply the number of widgets produced divided by person hours to produce them.  (In passing, it’s worth noting that that isn’t quite the way in which overall productivity of the economy is calculated, but that’s for another day.) 

In an office environment, however, measuring ‘output’ is a great deal harder to do, which is why many lazy employers don’t even try.  Instead, they put their efforts into managing the input side of the equation: controlling the hours put in by employees, managing sickness absence, dealing with a lack of punctuality.  There’s an underlying and unstated assumption that if they can maximise and control the input then the output will take care of itself.  It’s an invalid assumption, and in some cases over-controlling the input side of the equation leads to a disempowered, or even demotivated, workforce which feels, rightly, that management don’t trust them to get on with the job; and the probable impact of that on output (and thus productivity) is more likely to be negative than positive.

That’s something of the context within which the TUC this week called for a move towards a four-day week rather than a five-day one.  The BBC report tells the story of one company which switched to four-day working and found that they were achieving as much as they had before.  From simple observation over the years, I suspect that would be true of many workplaces.  ‘Presenteeism’ is a growing problem, and the number of employees who believe that they should be seen to turn up before the boss and not leave until after (s)he has gone home is far too prevalent.  It leads to some people working long hours involving what is often unpaid overtime, but I’m not at all convinced that it adds anything to output.  Instead, the Pareto Principle applies: staff achieve 80% of their overall impact in 20% of the available time; the remaining 80% of their time is taken up by often trivial activities having little overall impact.  Presenteeism merely adds to the time used for not particularly productive activity.

It’s not clear yet to what extent automation will replace much of the routine work undertaken by staff in offices.  Again, it’s easier to see the impact of automation in a widget factory.  I suspect, however, that most people are underestimating the extent to which technology will be able to replace much of the work currently done, as well as underestimating the rate at which that change will be upon us.  The TUC talk about sharing the benefits of technology with the workforce; reducing the length of the working week is one way of doing that.  It strikes me, though, as a wholly inadequate response to the impending changes which technology will bring.  The challenge is not just about sharing the benefits in the workplace, it’s about sharing those benefits more widely across society.  I suppose it’s close to inevitable that an organisation composed of the representatives of working people will be prioritising the interests of those working people; but there are a lot of people in society who aren’t in that category who will also be affected.  And that number is likely to grow.

Some politicians talk about automation as though it’s similar to changes of the past, as a result of which many jobs disappeared but were replaced by new jobs and new types of jobs which hadn’t even been imagined previously.  They may be right, and if they are I may be worrying unduly.  I have a feeling however that the change we are now facing is of a different nature – even if new types of organisation supplying new types of services emerge, the potential is there for many of them to be automated too.  In theory, those who own the machines can produce goods and services with little dependence on employees, and the benefits of automation accrue to the machine owners.

Things aren’t quite that simple, however, and the advance of technology highlights the underlying problem with the capitalist economic model.  For those organisations adopting the technology first and moving away from dependence on human employees there are potentially huge advantages.  But if everyone does it, and there are no employees left, who has the money to buy the goods and services?  What looks good for an individual capitalist simply doesn’t work when applied to the economy as a whole.  That has always been the flaw in the model but continued economic growth has disguised it.  I paint an extreme picture to make a point, but unchecked automation with all the benefits flowing to the automators ultimately fails.  The TUC are right to argue that the benefits of automation should be shared more widely; if anything, their proposals strike me as being rather timid.  What they are suggesting is in the interests of the capitalists as well as the workers, but I don’t expect the capitalists to recognise that just yet.  There is a wider political question as well – what are politicians going to do to ensure that the benefits are shared rather than accruing to one group alone in the short term?  Merely assuming that there will be new jobs to replace the old looks is not just complacent - it’s more a dereliction of duty.

Welcoming the robots

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Last week, the Governor of the Bank of England issued a pretty dire warning about the potential impact of automation.  It could, he said, cost up to 15 million jobs over time.  And he isn’t just talking about monotonous repetitive jobs like widget-making either; even skilled knowledge-based jobs are at risk as the technology gets ever cleverer.  I suspect that he’s being over-optimistic; the speed at which technology is advancing is hard for many to take in, and could lead to many more job losses than that.  As one small example, just a few years ago, the idea that vehicles would be able to drive themselves seemed like the stuff of science fiction, but in the near future we will probably be wondering why we ever allowed error-prone humans to control something as dangerous as a vehicle in the first place.

From the point of view of individual companies, the attractions of automation are obvious – uncomplaining machines turning out prodigious numbers of widgets 24 hours a day 365 days of the year has to be better than dealing with people with all their foibles.  But I wonder if the outcome for producers of goods and services as a whole, rather than as individuals, is quite so rosy; if we really do lose 15 million jobs, who is going to have the money to buy all those widgets?

Carney was arguing that the government and corporations have a duty to help people manage the change, not least because those job losses are likely to happen before the new jobs (and new types of jobs) are created.  That seems reasonable in itself, but my question is about how realistic it is to expect that there will be lots of new jobs created.  It’s an essentially unanswerable question.  Guided by experience, technological revolutions have always led to new jobs eventually - but there’s no inevitability about something happening in the future just because it’s always happened in the past.  Simply assuming that it will owes more to faith than to logic.

There may, as the article suggests, be jobs building the robots and training the AI, but from what I know of technology, I’m not convinced that it won’t advance so quickly that even those jobs will themselves be automated.  Why would they not be?  (And even if they’re not, is it realistic to assume that everyone can be trained to build robots and train AI?)  The logical outcome of every individual enterprise gaining from shedding employees and automating its processes is that all of them lose in the end by destroying their customer base.  Isn't that, in essence, what Marx was referring to when he talked about capitalism containing the seeds of its own destruction?

The implication of what Carney was saying is that governments and corporations should take steps to help manage the temporary gap between the disappearance of the old and the emergence of the new.  If we assume that there is a ‘new’ to emerge, that is sensible and reasonable – but what if that assumption is wrong?  If, in reality, those jobs are going to disappear never to be replaced, how do we as a society adapt to a situation where the demand for people to do work is significantly and permanently reduced? 

The answer depends on how we decide to share out what work is available – and to what extent it can be shared anyway; not everyone is likely to be able to be trained as a brain surgeon, for instance.  I have suggested previously, not entirely  tongue-in-cheek, that people who choose not to work are doing the rest of us a favour; when there aren’t enough jobs to go round, choosing to live on a low income without working could almost be seen as a form of altruism.  But paying a significant section of the population not to work is actually one possible, and entirely rational, response to a permanent reduction in the demand for work.  Doing more to share the work out is another.

It’s ideology, not economics, which drives the idea that everybody should be working, and that those who don’t – because they can’t, or won’t, get a job – are somehow beyond the pale.  A future in which machines do most of the work and humans have more leisure time to seek personal fulfilment in other ways might sound like the science fiction I referred to earlier, but if it becomes technically possible, why wouldn’t we choose it?  It requires a paradigm shift, certainly – but a paradigm shift may be the inevitable result of 15 million job losses.  We really need to be thinking through the possible responses before it happens because perhaps capitalism really will destroy itself.