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Automation and the Social Contract

Last revised: 25 October 2006

In the "developed" world, jobs are being shed with such rapidity that we may have to create them for the great mass of people in years to come.

Jobs are being lost through automation and offshore outsourcing. Automation is making millions of people around the world redundant by "bridging," by making obsolete, their jobs and sometimes their careers. It is eliminating entry-level work that previously would have allowed the young and the new immigrant to enter the job market and would have provided a vertical ladder of promotion for others to mount.

Automation is obliging many people to cobble together a series of low-paying part-time jobs or a pattern of moonlighting on top of low-paying full-time jobs, to make ends. The people who benefit from the process have used the resulting buyer’s market to break unions, lower wages, end pension plans, reduce benefits, and so on. In the process, a smaller and smaller group of people amass the world's wealth and a larger and larger group of people are looking at what could be a gloomy future.

Work is also being shed because people in business have used the transnational telecommunications networks that have arisen to outsource whatever work can be sent to low-wage areas of the world. Much manufacturing, banking, call-centre, software programming, and other tasks that survived automation have also now gone, further reducing the jobs available to the citizens of the "developed" nations.

Instead of everyone being benefited, as the rosy accounts of automation and the leisure age propagated in the 1950s and 1960s would have had us believe, the means of livelihood are being concentrated in fewer and fewer hands around the world.

In the past, we lived by a social contract in which work provided the means of livelihood. Now, with work disappearing for so many people, either the state will have to fund new areas of work, with money secured from taxing corporations who benefited so much from automation and offshore outsourcing, or else the state will have to break the connection between work and the means of livelihood and ensure that everyone by right has the basic means to live.

Eventually, I can conceive of that right being extended around the world.

With the Baby Boomers approaching old age, we will have a shedding of workers that many economic pundits think will require new recruits through immigration. But I predict that the passing of the Boomers will eliminate the extra manpower made obsolescent by automation and offshore outsourcing. The resulting size of the population, for the jobs available, might have been just right. But, alas, governments are bringing in large numbers of newcomers, for whom jobs do not -- and, I predict, will not -- exist.

Just as we have seen the phenomenon of jobless recoveries in the last thirty years, as automation soaked up work, so we shall see the phenomenon of unemployed immigrants brought here to fill a space left by the Boomers with no space actually arising. Those immigrants may accuse the host society of racist unacceptance of them, when the actuality of the situation is that work has dried up.

Their unemployment will have been produced by poor planning and by the same forces of automation and offshore outsourcing that have been eliminating work for years. Immigrants are being recruited by host countries in the fear and misperception that vacanices will arise with the passing of the Boomers, vacancies which, I predict, will not come about.

Such will be the future misery of the world. Few jobs, many accusations, social unrest, much devastation, eventual social reconstruction. Oh, how sad it is that we do not respond to events like these before the fact or during the crisis. But, alas, we as a world seldom have.

Back in 1990, when I first woke up in a moment of insight to what automation was doing, I tried to interest political and even labour leaders in some response that took into account what was happening to the work force. No one was interested. Everyone was glued to his or her "play station." The benefits of automation dazzled everyone I spoke to.

I still don't think very many people are interested. I still don't believe we will avoid the social cost of violence that we saw in Paris burning last year as unemployed immigrants began to point the finger for their suffering at what they assumed to be racist hiring policies (racism may have played a small part, but the lack of jobs was a far greater factor, I believe). That unrest will spread.

It is anyone's guess exactly how much of the world burning it will take before we see that the way we have gone about fashioning our "progress," at least in the developed countries, has created a massive problem for the world. Another problem we leave to our children.