The Problems of Improving the Efficiencies of Labour

A force of change looms over our global economy that history has not prepared us for. I eluded to this issue while describing my utopian business model however I did nothing more than mention its potential to disrupt the suggested system. Although only a short time has elapsed since I first recognized the issue it has become apparent that rather than being a far off problem to be faced by future generations it is already starting to take noticeable effect. As with most economic things there are good aspects to the issue as well as detrimental ones and at first glance the good ones may seem to outweigh the bad. The issue I am talking about is the growing power of labour although it could be framed in many different ways such as the ratio of employment to GDP. It is not so much the improvements to labour efficiency themselves that are causing the problems but the relation of those efficiencies related to our consumption and our supply of resources.

Humanity has always been able to excel through use of tools, in many ways they define our recent evolution far better than biology is able. The better our tools the greater are our achievements and quality of life. Not only have our tools gotten consistently better, the rate at which they are advancing is increasing, as has been the general trend over our history. Each improvement to a tool, be it a computer program, a high speed rail network or a simple electric drill makes the labour output of those who use it more efficient. This has historically been exclusively good (disregarding our impact on the environment) for humanity however we are fast approaching a point at which it is starting to have downsides.

There are two main downsides and also two relevant stages at which to look at this problem. It is worth looking at the immediate effects upon current society but also worth considering the ultimate sci-fi utopian possibility. The two downsides are the decline in jobs through lowering labour requirements and the polarization of power due to the ever decreasing number of people responsible for key goods and services. Humanity must be best served by improving our tools, technologies and methods and so we must look for solutions to the new problems they bring. Imagine a world where AI and robotics have reached the point of being able to perform the vast majority of tasks better than humans, both cheaper and faster. Assembly lines already produce many of our goods and so the leap in imagination to where they have basically no human operatives is not a big one. When they are able to create robotics that able to create more robotics and when AI is capable of design and other overseeing roles there will be far fewer spheres in which human labour is useful.

We are at a unique turning point in history. Previously any improvements made to essential labour such as growing food resulted in that labour moving to another non-essential sphere such as production of luxury goods. This has simply meant GDP has risen (averaged out over a very long time frame) alongside quality of life without dramatic effect on the percentage of employment. The turning point is that our consumption of energy and resources that are going in to the combination of essential and not essential labours has reached the capacity our environment can support. We cannot simply continue to become more productive in our labour and expect that return to come back to us with a full yield. The analogy that springs to mind is that of a plant which needs both water and light to grow. To a point increasing how much light the plant gets will aid its growth however further addition quickly has no effect as it will be capped by how much water the plant has access to. Our efficiencies of labour are the plants light and our environment/resources are the amount of water available to us acting as a cap. We either need to find new sources of “water”, which could be harvesting the resources of other galactic bodies, or we need to become more frugal in how we utilize the “water” available to us. As it stands we are continuing to shed more light, if I may stretch this analogy out, on our production efficiencies which will decrease the required amount of labour to support our present economy, infrastructure and society reduce the total number of available jobs. Unlike in the past however there is not enough water for those whose labour becomes surplus to simply do something else. It is not that the improvements we make are detrimental, only that our old ways to deal with the changes will no longer continue to work. For future growth to continue in the same manner as historic growth we must find ways to improve our energy and resource output alongside any increases to the efficiency of labour.

A simple solution to a decrease in jobs is to reduce the labour output of people, say a reduction in the working week. The problem with this sort of blanket approach is that it affects different people and roles very differently. Certain high paid jobs need continual overseeing and already disregard conventional working hours. This wouldn't change at the top end of employment without strict enforcement. If it didn't change it would stand to further increase the wealth gap within society. If however you enforce a reduced working week then you will adversely affect the economy leaving you with the age old right and left wing struggle. Taking quite a simplified view of things, if you reduce the hours people each give to their jobs by half you would need twice as many people to do the same amount of work. This would mean twice as much training would be needed, experienced gained would be half the speed and the quality of applicants within roles would be lower. It is more efficient to have each job done by the best person available, each giving as much time to the role as possible. The loss of efficiencies through a reduced working week would be most notable in the very top professions which in turn have the most impact on the economy of a society. Much like the right wing argument against high taxes on high earners, if you restrict the top everything below it suffers.

An alternate solution would be to expend surplus labour into the efficient use of resources and energy. As previously mentioned, our available energy and resources are the cap preventing us from continually directing unessential labour towards producing luxury. This would help in providing an alternate yet productive use of labour that didn't escalate the problem and would in turn allow more people to be employed in creating luxury. We are of course starting to do this with recycling and solar panels etc, much like people are working less hours with ever more people in part time work. The problem with recycling and other endeavours of this kind is that many of them are so inefficient themselves that they are ultimately counterproductive. Until recently they have been outside the influence of capitalism and as such no incentives were provoking radical improvements to those kinds of industry. As a result we have a relatively token gesture which seems to be there mostly so the rich west can feel good about themselves rather than actually doing anything of real value. Within any current economic system the only sensible way of tackling this problem is by imposing subsidies and taxes for sustainable products and depleting resources respectively. The utmost of care is needed in any impositions of free trade such as this as they can so easily upset the benefits one expects from capitalism. Such taxes and subsidies if imposed on the right area will focus the improving effect of capitalism into the the efficiencies of energy and resource consumption and help to make it a financial viable exercise rather than a token gesture. Without such a fiscal intervention from governments the appropriate forces of capitalism will not be attained until we have sufficiently depleted our supplies and will run the risk of not having enough time to make comfortable changes. Change is good, but changes too fast will leave a wake of devastation which is best avoided.

While applying financial pressure towards more resource efficient practices and allowing for optional and liveable part time work within society to ease the problems of job loss in the current climate, it will have the opposite effect on the wealth gap in that it will create further problems. In my essays it is assumed that a large wealth gap is a detriment to society however no wealth gap is also a detriment to society. Although very hard to state the correct spread of wealth within a society it would be fair to assert that the gap is too high throughout the world today. Sensible countermeasures to job loss caused by the improvement of labour past peak oil send the wealth gap further in the wrong direction. In addition to this the improvements of labour themselves directly increase the wealth gap within a capitalist society. This is due to the fact that it is typically the tools and infrastructure that allow for labour to become more efficient and not the advances of the workers themselves. These tools and infrastructure are owned by the companies and shareholders and while they may need operating and maintaining they do not suffer the same supply and demand power struggle with the company in question as a workforce does. By owning more useful infrastructure and employing less workers the power balance shifts in favour of the owners of the capital. They can dictate more the state of wages and the conditions of work and should in theory, assuming the tools are indeed more efficient, get a larger profit margin for their produce. This all means more money flowing to those already with much capital and less money flowing to fewer people at the bottom end of the wealth gap.

Countermeasures to a naturally increasing wealth gap are the subject of many of my essays and tend to be a generic solutions to the problem. The only specific relevance they have to the subject of this essay is that circumstances are poised so that we should notice an increase to the rate of growth of the wealth gap. I can think of no way of specifically targeting the effect of more efficient labour on the growth of the wealth gap and so the best we can do is be aware of its effects and be more serious about applying the various broader ways of reducing a wealth gap within society. The concern is that few of the best solutions come without a cost of their own or a requirement for significant social upheaval which when placed on top of the other dramatic social changes under way presently, from exciting ones like the internet, to frightening ones forced upon us by circumstance such as the rapid decline in resources, could all to to a rather chaotic period in history.

Taking the idea of an ever increasing trend towards more efficient work to its ultimate conclusion you reach a kind of material paradise in may ways like the fictional race created by Ian M Banks called the Culture. In such a world there could literally be no need of work performed by anything other than machines. Certainly this would have its upsides but as with all things it would come along with some darker consequences as well. Firstly we would need to find a sensible means of usefully occupy people in a fulfilling manner or evolve to a stage where many instinctive behaviours are lost. Without a means of fulfilment and a way to usefully spend time I fear many people would suffer from unusual kinds of mental health issue. The other concern would be that the ownership and control of the machinery responsible for the upkeep of society would offer unreasonable power. Trying to turn our capitalist society into this work free paradise would result in some awkward point down the line where large companies evolve from simply wielding a great deal of power to actually acting more like the kings of old. It is not inconceivable that one day a real war could be fought between two companies instead of two countries. Monopolies are dangerous to society when it is just the market share they have a hold over, I dread to think what the profit driven motives of an organisation with a monopoly on an essential workforce could do. As we move towards this period in history we best think of how our companies and tools can best serve society and prevent a situation where it is the other way around.

While this is all quite far fetched it is not irrelevant for consideration. With the speed of growth and change we are in no great place to predict what things will look like that far into the future. If we do not look at where our progress might take is it could be too late when we realise the world is effectively under the control of a corporation rather than any conventional government. I have always thought I was against the restriction of power as it is effectively a restriction upon freedom however when the wealth gap is no longer an issue because the power gap is so severe you have reached a point where the freedom of a few is a limitation on the freedom of others and must be interfered with. One of the main strengths of a democracy is that it divides the power far more evenly across the populace. Power comes in many guises and that of wealth already disrupts the democratic balance. I suspect that the sheer power of work output when concentrated into the hands of the few trumps that of simple ethereal wealth. This especially so the case when it is one of the key services such as communication, military, transport, power production, other utilities and food production.

Fundamentally the point of this essay is to show how the things that appear good for society will always come with a downside to them that must be foreseen and countered. Something as innocuous as the improvement of tools within society has far reaching implications that shouldn't mean improvements are not worthwhile but that will set you back if not accounted for. Unfortunately society is rather like the individual in that it needs to make its own mistakes before it can properly learn the lesson and adapt. The recent financial collapse is an example of where we took the good parts while neglecting the bad until it came to a head which forced rapid and unpleasant change.  The decline in resources is upon us but seems to be going slow enough for capitalism to solve without too much fallout. As for the rise of the labour owning super companies, it is still a long way off and would be somewhat wasteful to attempt to try and counter before any minor effects are felt. I suspect the most appropriate periods in history to study the economic effects of capitalists owning labour would be those where slaves existed, certainly during the Roman Empire there were problems associated with an abundance of slaves taking the jobs of the Roman citizens.