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The following article appeared in Left Business Observer #72, April 1996. It was written by Doug Henwood, editor and publisher. It retains its copyright and may not be reprinted or redistributed in any form - print, electronic, facsimile, anything - without the permission of LBO.
Another article on this topic, "How jobless the future?," is also on this site.
It's been fascinating to study responses to the epidemic of layoffs. Market fundamentalists celebrate the orgy of "creative destruction" - doubtless the only phrase from Schumpeter most of them know - as an essential purgative that will make us all better off in the long run. Centrists concede the long-term benefit, but worry about short-term costs of adjustment. On the left, such as it is, the "end of work" thesis has gotten great play; it reads downsizing as a moment in a larger trend, the replacement of workers by machines.
Celebrants can be repellent in their enthusiasms. Here's Louis Rossetto, founder of Wired, who "welcomes" the process. On his vile magazine's HotWired Internet site, Rossetto declared: "Old schlerotic [sic] industries and power centers are being displaced by a vibrant, decentralized economy. Do some people lose their jobs in the process? Yes. (And some shareholders lose in the process, as well - IBM lost $75 billion dollars for its shareholders). Is the process painful? Undoubtedly. But is the end result bad?... [M]ost assuredly not. In fact, America is emerging from this transformation stronger, richer, and better positioned to be a global economic leader...." Rossetto himself was bounced in a downsizing in 1990, hurt like hell for a bit, then started Wired, which has evolved into the leading PR sheet for Cybertopia. We should all be so lucky.
Rossetto and other cheerleaders show great faith in the bountiful jobs of the future. More temperate sorts agree, but add that workers need some help in making the transition. For example, Labor Secretary Robert Reich said in a recent interview that "the most rapidly growing job categories are knowledge-intensive; I've called them 'symbolic analysts.' Why are they growing so quickly? Why are they paying so well? Because technology is generating all sorts of new possibilities.... The problem is that many people don't have the right skills."
Reich, it seems, doesn't read the projections of his own Bureau of Labor Statistics (BLS). Listed in the box nearby are the BLS's projections of fastest-growing occupations between 1994 and 2005; they bear no relation to his fantasies, or those filling the pages of Wired. These 30 job categories alone account for a third of total employment today, and for over half the next decade's projected growth. Of the top 30, those that look like symbolic analysts account for 7% of employment now, and 13% of projected growth. Most look quite mundane. Engineers, computer professionals, and associated technicians together now account for about 3% of total employment and under 7% of projected growth. It's hard to see from this how "America is emerging from this transformation stronger, richer, and better positioned to be a global economic leader" or why "the problem is that many people don't have the right skills."
People do love to harp on skills though. It's the favorite conventional explanation for the rise in income inequality over the last 20 years - accepted as fact by those who apologize for polarization, and seen as the key to mitigating it, for liberals like Reich.
Perhaps not surprisingly, since most social analysis in America is powered by caricature rather than fact, the evidence for the skills argument is spotty at best. While it may be that we'd all be better off if workers were better trained, there's no sign that actual employers are demanding such a workforce now.
One problem with analyzing skill is that it's a difficult concept to define and measure. Economists typically use a mix of education and experience to describe the skill of workers, but these are only inexact proxies. At the big picture level, the rising "education premium" - the earnings advantage enjoyed by those with advanced degrees - is often cited as proof of the rising demand for skilled workers. But comparisons of U.S. regions show that the higher the unemployment rate, the greater the education premium; since average unemployment rates have drifted upwards since the golden age - they averaged 4.6% in the 1950s and 1960s, and 6.8% since 1980 - it may be that the rising education premium is just a sign of a slack labor market.
More direct attempts to measure employers' wants offer no support for the skills thesis. To measure the changes in skills requirements in the U.S., David Howell and Edward Wolff linked changes in employment in 64 industrial and 264 occupational categories from 1960-1985 to their descriptions in the BLS's Dictionary of Occupational Titles. They found that low-skill service industry work grew more quickly than high-skilled - and, perversely, the more rapidly growing service industries "required higher skills but paid lower wages than the low-growth service industries." The picture was brighter in manufacturing, but it's a shrinking field. For nonsupervisory workers as a whole, the most rapid growth "was in the highest skill segment but in the lowest wage segment." Finally, were the skills-income link as tight as myth would have it, changes in the mix of occupations should have reduced the level of earnings inequality. Since inequality has risen, it's likely that most of the polarization we've seen has occurred within occupations, not between them.
That last finding has been confirmed by other studies, which have shown that the increase in "within-group" inequality - earnings inequality among workers of similar age, sex, and schooling - accounts for a much larger share of the polarization of the last 20 years than between-group polarization. Statistical models built by economist Alan Krueger to predict wages on the basis of workers' education, experience, race, sex, and other demographic characteristics can explain less than half the spread; clearly lots of other things, systematic and random, are happening. Other studies using similar models have grown less successful in predicting earnings over time - another way of saying that incomes are polarizing much faster than the polarization of education and experience can justify.
One reason these models explain so little is that the contribution of education to employment success is nowhere near as simple as it might seem. Of course, formal training does impart certain skills; self-taught neurosurgeons are rare, to take an extreme example. But work training at less elite levels has proved disappointing; for example, people with (nonprofessional) vocational training in high school find it easier to get jobs, but there's no evidence they do any better once they're working. And while having a high school diploma is necessary to snag certain kinds of jobs, grade average correlates neither with the probability of getting a job nor one's pay upon landing a position. Some studies even show that high school grads with high standardized test scores earn less than those with lower ones. There's less information available about the relation of college GPAs to success at work, but the results seem similar there too.
Studies of the relations among wages, schooling, and scores on standardized tests - admittedly imperfect measures of skills - show that while people with more education make higher scores on the tests, this advantage pales next to the higher wages earned by the credentialed; nothing in the scores can explain why college grads earn 60% more than those with a high school diploma ($15.71 an hour vs. $9.92 in 1993).
Still, employers and their publicists are often heard complaining about defects in the workers that the U.S. educational system is delivering them. What do those complaints really mean? And just what is responsible for the 60% college premium?
In a recent article in the California Management Review , Peter Cappelli asked "Is the 'Skills Gap' Really About Attitudes?," and answered his own question "yes." Cappelli reminds us that in the 1970s, there was lots of worry about bad worker attitudes - the "blue collar blues," an alienation that expressed itself in strikes, sabotage, and truculence. By the mid-1980s, though, the complaints were all about "skills" - workers just didn't have what it took to cut it in the modern world. Education summits were convened to address the skills problem - though of course little new funding for primary and secondary schooling was on offer.
Employer surveys reveal that bosses care less about their employees' candlepower than they do about "character" - by which they mean self-discipline, enthusiasm, and responsibility. Bosses want underlings who are steadfast, dependable, consistent, punctual, tactful, and who identify with their work and show sympathy for others; those who are labeled creative and independent received low marks. (A survey of high school teachers showed almost identical results.) Workers are rarely dismissed for incompetence, but rather for absenteeism and other irresponsible behavior. An extensive 1991 review of research on personality and job success by Murray Barrick and Michael Mount showed "conscientiousness" the best of five predictors, and "openness to experience," the psychologists' odd name for smarts, the least impressive. Employers want the can-do, self-starters of classified ad boilerplate, not adepts at Boolean algebra.
Another trait that's valued highly, according to the psychomanagerial literature, is knack for "prosocial" behavior - doing more for others, which in this case, ultimately means more for the boss. Since prosocial acts are most likely when workers feel happy and fairly treated, the current downsizing mania, which provokes only anxiety and resentment, is not likely to result in the productivity boom its proponents are hoping for. It has done wonders for the stock market, though - Rossetto's heartbreaking tale of IBM shareholders' losses notwithstanding.
If book learning isn't what employers are after, why do the educated earn more? A clue might be in what sociologists have called the "socialization for work" aspects of schooling, but economists tend to regard such concepts as unscientifically spongy, much to the detriment of economics as a discipline.
U.S. corporations have more managers per line worker, and more layers of management, than do European and Japanese firms. U.S. stockholders are now demanding fewer managers to boost profits and stock prices - one of the major forces behind big-time downsizing. But why did these layers accumulate in the first place? Could it be that U.S. workers are more difficult to manage than their foreign counterparts?
Michael Burawoy has argued that workers play all kinds of games on the job, to evade work and outwit the boss. Workers around the world do this, but because of the scarcity and weakness of our unions, U.S. workers have only this way to resist. We even learn it in school. In Learning Capitalist Culture, Doug Foley reports on his return to his old Texas high school; he watched the students trying to thwart the factory model of schooling by playing games with the teachers, and the teachers in turn acting like low-level bosses, trying to outplay the rebellious students. Drawing on Burawoy, Foley says that students learn "that cleverly manipulating authority gains much more than openly confronting authority," a lesson they carry through their lives. But in both cases, the gamesmanship, by making tolerable the fundamentally odious, ends up preserving the structure of the whole social factory.
This seems an especially American mode of rebellion - atomized, apolitical, and fundamentally conservative under its naughty exterior. But in a time where organized resistance to crappy schools and crappy jobs has largely disappeared, we shouldn't equate that disappearance with contentment.
Bosses don't want game-players; they want people devoted to the company and their work. But employers can't supervise their employees all the time; they can only hope that the workers won't indulge every opportunity to sandbag. Samuel Bowles and Herbert Gintis theorize that employers pay a big premium for educated workers because those with more schooling are less likely to goof off and are more likely to give it their all. For our purposes, it hardly matters whether schools reward those kinds of personalities or produce them.
With downsizing and the worship of flexibility, firms want pliable, enthusiastic workers who've internalized enough self-discipline to allow millions of middle managers to be downsized. Enthusiasts like Rossetto give this a phony democratic spin:
This whole downsizing discussion is just plain bullshit. The New York Times story? The one that started with the tale of woe of a former $130K a year banker who is now pumping gas? I didn't cry, I cheered - yes!, there is justice in the world - that fucking parasite was now doing an honest day's work.This whole story is another example of how totally out to lunch Big Media is, missing the story about a global transformation to focus on the discomfort of a bunch of bankers - and media executives, bureaucrats, and a whole level of middle managers that is being confronted with the reality that workers have brains and can organize themselves better than they can rule over them, and that big bureaucratic organizations are the dinosaurs of the 21st century.
Rossetto's $130K banker is as representative of downward mobility as Reagan's welfare queen was of people on public assistance. It's true that since downscaling has steadily crept up the social ladder since it first hit manufacturing workers 15 years ago it's attracted more political notice, but that doesn't make it something to cheer. Despite fashionable talk of slenderness and flexibility, ownership and control remain intensely concentrated, and it's hardly likely that giant multinationals will be replaced by plucky loft-dwelling partnerships and freelance consultants telecommuting from Montana - especially not 15 years into one of the great merger waves in economic history.
For a view of the 1996 economy, Rossetto need only step out of his San Francisco office and check out the loft downstairs, filled with sewing machines operated by Asian and Latina women, nodes in our wondrously decentered world, doubtless cheaply making products to be sold in retail chains with fancy labels - or, if he's not up to the trip, then merely gaze at his $15,000 a year "interns" and $22,000 a year HTML jockeys who put Wired's products up on the Web.
Self-managing workers of Rossetto's fantasies have no say in what they produce and little say in how they produce it; the point of "team production" is to make workers the architects of their own speedup. The challenge to educators is to produce that kind of worker. According to Cappelli, it's not enough to teach students "responsibility, self-discipline, and adherence to rules"; they must emit graduates with good attitudes - which, as we've learned, means cheerful, self-sacrificing, and prosocial. He makes it clear that talk of teaching "values" in the classroom is in part about the most important value of all, shareholder value. Employers, Cappelli and his sources say, should use fear of "losing face" as a motivational tool, and, through "role modeling," use "conformity pressures [to] produce a positive result." It's not enough that employers control your time; they should control your mind and heart as well.
Downsizing anxiety isn't fundamentally about bounced bankers pumping gas; it's about the broad downscaling of the U.S. middle class, a process moving in step with the total immiseration of the poor. Unfortunately, some people take the downsizing message too literally - people like Jeremy Rifkin, in his The End of Work, a vision of a massively jobless future.
Rifkin has a long history of being party to extravagant predictions. In The North Will Rise Again, his 1978 book written with Randy Barber, we learned that "Capitalism is not likely to exist anywhere in the world a hundred years from now." In 1979's The Emerging Order, written with Ted Howard, we read that the end of economic growth and the "topping out of technology" will inspire a merger of American Protestantism and environmentalism in a "new theological prescription for a nongrowth, steady-state ecological future"; Protestantism will be essential because "only by starting with the belief that human beings are basically evil...is it possible to put the brakes on the runaway consumer mentality." Entropy, a 1980 joint venture with Howard, predicted the end of large-scale farming, a return to the land, and a collapse in service employment that will be offset by a rise in manufacturing jobs, as plants "convert back from energy- and capital-intensive production modes to labor-intensive ones."
But now, Rifkin argues, jobs are about to disappear in droves, an argument he makes mainly through a cascade of anecdotes. Machines are and have been replacing people at every turn. Rifkin's account of the 1944 introduction of the mechanical cotton picker in the south, which replaced black field workers, reads almost like a lament for sharecropping.
People have been worrying about machines replacing human labor since the beginning of capitalism. Yes, machines do replace workers - but employment nonetheless continues to expand, quadrupling in the U.S. over the last 60 years. In most parts of the world, aside from Europe and Africa, employment is growing. Throughout history, capitalism has constantly drawn new people into paid labor, though the demand for jobs always outstrips the system's capacity to provide them.
This time it's different, Rifkin argues, since the service sector, which has absorbed the cast off manufacturing workers as well as millions of new (largely female) entrants, is now automating, promising job shrinkage. That productivity boom is invisible by standard measures. Sure, U.S. manufacturing has seen strong productivity growth, but not the service sector; over the last three years, output per hour worked in manufacturing is up 11%, but in all private business, only 1% - the average pulled down by a dismal services performance. Amazingly, output per unit of capital - a messy concept, theoretically and practically, but good enough for journalism - has been declining for most of the last four decades, and with no upturn in recent years, those of the cyberflourishing.
Yes; mechanization does allow fewer workers to produce more stuff. To lubricate his move from this noncontroversial point to the apocalyptic mode, Rifkin quotes Marx's prediction (from the Grundrisse) of the "last...metamorphosis of labor ...when an automatic system of machinery" replaces the living worker. Rifkin seems not to have learned much from the passage that surrounds that quotation. To Marx, machinery renders workers dependent, makes them into watchmen and regulators rather than direct producers; the social knowledge and coordination behind technological production could make possible a more leisurely and humane way of life, but instead is used for the accumulation of money. But machines don't render human workers obsolete; on the contrary, Marx said, they "presuppose masses of workers."
It's odd to cite Marx to refute Rifkin's millenarianism, but here's another soundbite from the Old Man, this from Theories of Surplus Value. Marx foresaw a day when basic industry would be highly mechanized, and only a third of all workers were directly engaged in production.
The two-thirds of the [unproductive] population consist partly of the owners of profit and rent, partly of unproductive labourers (who also, owing to competition, are badly paid). The latter help the former to consume the revenue and give them in return an equivalent of services - or impose their services on them, like the politicalunproductive labourers. It can be supposed that - with the exception of the horde of flunkeys, the soldiers, sailors, police, lower officials and so on, mistresses, grooms, clowns and jugglers - these unproductive labourers will on the whole have a higher level of culture than the unproductive workers had previously, and in particular that ill-paid artists, musicians, lawyers, physicians, scholars, schoolmasters, inventors, etc., will also have increased in number.
Ill-paid lawyers and physicians hardly exist, and some of the occupational categories sound a bit off; who, in the middle of the 19th century, could imagine a world filled with information clerks and home health aides? But the general outline sounds pretty familiar: basic production employing ever fewer, with ever more in ill-paid service jobs. It's a much less dramatic vision than either decentralized Cybertopias or jobless futures, but that's life as the century turns.
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