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Three gigs at the Senate

February 2nd, 2018

I’ve appeared (or rather, been heard by teleconference) at two Senate inquiries this week, one on the Northern Australia Infrastructure Facility and one on the problems of the TAFE system. In addition, i completed a submission to the inquiry into the Future of Work and Workers, which is now available on the inquiry website.

The Future of Work submission was about the way in which technology and labor market institutions have interacted to generate the “gig” economy of insecure employment, continuously threatened by technological disruption. The key point is that decades of anti-union and anti-worker legislation and state action have created a situation where technological change is likely to harm rather than help workers. A summary is over the fold

Summary

* Job losses and disruptive changes to working life arise from an interaction between technological change and labour market structures. To understand, and more importantly to improve, the future of work and workers it is necessary to understand both of these factors and the way they interact

* Technological change has taken place consistently over the 250 years since the beginning of the Industrial Revolution (commonly dated to the invention of the spinning jenny by James Hargreaves in 1764). There is no evidence that the pace of technological progress has accelerated, but technical change is increasingly associated with information and communications technology (ICT)

* Technological change has been beneficial on the whole, but there have been many occasions where the interaction of technological change and labour market structures has harmed workers

* Changes in the structure of labour markets and in labour market law since the 1970s have predominantly had the effect of weakening unions and reducing protections available to workers

* The adverse effects of these changes are not always apparent immediately, but are felt in periods of disruption, such as those arising from rapid technological change. In such periods, the weaker position of workers means that they receive few of the benefits of productivity growth, but rather face the loss of jobs and of established working conditions.

* The shift of the balance of bargaining power to employers has contributed to poor work life balance. The period from 1850 to 1980 saw steady reductions in standard working hours and more flexibility in the choices available to workers. Since 1980, the decline in full-time working hours has been halted and partially reversed, while employers have gained flexibility at the expense of workers.

* The ‘gig economy’ is not new, and is the predictable outcome of enhanced employer power. Technological disruption simply acts as a catalyst, breaking down existing patterns of work, and facilitating a shift towards arrangements more favorable to employers.

* The potential social benefits associated with technological innovations will only be realised if policies are changed so that a fair share of these benefits goes to workers

* Full realization of the benefits of technological progress would require a situation where paid work is a free choice rather than, as at present, either a necessity or (in situations of high unemployment) an impossibility. The policies required to achieve this goal should include a Jobs Guarantee and some form of Participation Income. In the longer term, these could be extended to an unconditional Guaranteed Minimum Income or Universal Basic Income.


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  1. February 2nd, 2018 at 22:00 | #1

    I would like to remind readers that a Negative Payroll Tax of the Kim Swales* sort addresses the issues behind both a Jobs Guarantee (the issue of availability of meaningful work) and a Participation Income/unconditional Guaranteed Minimum Income/Universal Basic Income (the issue of income sufficiency) – and it has a cleaner transition without requiring funding proper to boot, as it is piggybacked on an adjusted GST/VAT or similar before funds are levied, which makes it short term revenue neutral and long term budget neutral. As I have already gone into this area in some detail on this blog some years ago, I will not repeat that discussion here and now unless readers ask for it (Google is your friend, on this matter).

    * My calling it that is not his terminology, though. The last I heard, Professor Kim Swales was on the economics faculty of the University of Strathclyde.

  2. February 3rd, 2018 at 09:21 | #2

    Proton capitalism in mediaeval Flanders and later England worked IIRC on a piecework gig economy. The cloth merchants farmed out spinning and weaving to independent workers in their homes. They weren’t employees, but were just as dependent. It was steam.power that created factories – big multi-dtorey buildings

  3. February 3rd, 2018 at 09:25 | #3

    (Damn no edit function) … with a central boiler and engine driving multiple belts and shafts. Oh, water power did the same. Perhaps it’s a mistake to identify the employment relationship as the root of class conflict.

  4. paul walter
    February 3rd, 2018 at 09:40 | #4

    Sometimes come here for for a little light relief

    “future of workers” ?

    Smiles

  5. Alistair Watson
    February 4th, 2018 at 08:19 | #5

    John, Your remarks on changes in the labour market prepared for the Senate Inquiry are reported in this morning’s (Melbourne) Sunday Age, accurately it would seem. Elsewhere in the same paper, a lengthy article discusses how the so-called gig economy is exacerbating the flaws of Australia’s contributory superannuation system, which, in effect, was designed for a long-gone situation of predominately full-time male workers. Best Al.

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