Jobs, Guaranteed Annual Income, and Robots

2015-06-25-1435268405-3625858-8506058779_426b197e66_bNew Orleans   The big whoops are scratching their heads on a weaker than expected jobs report recently. Has the economy begun to sputter after recent acceleration or have we reached something close to full employment? Remember full employment doesn’t mean everyone has a job, but means that we’re at something close to the bottom of the barrel in terms of workers available for hire. Such a situation is not necessarily a happy place still for workers, but something that satisfies business because there are still some available workers and economists are out of clues about how to go lower.

Keep in mind that these are any old jobs that pay a wage which is not to be confused with good jobs or even living wage jobs much less what was once called family-supporting jobs. Economists have also recently expressed concern that Americans are becoming less mobile and willing to relocate to search for work. Not much of a surprise really. The Midwest is still hemorrhaging people, but a lot of states, particularly in the West are staying put, because they are not sure there’s anything better out there or a place they can afford to live where there are rumors of more jobs. If you’re stuck working for McDonalds, why move across the country to do so? Oh, and housing prices are going up, partially because of a shortage of what? Yes, labor!

So, how are people going to make it? How about a threshold level of guaranteed annual income? Organizing as part of the welfare rights movement in the late 60’s, this was our key national demand. $5500 or fight! For a family of four anyway. We didn’t come close to winning that number, though President Nixon proposed a floor for all welfare recipients that was categorically a guaranteed annual income program though it was called the Family Assistance Plan or as we shouted Fight the FAP! Anyway, here’s how it would have worked:

For a family of four without any other income, the FAP would provide $1,600 (2013: $10,121). But a family that did have income from employment would get a declining amount of FAP dollars until family income reached $3,920 (2013: $24,798). A family of four that had been earning $12,652 in 2013 dollars would have had its income increased through the FAP to $18,725. Ultimately, the vast majority of benefits would have gone to the “working poor,” a significant departure from then-existing programs that denied welfare benefits to those who were employed.

Meanwhile under the first President Clinton, welfare recipients and the notion of minimum support for families disappeared so that recipients got zapped, not Fapped, and in some cases have been reduced by some states to a maximum eligibility of only one-year and hardly $200 per month. We’ve changed in Clinton’s words “welfare as we know it” from just mean-spirited to just plain vindictive.

The Swiss just hammered a GAI proposal in a referendum by a 77 to 23% margin. A Scandinavian country is involved in a promising pilot, so all is not lost, but these programs are universal, rather than based on need or work-status. Ironically, some of the impetus behind the current interest in GAI has to do with technological displacement now that economists and others are willing to concede that technology does not guarantee added jobs, but actually shrinks job availability. Estimates by some naysayer economists say, hey, no problem, this will take a couple of decades and tech transitions to robots and the like will only eliminate 9% of US-jobs.

Hmmm. Right now there are roughly 150 million jobs so if this were today, that means losing 13.5 million jobs. Kaboom! That’s a lot of jobs to replace, and in 20 years if we have 180 million jobs, then that’s 16.2 million jobs down the drain. It’s not clear to me how conservatives are going to twist their minds and mouths to blame all of these workers for their lost jobs and lower pay at the hands of economic change?

Something is going to break. If Nixon knew it, we have to wonder why it’s not obvious to everyone already. Today might not be the time for winning the guaranteed annual income, but the numbers and the politics seem to say that the day is coming.

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Discovering Precarious Work and “Hotel Mama”

fast-food-strike-AP46472623_620x350Charlotte         Is it just me or is the mainstream starting to discover precarious employment?   Maybe it’s the “fight for $15” push that’s opening eyes?  Maybe it’s a residue of the Occupy 1% theme?  Maybe it’s the yawning gap between the rich and the rest of us?  I’m not sure, but I know two things.  One, that, like spring, tales of the precarious are starting to sprout up everywhere, and, secondly, that it has to be a good thing, no matter how odd some of the pieces come out.  None of this is George Orwell down and out in London and Paris, but most of it is more a long look through a telescope at Mars full of observations with very limited, well gloved participation at most.

The New York Times of course has the occasional story of a fast food worker trying to live and raise a family on barely minimum wage, but that’s hardly new.   Recently though, The New Yorker ran a story by William Finnegan, their esteemed reporter on all things south of the US border, where he followed an informal mineworker – one of an estimated 400,000 — in the gold fields of Peru at 17,000 feet who tried to make a hardscrabble living as his fuse burned to an early death.  Elsewhere in the magazine for the life of me it almost seemed that the reader was being encouraged towards at least a glimmer of empathy for Somalian pirates because of the dire economics and precarious prospects for making a living in that failed state.  Interestingly, the business end of piracy seems to be small time, marginal workers hardly a half-step above precarious making “investments” in the success of the ransom demands.  Don’t misunderstand me, I’m not recommending this for marginally employed workers, but the New Yorker’s door opening for their readers into the other worlds of work outside Manhattan is truly fascinating!

The Economist recently expressed concern for the increasingly precarious situation for Japan’s working poor where even with almost full employment, defined at 4% or less, a record-level 16% of the population is now living on less than half the national median income.  Bestsellers are being written in this orderly society on how to live on less than $16700 per year.  American low-wage workers would love to read some books with valuable advice there!   The bottom line is irregular employment.  The Economist noted that “the number of irregular workers – often earning less than half the pay of their full-time counterparts with permanent employment contracts – has jumped to over 1.5 million.  Casual and part-time employees number nearly 20 million, almost 40% of the Japanese workforce.”

Many reports are now wondering, “How are people living like this?”

In Japan, many, especially younger workers, are living at home with parents as their primary housing and welfare agency.  That’s not unusual it seems.   Precarious employment is forcing huge numbers of younger workers around the world into what is being called “Hotel Mama” in Eastern Europe.  In the US 15% of adults 25 to 34 live with their parents.  In Slovakia 74% between 18 and 34 and 57% between 25 and 34, in Bulgaria 51%, Romania 46%, Serbia 54%, and Croatia 59%.

As more and more observers discover the ubiquitous nature of informal employment as if this is a new exploration into a previously unknown world, it’s a good thing, though I have to wonder how they avoided it so long.  Unfortunately, the observations decoupled from participation, still seem woefully short on solutions or even recommendations, even as the recognition of the growing crisis increases.

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