On Fri, Jul 23, 2010 at 1:01 PM, Sandwichman <[email protected]> wrote: > "there is no reason to believe that these armies of servants and > nannies won't earn decent wages..." -- Annalee Newitz
Correction: the statement appears to be Reihan Salam's opinion, not Annalee Newitz's. > > Such an oddly magical statement of untruth. There are plenty of > reasons to expect less than decent wages, beginning with current wages > levels for servants and child care workers, continuing on to trends in > wages over the last thirty years and concluding with the projected > elimination of other options resulting in a buyers' market for servant > labor. > > > On Fri, Jul 23, 2010 at 11:06 AM, Keith Hudson > <[email protected]> wrote: >> From Forbes magazine, 23 July >> >> Will Your Children Grow Up To Be Servants And Nannies? >> >> Reihan Salam >> >> >> >> Why the labor market of the future will be even more polarized. >> >> Will large numbers of today's children grow up to become servants and >> nannies in the homes of the digital bourgeoisie? There is good reason to >> believe that the answer is yes. >> >> The most pressing issue of the day remains sky-high unemployment. There is, >> however, almost no consensus about how to think about the the depth of the >> problems facing the U.S. labor market. Many believe that the staggering >> unemployment rate is purely cyclical. Karl Smith, an economist at the UNC >> School of Government, has written a post on "the myth of structural >> unemployment", arguing that "the structure of the American economy hasn't >> changed that much in the last 24 months." >> >> Yet one wonders if the last 24 months are the right place to look. In Wired >> for Innovation, MIT economist Erik Brynjolffson and Adam Saunders of Wharton >> offer an insightful portrait of how the U.S. economy has evolved over the >> last decade. Their analysis strongly suggests that the shift toward a more >> IT-intensive economy will lead to even more polarization of the U.S. labor >> market. Brynjolffson has dubbed the "Great Recession" a "Great >> Restructuring," adding gravitas to arguments advanced by thinkers like Jeff >> Jarvis and Richard Florida who've argued in a similar vein. "As growth >> resumes," Brynjolffson writes, "millions of people will find that their old >> jobs are gone forever." >> >> Smith is undoubtedly right that we can't neglect the cyclical dimension, and >> that journalists and would-be visionaries have a tendency to grasp at >> sweeping rather than narrowly tailored explanations for high unemployment. >> In Smith's view, for example, construction employment will likely recover, >> as the building boom of the 2000s was not out of step with the earlier >> building boom of the 1970s. But consider the following counterfactual. As >> Barry LePatner argued in Broken Buildings, Busted Budgets, the >> trillion-dollar U.S. construction sector is unusually fragmented and >> undercapitalized, and thus ripe for consolidation. Economic as well as >> environmental imperatives could drive consolidation, leading to a >> construction sector that is leaner, more skill-intensive and more >> IT-intensive. This would mean far higher productivity. And it would also >> mean that the labor market position of less-skilled construction workers >> would deteriorate. >> >> There will, of course, always be a place for less-skilled workers, albeit at >> low wages. At a certain point, wages in the informal sector might look like >> a more attractive alternative. Discouraged workers who've stopped looking >> for work in the mainstream economy would, in this scenario, remain on the >> margins. Indeed, the steady deterioration in the labor market position of >> less-skilled men is one key reason why male labor force participation has >> declined so markedly over the last 30 years. The pressing question is >> whether we are likely to see this trend accelerate. >> >> Between 1973 and 1995 U.S. labor productivity grew at an average rate of >> 1.4% a year, a rate that means living standards would take 50 years to >> double. In contrast, the 2.7% growth rate in productivity from 1948 to 1972 >> doubled productivity in 26 years. And that earlier period is remembered as >> an economic Golden Age, when working and middle class Americans saw >> extraordinary progress in their living standards and the U.S. economy was >> without peer. >> >> From 1995 to 2000 the productivity growth rate increased to 2.6% per year, >> almost matching the Golden Age. As Brynjolffson and Saunders observe, this >> productivity boom was traced to the deployment of IT investment across a >> wide range of sectors, particularly retail. The more interesting >> productivity boom, however, occurred between 2001 and 2003, when the >> productivity growth rate hit 3.6% per year. This productivity spike was >> driven less by investments in IT than by investments in organizational >> capital, a catch-all term for productivity-enhancing business practices. >> >> The authors observe a sharp divergence between firms that successfully >> transformed themselves into effective digital organizations and those that >> did not. Very bluntly, digital organizations flourish while others wither >> and die. Brynjolffson and Wharton economist Lorin Hitt identified the >> defining characteristics of digital organizations, and the most striking >> were those centered on valuing the strongest performers within an >> organization: In digital organizations, employees are empowered to make >> decisions and they are subject to performance-based incentives. Recruiting >> and investing in top performers is a high if not the highest priority. >> >> The logical implication is that the transition to digital organizations is a >> recipe for even more inequality. In "Performance Pay and Wage Inequality," >> economists Thomas Lemieux, W. Bentley MacLeod, and Daniel Parent maintain >> that the increasing use of performance pay can account for "nearly all of >> the top-end growth in wage dispersion". Assuming this pattern holds, there >> is no reason to believe that we will see any decrease in wage dispersion. >> Quite the opposite: The most skilled workers will cluster in digital >> organizations, and wages at the top will continue to expand at a healthy >> clip. >> >> This raises the question of what will happen to those trapped in the low end >> of the labor market. Recently, the cultural critic Annalee Newitz offered a >> provocative hypothesis: "We may return to arrangements that look a lot like >> what people had over a century ago," Newitz writes. As more skilled women >> enter the workforce, and as the labor market position of millions of >> less-skilled workers deteriorate, we'll see more servants and nannies in >> middle-class homes. While this future might seem disturbing at first, there >> is no reason to believe that these armies of servants and nannies won't earn >> decent wages. But let's just say that this isn't the future most of us >> envision for our children. >> >> Reihan Salam is a policy advisor at e21 and a fellow at the New America >> Foundation. The co-author of Grand New Party: How Republicans Can Win the >> Working Class and Save the American Dream, he writes a weekly column for >> Forbes. for Forbes. >> >> Keith Hudson, Saltford, England >> >> _______________________________________________ >> Futurework mailing list >> [email protected] >> https://lists.uwaterloo.ca/mailman/listinfo/futurework >> >> > > > > -- > Sandwichman > -- Sandwichman _______________________________________________ Futurework mailing list [email protected] https://lists.uwaterloo.ca/mailman/listinfo/futurework
