ICTU’s employment document is an interesting addition to the debate. However, it is not fully clear where the one billion figure comes from and, in general, it would be worth thinking further about costing. The overall thrust of the document is important though, in particular their correct emphasis on the urgent need to address full unemployment.
8 replies on “ICTU Employment Document”
‘full unemployment’?. Is it really that bad?
Redundancies – I would definetly recommend for the benefit of allowing an employer continue to trade, even for a short spell, and retain staff rather than leave too late to manage out certain predicaments to the detriment of all staff. Please bear in mind that unions have to retain a volume to be effective. €1 Billion is a nice round number though, always beware of roundings. Especially ones with nine zeros.
Could I just allay any damage my barbed prose may have caused Ireland Inc and assure you that the “full unemployment” referred to in the post is at the level of the individual rather than the economy.
The game is up. Our Production + Construction Economy is in the ER on life-support. The FIRE* Economy [aka. Service] sits atop the P+C economy and requires annual injections of Credit just to keep going. Now Credit begets Debt and Debt increases EXPONENTIALLY!. If you do not understand this relationship get a SpreadSheet and model it. Very interesting plot-line.
Anyhow. In order to service an exponentially increasing sum – you need an annual increase in income (wages and salary) to balance out the debt! Now please tell me where the increase in wages and salaries is going to come from! Ah! Yes! The TAXPAYER!!! Jesus folks, get real! The game is up the Taxpayer is not able to carry any further debt repayment loading.
The Global Labour Market has a massive oversupply. We, in this Permagrowth economy are going to experience a significant decline in our Standard of Living – and there is absolutely nothing that will prevent this. You could increase the Money Supply! Yes, good auld Inflation. Actually a Debt Jubilee might just work. Would not prevent the collapse – just slow it down. Prevent poverty and destitution.
Ictu plan is a non-starter and David Begg must know this. So whats the story? Gamesmanship? And – the IBEC plan is just as barmy.
* Finance, Insurance and Real Estate.
A good perspective on the long run scenario is provided by Jeremy Rifkin in his book, The End of Work. Rifkin is summarised here:
“Even with a much-reduced workweek, the United States and every other nation are still going to have to address the problem of finding alternative forms of work for the millions of people who are no longer needed to produce goods and services for an increasingly automated market economy. Up to now, the marketplace and government have been looked to, almost exclusively, for solutions to the growing economic crisis. Today, with the market economy less able to provide permanent jobs and with the government retreating from its traditional role of employer of last resort, the nation’s civil sector may be the best hope for absorbing the millions of displaced workers.”
This was published in 1995 but seems more relevant than ever now, coming after Irrational Exuberance, the Dotcom Bust, the post-2000 Housing Bubble and the Sub-prime Finance Crisis.
“Organized labor has been weakened by 40 years of automation, a decline in union membership, and a growing temp workforce that is difficult to organize. In meetings with union officials, I have found that they are universally reluctant to deal with the notion that mass labor -the very basis of trade unionism – will continue to decline and may even disappear altogether.”
Ronan Lyons mentions – in a recent comment on a post about unemployment – the idea of making at least some of the dole payment in some way contingent on doing some work. (This has got me thinking about trying to make the dole “wash it’s own face” i.e can dole recipents do anything that would generate revenue, as opposed to contributing to the public good?).
The main point though, was that Ronan can think of about 25,000 non-profit organisations on the island who could think of lots of things to do with spare labour.
The existing labour+welfare legislations will have to be amended so that Dole Recipients can work at any employment that they are sufficiently experienced and qualified to do – without additional payment. That is, people on the dole are already paid, and since they are not in any official paid employment – they can work. New paradigm. Same applies to all civil and public service jobs – the lowest and highest rate of pay is the Dole, take-it-or-leave-it. Unions will swoon – but what’s the alternative if the taxpayer CANNOT provide any additional revenue? Monopoly money?
There will be NO additional payments, the taxpayer CANNOT afford them. When will this sink in? Our Permagrowth economy is over. We have reached the Inflection Point of the exponential growth curve and its down from here on. So few get this significant point. You can model it for yourself using a SpreadSheet: Income Series: 2,4,6,8 …. Debt Series: 0.5, 1.0, 2.0, 4.0 …. Compare the plot lines!!! At the point the Income plot line intersects the Debt plot line your s*****d – or something similar.
As I mentioned, we need a new economic Paradigm which is not based on the use of credit and compound interest to power economic activity. Interesting Times!
I don’t think a deep recession is the best time to judge that improvements in labour productivity arising from automation have caused a phase change that makes full employment impossible, meaning that it is necessary to permanently find alternative work for the masses outside the market economy. Labour productivity has been improving rapidly at least since the start of the industrial revolution, and while it has sometimes produced mass unemployment among specific groups (e.g. weaving outworkers) and in specific business systems, innovation in products, services and business systems has always restored at least the potential for full employment in the past. Maybe this time will be different, but I think we should be more worried about proven causes of persistent unemployment, including social exclusion, persistent mispricing of labour and other sources and symptoms of labour market rigidity.
On the subject of getting the unemployed to work for non-profit organisations, we have experience of this with the Community Employment Scheme. My understanding is that while the CES is politically quite popular, evaluations of its labour market impact have generally been fairly negative. Perhaps a discussion around this might be constructive.