CHAPTER XXV.
UNEMPLOYMENT.
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We have already touched in passing on the subject of unemployment. We have seen how it plays a very important part in the mechanism of capitalist production.
Fear of unemployment is one of the main motivations that compel the working man to compete for jobs, and to submit to any wages and conditions rather than to be left out of work. Without the prospect of unemployment this fear tends to disappear, and the workforce becomes too strong and independent for the capitalist comfort.
Capitalism needs a permanent reserve pool of people looking for work prepared to accept lower wages and conditions to get a job; this situation naturally woud keep compliant those who are working and reduce the demands for wages increases. Up to the 1970s full employment meant zero unemployment, but with the beginning of the neo conservative era full employment became five percent unemployment; statistics became a subject of spin.
At the same time that Capitalism needs a pool of unemployed it also needs consumers with money to spend or with reasonably secure employment prospects that permit them to buy on credit. This is one of the main contradictions in capitalist economy.
Employment levels seem to follow general patterns determined by profitability and convenience for capital investment, whether in relation to national local markets or in relation to the world as a whole.
These are the main factors that have determined the establishment of centers of industry and commerce: large and relatively wealthy populations constituting a growing market; a plentiful supply of skilled and unskilled labour, availability of raw materials and sources of energy; ruling elites or governments which favour the establishment of capitalist industry and commerce; closeness to trade routes that link markets and sources of raw materials.
Western Europe was the part of the world where capitalist industry and commerce first started to grow. There was a plentiful supply of labour, because at the same time when industry was beginning to grow, many people were forced out of the feudal lands and they were attracted towards the new industrial centers.
For centuries this was the pattern in the developing industrial nations: growing populations in the cities, a continuous supply of country people to feed the needs of the growing industries.
In the past, when an industry became established, it could not be moved easily to other areas. Industrial centers had an aspect of permanence and stability. But, in the quest for profits, mobility has always been essential; nothing can stand still, nothing can be left to interfere with the freedom of capital. If capitalist industry could not be moved, then the workforce had to be moved to it; when local labour was not suitable, or was unwilling, then immigrant labour or even slaves had to be procured.
As capitalist industry and commerce established themselves and became concentrated wherever the best conveniences and opportunities were available, various employment patterns developed in different regions of each country.
Some areas became industrialised, with increasing opportunity for employment, while other areas remained undeveloped. The latter became a reserve of cheap labour and cheap produce for the former. Generally speaking this was the pattern of industrialisation and employment in most countries.
The same pattern can be observed if we look at the world as a whole some countries where the general environment was favourable became industrialised, and some other countries remained undeveloped and depressed.
Directly or indirectly, unemployment has been an important factor in the history of capitalist development: even for the most industrialised countries, a steady supply of unemployed people or migrants has always been readily available.
During the recent past, as technology has revolutionised production, communication and transport, capital has acquired a great mobility. Therefore, industrial and employment patterns have started to shift.
Nations that recently have acquired independence are trying to build their own industries, and it does not take very long today to build a new industrial complex anywhere in the world.
Industrial plants that were built yesterday may become obsolete overnight. As the technology of production is changing very fast, it is sometimes more profitable for capital to abandon a long established plant that is becoming obsolete, and build an entirely new one somewhere else in a depressed area where labour is cheaper and unspoiled by old union traditions.
In this way a new trend has been set within each country and throughout the world: industries are disappearing from long established industrial areas, and they are reappearing with new technology in the more depressed regions of the world where there is unemployment and capital investment is more profitable.
As we have seen earlier, the transnational corporations have greatly accelerated this process which is leveling employment patterns throughout the world.
This process is very clearly explained in "Global Reach", a book that was mentioned earlier. It is stated there that ".... the United States trading pattern is beginning to resemble that of underdeveloped countries....., having exported some of its industries to the export platforms of Hong Kong and Taiwan ", it is importing now more and more manufactured goods that before were produced at home. To pay for these imports, it has to export more and more of its "agricultural products and timber". Moreover, unemployment is rising and the gap between rich and poor Americans is widening. To compete against imports produced by cheaper labour in modern factories built by the corporations in foreign countries, American Workers are accepting cuts in wages and conditions, and many of these transnational corporations are dominated by very 'patriotic' American capitalists.
This trend is going on throughout the world, and as it is leveling out the high employment patterns, without greatly improving the low ones, unemployment is becoming endemic in the developed nations as it is in those that are underdeveloped.
If we add to this general trend the effects of automation and the gradual saturation of the markets, the picture becomes even grimmer in relation to future employment prospects.
Unemployment in the present saturated situation seems to produce a trend towards more unemployment. First of all, people have less money to spend. Moreover, those who still have a job work harder and become more productive. As the fear of being thrown out of work increases, competition and antagonism among the workforce also increases, racial prejudice is accentuated by insecurity. More work is done by fewer people, and thus the chances for employment diminish even further for those who are out of work.
In the public service sector the situation used to be slightly better until privatisation, outsourcing and bonuses became the trend, civil servants became upstaged by private “consultants”. Employment there used to be more secure, amongst other reasons because whichever government was in power, it could not afford to create too much enmity towards itself within its own instrumentalities. Generally speaking this is not the case anymore.
Another factor which increases unemployment to a certain degree is the trend towards subcontracting to the workforce all work that was previously performed by wage labour. Each tradesman becomes his own task-master, he produces several times more than when he was working on wages. He becomes involved in a race against the other subcontractors, his former workmates, and also against himself. He also begins to disregard safety and working conditions that previously he may have considered essential.
To sum up, unemployment has always been a feature of capitalist economy and an essential part of its mechanism, but its level has varied from time to time and from place to place.
Several times in the past, Capitalism has faced the danger of revolution because of high levels of unemployment and poverty. In the decades following the First World War, it was saved by the intervention of Fascist dictatorships; then by the turmoil and destruction of the Second World War.
After the war, before the concern about ecological degradation began to appear, during a period of reconstruction and great expansion people believed that Capitalism and technology would solve the problems of poverty in the world by providing employment for all; a promise that Capitalism, because of its very nature, can never fulfill.
During the last two centuries, 'the right to work' has become the most important issue and expectation in western societies. But this is only a recent development. Before the advent of Capitalism in the West, this concept did not exist. It was the 'right to life', whether openly proclaimed or not, that was the main natural aspiration of all Human beings in all previous Ages; By no means was it a right that was always granted and respected. During the Middle-Ages, in the Feudal system, this natural primordial aspiration to live was assured to the mass of the people by their chartered rights to the use of the land for their own subsistence. For the feudal serfs and peasants the right to life was intimately connected with the right to work the land and to share its produce.
As the capitalist system of production developed in the West, with its own concept of 'absolute private property', the use of the land was denied to an increasing number of the population. By denying them the ancient 'right to the land', they were also denied the right to live. Therefore, some found work in the growing industrial centers, but for some there was nothing left other than squalid idleness, banditry, transportation to penal colonies or the public workhouse.
As the land became the private property of a minority, to find work somewhere else became the only way to survive for the great majority of the population. The 'work ethic' became the rule, and the concept of the 'right to live' became the concept of the 'right to work'.
Capitalist "rationalists" today are denying the validity of such a right. But in capitalist society the right to work is equivalent to the right to life, and this right is paramount. It is in essence the right to self preservation and self respect of every Human being.
No system in the world can deny this right for very long. If any social system cannot fulfill this basic aspiration, it has no right to exist it must be replaced.
It is evident that Capitalism is failing to provide employment and a meaningful existence for an increasing section of society. The economy has become obsolete and regressive. Capitalist apologists have begun to question the concept of the 'right to work'.
One sign of regression, pertinent to the subject of unemployment, is that, while only two decades ago the young generations were presented with views of progress and opportunity for all, today their education is being curtailed, and from a tender age, while at home they are conditioned to grow into compulsive yuppie consumers by TV advertising, at school they are being prepared to accept as almost inevitable a miserable life of unemployment and poverty or, alternatively, some regimented form of conscripted menial labour.
There is so much competition for young people in schools to eventually get a decent job in a harsh labour market that many lose hope and become despondent. This is just one of the signs of capitalist regression, a topic that will be examined in the following chapter.