Wednesday, May 4, 2016

Review: New jobs in a transforming economy – a low carbon future

This forum took place on May 2nd, details here

There were four speakers:
Martin Haese (Adelaide Lord Mayor), Giles Parkinson (journalist, editor at, Heather Smith (energy and climate change specialist and blogger)  and Catherine Way (industry development manager)

Brief summary

Martin Haese spoke first, and focused on South Australia’s leadership in the area of renewables, and Adelaide City Council’s support of the carbon neutral Adelaide project.
Giles Parkinson spoke next, and focused on the technological aspects and the way that renewable electricity is now the cheapest new electricity generation.
Heather Smith spoke next and focused on industry and employment as we transition to a renewable economy.
Finally, Catherine Way spoke about the fact that there are likely to be fewer jobs in a society based on renewables, but that the web and disintermediation could make up for it.


It was interesting that the first two speakers didn’t mention jobs at all. Though the second pair of speakers did, I felt that overall the forum didn't underline the depth of the problem. Based on my reading at her blog, it is clear that Heather Smith understands the issues, and she mentioned it on Monday. Smith also collated community input on her website, which shows a lot of thought about jobs in new industries. Similarly, Catherine Way also articulated the problem of future jobs and clearly sees problems. Despite this, I still think it didn't get the attention it needs.

The problem (or part thereof) as I see it is this: for renewable energy to be economic, a high-tech manufacturing sector is required. Most of the cost reduction in renewables has come not from fundamental improvements to the technology but from efficiency gains. In this context, efficiency means more automated manufacturing with fewer workers, and more streamlined installation with less labour and a preference for lower-skilled (cheaper) labour.

If we extrapolate what is already happening, we will have an ever-larger unemployed or underemployed underclass, and a wealthy minority whose material needs are attended to by machines.

Simply put, automated manufacturing means that we need a lot fewer workers to deliver the goods and services we want and this can’t be disentangled from the renewables revolution.

I think this is underappreciated by most people who are thinking about renewables and labour in the 21st century. The reason I think it is underappreciated is that most of the “thinkers” are middle-class people for whom the kinds of people who make things are largely invisible. They have an attitude based on consumption of goods, and it doesn’t matter where those things are made or whether it’s by humans or robots. This is why we’re so comfortable using terms like “efficiency” to mean staff redundancies as the labour pool grows ever smaller.

A second industrial revolution? No thanks!

The other problem I had with the presentations is that some of them glibly refer to a second industrial revolution – as though that’s a desirable thing to have. We have forgotten how convulsive and devastating the industrial revolution was to the people living through it. While it was great for the emerging middle class, for most people the industrial revolution brought poverty, immiseration, disease and death. If you want a picture of this, read some Charles Dickens. People didn’t want to be forced from their villages to work long days in dark, dangerous and crowded factories for poor pay. To make them do so, the land they lived on was privatised (it had previously been the commons) and they were kicked off their subsistence farms where they had lived for generations leaving them the choice of moving to the city to earn a living or staying in the country to starve. This was, of course, very profitable to the factory owners (who now had a huge pool of desperate, cheap labour), and is known today as the enclosures.

I think the blithe attitude to a “second industrial revolution” speaks to the sense of entitlement that so many people have today – as though we can realise all the benefits of cheap goods manufactured by robotic labour, but none of the costs of unemployment or social instability.

An answer

For centuries, resources have been plentiful and humans’ ability to harvest them limited. Because of this, a strong work ethic has developed, which views hard work and the accumulation of resulting riches as an expression of virtue. This work ethic and “virtuous consumption” can be seen across our society.

Today though, we have the opposite problem: resources are scarce and humanity’s ability to harvest them far exceeds what the planet can sustainably yield. In this environment, there is less work needed (or desired) than what people want to do and work stops being a virtuous contribution to society but instead a competitive scrabble (also known as a zero sum game) for what is available so that people can gain status.

We need to change our attitude to work and recognise that workaholics are really depriving someone else of their time at work. This attitude-shift will need to have implications right across the labour market – from industrial relations (the length of the working week), to welfare (perhaps a regulated minimum income) to taxation (a stronger progressive tax system with higher marginal tax rates for high income earners to acknowledge the costs to society of them monopolising employment)


I probably sound quite critical of the forum. Overall (despite my criticisms) I thought it was excellent and thought-provoking and I support all the speakers in what they said and their endeavours. However, I think it's easy to fall into the trap of techno-utopianism, and I think that Martin Haese, Giles Parkinson and a significant proportion of the audience[1] did so on Monday.

[1] I have no evidence to support the claim that "a significant proportion of the audience" fell "into the trap of techno-utopianism" -- is was a feeling based on the questions that were asked and the conversations I heard afterwards.
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