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India’s national employment guarantee hampered by supply constraints

It is a holiday today and so my blog will be relatively short. The Mahatma Gandhi National Rural Employment Guarantee Act 2005 (MGNREGA) was proclaimed on September 7, 2005. It aims “to provide for the enhancement of livelihood security of the households in rural areas of the country by providing at least one hundred days of guaranteed wage employment in every financial year to every household whose adult members volunteer to do unskilled manual work …” The program is an example of supply-determined job creation, which renders it less effective than it might otherwise be if it was redesigned to become a demand-determined scheme. The latest data shows that as the relevant labour market starts to slow down in terms of employment creation, the number of workers who are unable to access jobs at all within the MGNREGA are rising and the proportion of workers who cannot access the full 100 days of guaranteed work remains high (as does the hours gap).

As an aside, dealing with any of the Indian statistical agencies (for example, Central Statistics Office, Labour Bureau) is a frustrating, haphazard experience. The most recent data available is often more than a year old and many of the links on the sites give errors.

In addition, you have to put up with a plethora of flashing and spinning gifs next to brightly-coloured headings, signalling ‘New’ or ‘Updated’. Not very visually appealing I have to say.

Further, the portals for major Ministries (such as Labour and Employment) are not reliably available (not available from Australia today, for example).

So trying to build up a picture of what is happening in this economy and labour market is difficult.

The most recent data from the Central Statistics Office (released February 8, 2016) – Advance Estimates of National Income 2015-16 and Quarterly Estimates of Gross Domestic Product for the third quarter (Q3) of 2015-16 – show that real GDP will likely grow by 7.6 per cent over 2015-16 (if the performance up to the third-quarter is maintained.

This is in contradistinction to the 7.2 per cent achieved in 2014-15.

While the FIRE, retail, hospitality, transport, communications and manufacturing sectors are driving above 7 per cent growth, the Agricultural, forestry and fishing and construction sectors are languishing at 1.1 per cent and 3.7 per cent, respectively.

India doesn’t publish regular employment data and what data one can piece together is quite dated.

The most recent data that is helpful is in the form of the 27th Quarterly Report on the Effect of Economic Slowdown on Employment in India, which covers the period July 2015 to October 2015 and was released on March 8, 2016.

The following graph taken from the latest quarterly small-sample survey by the Labour Bureau shows that the annual growth in employment is slowing after a fairly robust recovery from the GFC.

India_QES_2009_2015Q3

In addition, the results show that:

… a maximum average monthly increase of 0.95 percent in employment is observed in the Metal sector. The other contributor to increase in employment are IT/BPO sector by 0.83 percent, Textiles including Apparels by 0.18 percent, Transport by 0.13 percent and Automobiles by 0.08 percent.

The strongest growth for ‘direct’ workers (those not on contract) was in the IT/BPO sector.

None of these jobs are likely to benefit the rural sector workforce much, which is experiencing a slowdown in employment opportunities.

Further, the most recent data released by the Central Statistical Office for its – Index of Industrial Production (IIP) – (at the 2-digit level up to January 2016) shows that industrial production remains flat.

The following graph shows the evolution of the Index of Industrial Production (March 2008 = 100) up to January 2016. The black line is a 12-month moving average (to smooth out the seasonality in the monthly data).

The overall index has declined for the last three months – the annual growth in November 2015 was -3.4 per cent, December 2015 -1.2 per cent and January 2016 – 1.5 per cent.

India_IIP_2005_January_2016

The overall impression one gets is that the Indian economy is slowing down and this is reducing employment growth in areas likely to benefit the poorer citizens in the rural areas. It might also be encouraging a return to rural areas by unemployed workers who are unable to gain work in the urban centres.

So what has been the impact on participation in the NREGA?

NREGA

I have written about the program previously:

1. Large-scale employment guarantee scheme in India improving over time.

2. Employment guarantees should be unconditional and demand-driven.

3. Employment guarantees in vogue – well not really.

4. Employment guarantees in developing countries.

The MGNREGS was introduced to bridge the vast rural-urban income disparities inequality that have emerged as India’s information technology service sector has boomed. Essentially, the growing jobs boom in the urban areas created massive incentives for poor rural workers to move into the cities in search of a living.

There were two negative consequences of this. First, the urban centres could not cope with the increased populations – housing, transport, public services, etc – were in adequate to meet the demands of the rising populations.

Second, the exit of tens of thousands disrupted the continuity of the rural areas.

The answer was to create job opportunities in the rural areas, where they had been extremely scarce to provide a minimum standard of living for those who stayed and were prepared to perform manual work for a certain guaranteed number of hours per year. That was the main motivation for the introduction of the scheme.

The MGNREGS guarantees 100 days of minimum-wage employment on public works to every rural household that asks for it. The adults must be willing to undertake unskilled manual labour at the legal minimum wage. Once an adult applies for work, the scheme must employ them within 15 days or pay unemployment benefits.

Local communities have input into the selection and design of the jobs and local government plans and implements the work activities.

The Indian Government maintains a wonderful NREGA homePage with a wealth of information seemingly available, but be prepared to endure broken links and scheduled maintenance that prevents you accessing key data.

You can also learn about it – HERE.

The latest – Summary Data.

The initial design of the MGNREGS was far from the Job Guarantee ideal. Remember the features of the Job Guarantee are designed to ensure the simultaneous achievement of full employment and price stability and exploit the currency monopoly held by the national government.

The following Table provides a brief comparison of the desirable properties of a buffer stock employment scheme and the MGNREGS.
The MGNREGS is a cut-down version of the Job Guarantee, in the sense, that the latter is unconditional and demand-driven (that is, the government employs at a fixed price up to the last person who seeks work) whereas the MGNREGS is conditional and supply-driven (that is, the government rations the scheme according to some rules – number of jobs, hours of work or some other rationing device).
You can readily appreciate that the underlying MMT which drives the JG conception is missing from the MGNREGS.The scheme does not provide a permanent job offer which means there is no ‘buffer stock’ capacity available in India.

The lack of universality of the programs means that unemployed workers are unable to freely enter and exit the program. As we will see the promise of 100 days work per year remains an illusion in the MGNREGS.

Unlike a true JG policy, the MGNREGS does not operate as a buffer stock of jobs which allows the wage to serve as a price anchor.
A lack of universality is not the only way that the MGNREGS fails to serve the buffer stock role.

In the MGNREGS, sub-national governments, which are revenue-constrained, contribute to the investment outlays of the scheme, which limits its scope to respond to the demand side.

Also, given the wage arrangements (some of the wage can be paid in food) the MGNREGS does not provide a comprehensive nominal price anchor. By paying a minimum wage to all workers, the Job Guarantee creates ‘loose full employment’ – in the sense it places no pressures on the price level in its own right.

It can also be used to discipline the inflation process by redistributing workers to the fixed price sector. There is no such capacity in the MGNREGS.

Finally, MGNREGS provides no training capacity. The ideal Job Guarantee would integrate skills development into the unconditional job offer and thus build dynamic efficiencies into the economy and provide the least-advantaged workers income security but a ladder to move to higher productivity jobs in the future.

A report yesterday in the Times of India (March 27, 2016) – India’s most wanted: Jobs, Jobs & Jobs – provides some insight into what is happening with respect to the MGNREGS.

The data it reports demonstrates why a supply-determined employment guarantee approach is less than effective.

The Job Guarantee in its pure form is a demand-determined employment guarantee approach to macroeconomic stability.

The most recent data from the Ministry of Regional Development, which oversees the MGNREGS shows that there is a rising percentage of workers seeking work in the program but are denied jobs as a result of the supply constraints put on the system.

This is at a time that there is a rising demand for jobs in the program as the general labour market slows and the hours available have shrunk.

The following graphic (taken from the most recent reports) and reproduced in the Times of India article shows the persons (in millions) who desired to work in the MGNREGS.

19 per cent of willing participants were denied access to work in the most recent financial year.

India_NREGA_Shortfall

The Times of India article concludes that:

Till the third week of March this year a staggering 8.4 crore persons had demanded work under MGNREGS. That’s a 15% increase from the 7.3 crore who demanded work last year. This is a symptom of large scale scarcity of jobs because the wage employment scheme provided only 43 days of work on average in a whole year — instead of the 100 days guaranteed under the scheme —and that too manual labour.

Of those who applied, nearly 1.6 crore or 19% were not given work — the highest turn-back ever seen in this scheme. So, the job situation in rural areas doesn’t appear to be very healthy.

Note: a crore is a unit of measurement used in India and equals ten million, so 8.4 crore equals 84 million.

The other way in which the supply-constraints on the program are undermining its capacity is in the proportion of workers who receive 100 days of work.

The publicly-available data shows that the scheme has consistently failed to reach the 100 days per year per household target.

For the financial year 2012-13, the average was 46.2 days, in 2013-14, the average was 45.97 days, 2014-15 40.17 days and 2015-16 46.4 days per household.

Conclusion

Conditional (supply-driven) approaches not only undermine the job creating potential but also reduce the capacity of the scheme to act as a nominal anchor.

The reality is the unconditional Job Guarantee approach is the only guaranteed way that the national government can ensure there are enough jobs available at all times without activating an inflationary spiral. It is a very modest approach given those aims – choosing to work via the automatic stabilisers.

A Job Guarantee buffer stock approach would ensure that there was work available on demand, which clearly requires an infrastructure be developed by government to support the policy. Governments must create an inventory of employment opportunities which can be quickly made operational when required.

FINALLY – Introductory Modern Monetary Theory (MMT) Textbook

I will write a separate blog about this presently, but today we finally published the first version of our MMT textbook – Modern Monetary Theory and Practice: an Introductory Text – today (March 10, 2016).

The long-awaited book is authored by myself, Randy Wray and Martin Watts.

It is available for purchase at:

1. Amazon.com (60 US dollars)

2. Amazon.co.uk (£42.00)

3. Amazon Europe Portal (€58.85)

4. Create Space Portal (60 US dollars)

By way of explanation, this edition contains 15 Chapters and is designed as an introductory textbook for university-level macroeconomics students.

It is based on the principles of Modern Monetary Theory (MMT) and includes the following detailed chapters:

Chapter 1: Introduction
Chapter 2: How to Think and Do Macroeconomics
Chapter 3: A Brief Overview of the Economic History and the Rise of Capitalism
Chapter 4: The System of National Income and Product Accounts
Chapter 5: Sectoral Accounting and the Flow of Funds
Chapter 6: Introduction to Sovereign Currency: The Government and its Money
Chapter 7: The Real Expenditure Model
Chapter 8: Introduction to Aggregate Supply
Chapter 9: Labour Market Concepts and Measurement
Chapter 10: Money and Banking
Chapter 11: Unemployment and Inflation
Chapter 12: Full Employment Policy
Chapter 13: Introduction to Monetary and Fiscal Policy Operations
Chapter 14: Fiscal Policy in Sovereign nations
Chapter 15: Monetary Policy in Sovereign Nations

It is intended as an introductory course in macroeconomics and the narrative is accessible to students of all backgrounds. All mathematical and advanced material appears in separate Appendices.

A Kindle version will be available the week after next.

Note: We are soon to finalise a sister edition, which will cover both the introductory and intermediate years of university-level macroeconomics (first and second years of study).

The sister edition will contain an additional 10 Chapters and include a lot more advanced material as well as the same material presented in this Introductory text.

We expect the expanded version to be available around June or July 2016.

So when considering whether you want to purchase this book you might want to consider how much knowledge you desire. The current book, released today, covers a very detailed introductory macroeconomics course based on MMT.

It will provide a very thorough grounding for anyone who desires a comprehensive introduction to the field of study.

The next expanded edition will introduce advanced topics and more detailed analysis of the topics already presented in the introductory book.

That is enough for today!

(c) Copyright 2016 William Mitchell. All Rights Reserved.

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    This Post Has 15 Comments
    1. Bill, hope you’re enjoying your well deserved public holidays. We can only hope most continue to enjoy them with governments constantly undermining penalty rates and moving society to a 24/7 365 day single wage version with not even stable hours guaranteed. Not sure how they think humans can be treated like robots but I guess the people making these policies are happily employed under good conditions.

      Also it’s great to see Fairfax media finally also talking about MMT: http://www.smh.com.au/business/the-economy/radical-economic-ideas-grab-attention-amid-lowinflation-torpor-20160324-gnqhsr.html I can only hope some of my comments over time have helped some journalists to start to see it as a topic to start talking about. Hopefully the start of much more.

    2. Hi Bill,

      Great post. I need to add India’s Federal Government is now being run by extremist right wingers (more or less Fascist, I am not using “Fascist” just for scoring points, It is regarded as so by so many academics who have studied it ). They have never liked this program. This prime minister even campaigned on eliminating this program. They are undermining this program and it will probably emasculated or outright eliminated in another 2-3 years.

      Not that the earlier center right government was great on this. Even they undermined it in various ways. Look here, what India’s greatest journalist P Sainath said about this..

      https://psainath.org/if-this-is-pro-farmer/

      “The government falsely claims that the Rs 38,500 crore (385 Billion Rupees, about 6 Billion USD) given to NREGA in this budget is the highest ever. Truth: the allocation was roughly Rs 40,000 crore (400 Billion Rupees) in 2006 when it was, in fact, a smaller programme. It kept close to that for a while, before P. Chidambaram worked hard at undermining it. The ‘increase’ shrinks pretty fast if you adjust it for inflation. Also, in a year when even the government speaks of high rural distress, an upward blip in spending is natural. Even in Maharashtra with its wretched NREGA performance, more and more people are seeking work under the programme. In any case, over Rs 6,000 crore (60 Billion Rupees) of this ‘record’ sum will go in meeting pending liabilities.”

    3. hello bill and happy holiday to you

      i have also idea about JG which i would like to hear your opinion about, i posted it in a post keynesian famous blog which advocated income guarantee schemes (to deal with technological unemployment) it will be a little bit long comment and i am sorry for the length (but hey you have really big blogs too sometimes and i still read it all haha).

      my JG idea is about dealing with technological unemployment without basic income schemes.

      also my idea i believe compatible with mmt JG and i think that if its not to diffcult it would be great to mix both of them together (one program through deficits or OMF and the other program through taxation and in this case they will balance each other).

      so i am sorry for this length and this is my idea taken originaly from my comment in the post keynesian blog which advocated basic income guarantee.

      i think the solution is subsidise labour in a somehow similar way to how the central bank/government set interest rate today so instead of stimulating demand by incouraging houses to borrow more and to indebt them to death the central bank/government will subsidize wage and income.

      For example for every dollar that employer pay to employee he will get from the central bank/government some cents in return 20 30 40 cents of subsidy depends how much is needed to get full employment.

      Also in this case employers and innovators will get incencetive to invest in technology which make workers more productive instead of the situation today when they invent technology which will replace workers completely by machines AI big data 3D printer.

      also i wrote a justification for mine scheme against the idea of basic income scheme which been advocated by the blogger.

      well the technology advance in rapid pace this days and as you said artifical intellegence big data 3d printers and automated factories can basically make labour irrelevant.

      at least until there will be any new breakthrough technology which will give advantage to human labour again.

      its may take 2 10 20 years but its can take as well 40-50-100 years until technology like this will be invented.

      so no my purpose is not to stop automation my purpose is to make automation complimentary to labour instead of automation which replace labour.

      so why i support this idea more than basic income guarantee schemes?

      1.not everyone is able to work in jobs which require a huge amount of creativity like R&D and not everyone is able to be a doctor,or to be in a job which require empathy (social worker, psychologists ,tour guide, martial arts, teacher yoga teacher).

      so in this case most of the people will stay unemployed and will live on basic income and as i said before its can take 2 years 10 years 20 years but it also can take 40 60 100 years until human labour will get advantage over capital again (we dont know its uncertain).

      and it will cause a lot of problems for people both emotional and even technological.

      a lot of people gain their self esteem their feel of worthiness and their meaning of life from their work,even when people always complain about work its playing important part in their life not only from material point of view but from social as well (even some amount of inequallity like it was in the golden age of capitalism era 50-s 70-s is way more healthier than fully equal unemployed society).

      2.actually in case of massive automation which will replace labour there can be another problem.

      of course really uncertain world is a problem post keynesians discuss it a lot and indeed the purpose of the state is to make the world more certain give security to people (physical economical and social).

      but too certain world where most of the people cant really fullfil themself and their skills (since they are unemployed) can put on hold innovation and dynamicity of our world.

      which in turn will create static and stagnated society like the soviet union (even though without supply constrain and without human rights violations).

      so the point of my idea is not to prevent automation at all,my point is to make it complimentary to labour so the automation will be healthy automation which will preserve the dynamic features of capitalism because of the value of labour for people and0 society and to prevent stagnation in the long run.

      also in this case as i already said innovators and employers will get stimulus to try and create and adopt technologies which will make humans more productive instead of technology which will replace them completely.

    4. Ajit,

      You are spot on. The current right wing government is trying its best to derail NREGA.

      India has had some of finest post keynesian and Marxist economist from the asian regions, like Meghnad Desai, Sukhomoy Chakravarty, Prabhat Patnaik, Krishna Bharadwaj, Amit Bhadhuri etc., who have fought very hard in favour of the poor and working class of India.

      Cheers,
      Sriram

    5. Daniel M, I think one of the main issues with your idea that a JG prevents is is why should employers be subsidised to hire workers? If they can’t afford the wages then they should either automate or go out of business and let someone else who can run a viable business take over. Subsidising jobs is likely to skew the market towards making inefficient jobs. There’s plenty for humans to do for each other that many others have explained so a JG as explained by Bill and others is simple and serves the purpose as a permanent automatic stabiliser in the economy.

      Automation has always come and we adapt. Why keep people working to light gas street lights when electricity lights are better. Those people can do more productive things for themselves and society. Your ideas sound a bit too communist no offense and likely to cause the problems of inefficiencies seen in those economies in the past.

    6. My (highly incomplete) understanding of Bill’s (somewhat too complete) papers on the job guarantee is that it would be structured around (federal,state,local) government projects. In a better functioning democracy this might be acceptable, but still somewhat slow to react as an automatic stabiliser. In our high non-functioning democracy it would be better than the current mass unemployment buffer, but might easily be undermined by its many enemies, similar to the experience in India.

      Has there been any research into moving administration of the JG right down to the personal level so that individuals can offer JG work to anyone for any work they personally value?

      I would see this as also moving to address the problem of how to monetise social capital forming activities as well making the JG more agile and robust against whiteanting.

      Also I would be interested in the idea of adding a right to issue currency to the UN charter of human rights. It seems that many of the problems faced by disadvantaged communities could be addressed/alleviated by their issuing their own sovereign currency for trade among themselves.

    7. Jason H.

      i will answer on your question when the luddite protested they protested against factories which hired huge amount of people they protest been (formal reason) not because of machinary which change humans (because factories provided way more jobs) but because they thought that because of the mass production of goods there will be lack of demand and oversupply.

      but today its not the case even mainstream economists are worried and why?

      because automation automated agriculture (the percent of workers in developed countries in agriculture is 2 percent) manufacturing is becoming fully automated as well (there is japanese factories which can work for month with no worker controlling it).

      and more than that now even service sector becoming automated (big data AI Interent) they can replace humans in service sector (high skilled and low skilled as well) pretty easily when they will fully developed (AI and big data).

      so my question to you how will people adapt? when machinary and softwate and interent will replace people mind and people strength and cordination?

      there is 2 ways suddenly all people will become super creative innovators (innovate all the time and to be craeative) or people will have to work for starving wage in order to be cheap enough to work in most simple manufacturing jobs or to be engineers for starving wages or something like that.

      or people will sit on their ass and will be a welfare recipents from income gunaratee scheme.

      so actually i think your solution of people will adapt will not work i am sorry jason (agriculture manufacturing and services already more and more automated and they also cheaply have all the skills humans have).

      so you have 2 alternative?

      1.communist heaven of welfare recipents

      2.my solution which will not only keep capitalism alive but also will stimul innovators and employers to produce technology which will make workers more productive instead of fully automate them.

      thats the case the industrial revolution today is not like it was before jason and if you dont agree i have a question for you?

      if AI and big data will able to replace people mind and education? (services)

      if robots and machinary will able to do all the physical work of humans? (manufacturing and agriculture)

      how exactly people will adapt? (every new job people will invent will easily taken over by capital)

    8. Daniel M, I work in IT and I can assure you that there isn’t going to be automation if IT jobs for a long time yet as it takes human ingenuity and creativity to achieve all those idea and make them reality. You can’t even realistically automate testing yet in any reliable fashion just look at the amount of bugs that still get through even from companies like Apple.

      Others have answered your questions in more detail and I’m highly considerate to your views and even an idea of a basic income one day if we do teach this automated utopia but there’s huge amounts of work to do wherever I look and I mean real work like building footpaths, planting native vegetation, caring for the ageing population and many other things that could be trained for easily.

      There’s lots of information on your questions by people much smarter than myself out there.

      Danielm and Brendanm I’d recommend starting with this short clip by Steohanie Kelton explaining how a JG would be administered:

      Also the debate about technological unemployment has been going on for hundreds of years: https://en.m.wikipedia.org/wiki/Technological_unemployment yet we have adapted.
      If and when it comes I think we can deal with it by having a more enlightened and educated society with more time to think

    9. Apologies the video is by Pavlina Tcherneva not Stephanie Kelton. Look up her and others work explaining a JG and hopefully a lot of your questions have been answered by them.

    10. Jason H

      first i want both programs to work side by side and second
      This video of tcherneva dont answered my question and my concerns.

    11. IT is the only real sector that developed now and not everyone is capable to work in IT and dont be surprised of AI like the one who beat the world champion in go will soon start to write and test programs instead of humans.

      Now about taking care of elderly there is already robots in japan that do that.

      Supervision of factories in japan don’t really need already everything fully automated.

      Now about building 3d printers already starting to make buildings from nothing and i am as one who have a degree in structural engineering telling you that after some time all this workers in structural engineering will be useless.

      Now as i said high skilled education will not save you from competition with machines because of highly trained ai and big data as well so i dont see how you would adapt also jason h the time with the luddites been different than today.

      [Bill note: I edited out a link to a site I do not wish to promote]

    12. Daniel M, My main point is humans have been predicting these things for years and it hasn’t come true as we adapt. Our knowledge is increasing at an amazingly exponential rate and most of the jobs for kids born now don’t even exist yet. Look st uber, it required the Internet, cellular internet speeds to improve to be fast enough, smart phones, google maps and then inventors to make an amazing app that allows drivers and passengers to be connected. That could only be possible now and that’s why I’m a huge supporter of as upper fast NBN in Australia to bring fibre optic cable to everyone. With unlimited bandwidth come ideas that we can’t even imagine yet so the future isn’t that simple.

      Personally I think climate change and preventing that should be the main jobs program for the world right now or humanity won’t even really be having this discussion by the time automation potentially becomes the major problem.

      I’d recommend this video for insight on how fast the world is changing for some perspective:http://youtu.be/QpEFjWbXog0
      Even our education systems aren’t going to be able to keep up as its structured. I think we will need constantly updated online learning for most of our lives.

      Look I don’t want to take over bills blog for debates like this but also recommend the video posted of a ted talk about how our human intuition is wrong a lot of the time on another recent post that I think is worth watching.

      Thanks for the discussion.

    13. Jason H
      (note for bill sorry for that i just wanted to provide a point without expanding my comment so pls allow me to use part of the article just to answer jason arguements because the writer explain it better than me thank you bill )
      Ok jason sadly ive been tempted to send you a link for a different site which is wrong because its on the blog of bill
      Thats why i will pick his answers exactly on this arguements you are saying now.

      Arguement:

      There are more jobs, there are more types of jobs now than there were 50 years ago. As Mark Andreessen, the person who invented the web browser said, “Just as most of us today have jobs that weren’t invented 100 years ago, the same will be true 100 years from now.”
      (i believe its the same you are saying)

      Answer:
      This is a very common statement that has been repeated all over the internet, but it is unfortunately completely untrue. If you examine the Bureau of Labor Statistics breakdown of occupations, what you find is that only 20% of today’s occupations did not exist one hundred years ago, and more importantly, 90% of all U.S. employment today is in fact in occupations that did exist 100 years ago. While some new jobs have been created, mostly in the computer/internet realm, they employ very few people. People use anecdotal jobs like “web designer” and “social media marketing coordinator” and say “what farmer in 1915 could have imagined that job?” They don’t use the actual top occupations in the U.S. like retail salesperson, cashier, food prep/servers, office clerks, nurses, customer service, waiters and waitresses, hand laborers, secretaries, janitors, managers, stock clerks and truck drivers because of course the farmer would have not have been the least surprised that those jobs existed. (Note that those few listed jobs are 25% of U.S. employment.)

      The fact is that we have not invented all kinds of new jobs that employ masses of people. For the last 100 years we have shifted people from agriculture and manufacturing into jobs that already existed, but that the machines were not yet capable of doing. And the machines are becoming more and more capable of performing those jobs.

      Arguement:
      Other advances in technology have helped facilitate new forms of work, such as the sharing economy, where people both here, New York, New Orleans can drive, be part of Uber, be part of AirBnB, be part of Lyft.

      Likewise, online marketplaces such as Amazon and eBay have enabled the rise of artisans, makers, the type of people who existed in the pre-industrial age. People who had creative and things, and then, could have connections to customers around the world. If you create a book or a song, now, you have new ways to publish, as Pippa did with her own book. New ways to distribute.

      Answer:

      Unfortunately, these are also not good replacements for a full time job. Marketplaces like Uber, AirBnB, eBay, and Etsy certainly do enable some people to supplement their income. But very few people actually make a living from these marketplaces. It is true that distribution of content like songs and books is certainly far, far easier than it used to be. But because of the vast quantity of content on those networks and winner-take-all dynamics, very few people can also earn a living from content creation and distribution. As for the on demand or on tap economy, this does not create any new jobs, it just makes it slightly more efficient for customers to find existing handymen or housekeepers.

      Isaacson’s final statement is a straw man. No one is making a categorical statement that “new technologies reduce the total number of jobs.” The statement at issue is that the particular technologies under development right now — in AI, robotics, 3D printing, advanced personalized health care, etc. — will have a significant impact on jobs that employ masses of people over the next few decades. There will no doubt be “wondrous jobs” created for our great grandchildren — there is simply no evidence, however, that those jobs will employ masses of people.

      Arguement:
      If you’re going to be looking for a job in the future, be creative. What will robots/computers not do that we can do? They work by algorithm. Almost by definition they are not creative. They don’t think out of the box, they don’t think imaginatively. Our minds are cognitive, so we supply Intelligence Squared debaters. No robot is going to replace this panel but nor will it replace the Pixar people and the animation people and the people doing the creativity. And if you learn to code and connect the arts and the sciences that was Steve Jobs’ great advice.

      Answer:

      Once again, the arguments for what computers can’t do ignores the reality of real people in actual occupations. The highly talented scientists, researchers, and engineers that “invent the future” are a very small fraction of the workforce. In the U.S. there are about 700,000 scientists and three million engineers, or less than 2.5% of workers in total. The vast majority of workers are not involved in the “ingenuity” phase of problem solving, they are involved in the “execution” phase. And that is where AI and robotics are going to become more and more capable.

    14. The Tcherneva video was a nice summary, seems to confirm my impression that the proposed JG from MMTers is to be administered by existing authorities. So question remains as to whether there is any research on a JG with a more crowd sourced administration?

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