Funemployment in 2010 and Beyond

(Wednesday, January 20, 2010, 5:22 p.m.)

Which seems the better etymology?

It may be unwise to complain about the job market in a blog. After all, what would prospective employers think if they Googled my name and ran into this entry expressing my frank dismay at my current situation?

But I would prefer to address whatever souls might be in a similar place. I am trying to put my current predicament in perspective. I have a Masters in Computer Science and a Ph.D. in Psychology and Cognitive Science with a focus on computational neuroscience. My interests are very much in a cutting-edge emerging technology that should be and I believe will be in high demand in the near future. I also have over 5 years of industry software development experience. And yet I am hard-pressed to find the work out there, and my interviews thus far have fallen through. I am like the proverbial lamb lost in the woods, not really sure whether I ought to be striving to find a job that is the interest match I want, or focusing on updating my software skills to try to re-enter the more humdrum software developer market, or whether I should just give up and apply to post-doc positions that will give small but existent income.

I am very fortunate in a couple of respects. First, I have supportive parents I can stay with while I'm searching. The importance of this cannot really be overestimated right now. Second, I have no dependents. What a bad time it would be to have dependents! Job security right now for most people is zero. Who can say they will have an income 6 months down the road under these economic conditions? The real kicker is that, even when I do finally get a job, I could end up back in the same place I am now 2 years later: not knowing how many weeks or months it will take me to find my next source of income. Being without income, I am dependent on my parents, and any hope I might have of dating or moving my personal life forward is forlorn. I am not starving, but I'm stuck until I can find some source of income.

But I suppose I'm not alone right now. According to the U.S. Census Bureau Population Clock, the U.S. population today is 308,523,679 (~308.5M). According to John Williams' Shadow Stats site, the official government rate of unemployment is at 10% right now. Now in my opinion, the official rate is bullshit, for the reasons Williams explains: the official statistic does not count "discouraged workers," people who have given up the job search. Nor does it count people like myself who have graduated and chosen not to collect unemployment insurance. Williams' estimate of true unemployment is a whopping 22%! As pointed out here, during the Great Depression, unemployment as percentage of the labor force maxed out at about 25% (in 1933). However, it should be noted that the U.S. population of the time was only around 93M and the labor force around 52M. If we assume that the labor force in 2010 is, as in 1933, around 56% of the total population (which is probably a huge underestimate because more women would be working now than in those days), then the 2010 labor force is about 173M, and there are officially 17.3 million Americans unemployed. If John Williams' estimate is better, then that figure goes up to about 38 million! Compare this to the 1933 (worst) figure of 12.8 million in the Great Depression (see the first table here), and you can see that, either with the official or unofficial figures, the current number of unemployed Americans dwarfs the Great Depression figure. So I (and you, my fellow brothers and sisters in purgatory) am not alone.

What is worse, I believe (with Martin Ford) that unemployment will grow worse as automation continues to replace the need for human labor in industry, even in the labor of highly trained and educated individuals. I have just finished rereading Ford's The Lights in the Tunnel: Automation, Accelerating Technology and the Economy of the Future, and he makes a compelling case (see here for a synopsis) that automation will eventually cause there to be less jobs available to average would-be workers/consumers. That is because the new jobs that are created by the new technology will require more advanced education and specialized skills, and it will be difficult to retrain those laid off into these positions. What Ford predicts will happen is that the few people who have those skills and the businessmen who own the capital that replaces the human labor will become richer at first from the profit increases made by replacing human labor with less expensive automated systems. However, mass demand for things like cell-phones and cars will collapse when fewer people are receiving income through employment. At that point, even those that benefit initially from the labor-saving may fall victim to the fall in mass demand. In his book, Ford compares the effect of automation to the old slave-plantation labor in the pre Civil-War South. The South had the advantage of being an export economy, but the global economy has no external economy to export to if global demand for consumption drops.

Ford recommends government solutions which run counter to my own political tastes, but given the severity of the scenario he is suggesting, I think it bears hearing him out and starting the discussion he recommends begin of possible solutions to our likely future dilemma. In a nutshell, what Ford recommends is that government tax the revenue of corporations, eliminating payroll taxes that depend on employment of human labor. From this revenue, the government pays out an income that is tied to incentives towards education, community service, the arts or whatever is deemed as productive endeavor in lieu of traditional jobs employment. Either a new bureau or some semi-privatized system similar to the Fed is to be put in charge of taxation and determination of the incentives. Ford sees this not as trying to implement a socialist, Marxist system, but rather trying to set up institutions that allow the market system to continue to function and maintain consumer demand that is needed to drive the incentives towards technological progress. I'm not entirely comfortable with his solution suggestions, but I have to give him credit for putting a specific solution on the table to consider, rather than just complaining about how bad things will be getting. It seems like it would be productive to consider his solution and try to develop more free-market oriented solutions that might be capable of rendering the same results as Ford's plan.

As someone who wishes to work on artificial intelligence technology and advance the progress of automation, I think it is important to consider what solutions might be out there for the kind of problem Ford is predicting. It stands to reason, in my view, that eventually machines will be able to replace human labor on the manufacture of essential goods and the delivery of essential services. In such a world, there needs to be a way of fairly distributing those goods and services that does not require the consumers to be laborers in the old jobs that have been automated away. It will be a pressing political problem, and as a society we need to be contemplating these issues now rather than after things are in a global crisis that dwarfs the present one.

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