Tackling Unemployment

This chapter introduces the approach that ideal societies adopt to tackle the problem of unemployment. It is called Social Employment. Social Employment is the mechanism by which society fulfills its desire of full employment. Social employment is the mechanism that keeps citizens out of poverty.

In the section, "Current State of Affairs" we discuss that ... Currently, in our society, we have some methods to mitigate some of the adverse effects of unemployment. However, these do not solve the unemployment problem. In fact, they do nothing to address the real problem, they merely attempt to "patch it up".

In the section, "The Goal is Full Employment" ... If we successfully solve the unemployment problem, then any adverse effects caused by unemployment also vanish. Moreover, since poverty is directly linked to unemployment, that problem also gets solved.

In the section, "The Approach to Achieving Full Employment" ... So, how should we tackle the unemployment problem?

In the final section, we will consider "Additional Justifications for Social Employment". There are many reasons, and each one has significant merit.

Current State of Affairs

We have unemployment because the private enterprises have no work for all humans. That is because they can get at least some work done cheaper using mechanization and automation. This has reduced the need for humans to work.

Progress in mechanization and automation has raised the bar for the knowledge and skills required to create, improve and use mechanization and automation. Increasing levels of mechanization and automation has been making it more and more difficult for people to find employment. In effect, people are not only competing with fellow humans for work, but they are also competing with machines. In intellectual tasks, 70% of people have disadvantages and only about 30% of people have an advantage over machines. In physical tasks, most people have the disadvantage and machines have the advantage. Even qualifying to run this race of employment is getting harder.

We have been providing some money to those who get unemployed for a limited amount of time; these are the "unemployment benefits" as part of "unemployment insurance". We have also been discussing and trying on a small scale the idea of "basic income" to some people.

Both those attempts are giving money for not doing work. Doing so does not solve the unemployment problem, it adds to the unemployment problem because it reduces people's motivations to finding employment. Who would want to work if they are getting money for doing nothing?

We have also tried the "trickle-down economics" by providing cheap money to those who already have it and are already running businesses. We do so in hopes that the benefits "trickle-down" to those who have very little money. Based on the percentage of people who are not employed, clearly the trickle-down economics is ineffective.

We also have the notion of "minimum wage". Minimum wage is not the wage that is sufficient to satisfy all the average needs of humans. It is the wage rate below which we consider the employment to be exploitative. Minimum wage is the minimum dignity of work. We expect anyone who employs humans to respect this minimum dignity. Not just expect, we require that this minimum dignity be respected and hence we set the minimum wage. Nothing more, nothing less, and nothing else is intended with this concept of minimum wage.

We also have a notion of "living wage". This is the wage deemed by some authorities as the minimum required to live. The first problem with such a computation is that people's needs are not exactly as per the opinion of some authority. The second problem with such a computation is that it does not provide for the variability of living needs for different people with different situations and conditions. Of course, people have been trying to make this concept of living wage better by linking it to inflation and also linking it to geographic disparities in the cost of living, but it still does not account for differences in the needs of an individual. The third problem with the idea of a living wage is that it cannot allow for a person to have wants, because it is the living wage. The fourth problem with the living wage is that there are some kinds of for-profit businesses that have so little profit that paying the living wage to employees would leave the owners with no profit at all, and hence no reason to run the small business. Thus, to the extent that some businesses operate at razor-thin profit margins, requiring a living wage reduces the employment opportunities. The final problem with the notion of a living wage is that it does nothing for someone who is unemployed.

We have also seen that without employment and without any other form of help, a person's ability to survive is in jeopardy.

With the introduction of the Utopian Payment Model, we have fully mitigated the adverse impact of lack of money. The Utopian Payment Model helps pay for essential needs when a citizen lacks wealth for any reason, including unemployment, insufficient employment and higher than normal needs. It scales down what a person has to pay based on how little wealth he or she possesses. This ensures that the person is left with some money which he or she can use for his or her wants. The Utopian Payment Model is designed to be the ultimate safety net for individuals who find themselves in a situation of inadequate wealth. The Utopian Payment Model is significantly better as a safety net when compared to unemployment insurance, basic income and living wages.

Ideas like minimum wage, living wage, unemployment benefits, basic income and even the Utopian Payment Model are not the tools to tackle unemployment.

Owners of mechanization and automation derive profit as the benefit. We, as a society, do not want to hinder progress and hence we allow enterprises and businesses to continue on this path of invention, innovation, mechanization and automation.

However, we should not allow some humans to be the casualty of this progress. After all, progress is only valuable if it benefits all humans. If some kind of progress is hurting some humans, then either we will have to put an end to that specific kind of progress, or we will have to mitigate the adverse consequences of that progress.

Curbing freedoms should be the last resort. It should be used only after exploring many other possibilities and failing with them. We have hardly explored the possibilities of remedying the unemployment situation.

The Goal Is Full Employment

We have not yet reached a stage in the development of automation that no one needs to work. Thus, as long as someone needs to work, work remains important. As long as work remains important, paying for work will remain important. As long as paying for work remains important, working to earn the wages remains important. As long as working to earn wages remains important, employment remains important.

Our goal is to establish a system that enables the well-being of all citizens. Employment is critical for a citizen to satisfy his or her needs and wants. Employment makes a citizen independent and self-sufficient. When we desire all citizens to be independent and self-sufficient, then we desire full employment. That is for our society to be a utopia, we need full employment. For that, we need to design and implement an employment system that ensures full employment.

That is, "Full Employment" should be one of our goals.

To truly mitigate the unemployment causing consequences of progress in mechanization and automation, we need to assure employment to anyone who seeks it. Either they are able to obtain employment on their own strengths, or they obtain it with the help of society.

How to assure employment is described in later sections, but, when we assure employment to all citizens, then we would have mitigated the adverse consequences of the progress in mechanization and automation, and yet we can enjoy the benefits of that progress. Sure, the owners of such mechanization and automation will enjoy most benefits, the employees that create and maintain such mechanization and automation will enjoy benefits commensurate with their contributions and everyone else will enjoy the overall benefits without the adverse consequences.

If society does nothing to assure employment for all citizens all the time, then society will ensure that those who do not have employment will be sentenced to poverty. With the presence of the Utopian Payment Model, the pain associated with poverty is removed. But that still leaves most wants out of reach of those who are unemployed.

We give every child the opportunity to get education so that they can work. Should we not give every adult the opportunity to work?

When the well-being of all is the goal, society must do whatever it takes to assure employment to all citizens.

The Approach to Achieving Full Employment

Currently, many people find employment. The participation rate is about 60 to 70%. Most of our current population finds employment in the for-profit industry.

We already have the notion of minimum wages. The employers of these people are willing to pay at least the minimum wage to such employees. Thus, employers can afford to pay the minimum wages and yet derive profit from the work done by these employees.

Due to mechanization and automation, much work is done by machines and this has reduced the need for employees. We have further seen that the consumption limit places a production limit on producers and thereby limiting their need to employ people to do profitable work. Thus, the profit motive of some has led to a situation that some people do not have anything worthwhile and profitable to do at minimum wages. We have unemployment, and that implies that there is scarcity of profitable work at minimum wages.

So, profitable work cannot be the source of employment that leads to full employment.

In our society, there is some need to ask for volunteers to do some work. This is evidence that work needs to be done, but there isn't money to be paid for such work. We will call this work as socially important work.

Currently, only the most important of this socially important work ever gets done. This is because if no one is willing to pay for it, then less people will be inclined to do it and if we ever request volunteers, then we should request it for the most urgent and most pressing of such social work needs.

There is more work in the socially important category that our society needs. All this socially important work is intrinsically "good to do work" but it is not a need of those who have wealth and hence willing to pay for it. It is also not a want of a large part of the population who would be willing to pay for it.

Thus, this work is such that the motive of profit is insufficient for it to get done. Because profit is not a motive, no private enterprise does it.

The only way out of this situation is for the entire society to take responsibility to fund the doing of the socially important work. Because our goal is full employment, the funding should be at least in terms of wages for all those who are engaged in such socially important work.

Moreover, we should not prioritize and limit what socially important work gets done. For if we do that, then we will be back to the unemployment situation. Thus, we should let all socially important work happen.

Letting all socially important work happen is a good thing as it relieves the society, and by proxy its government, from the responsibility of doing that prioritization. Thus, citizens can do the prioritization and choose what specific socially important work they are interested in doing.

Society should pay the citizens who do socially important work a fixed amount in wages, regardless of what socially important work they do. This ensures that there is no discrimination in what kind of socially important work attracts people, and hence there is no implicit prioritization based on the amount of wages.

Society should enable all citizens to do socially important work. Thus, no one should be disqualified from doing it.

Further, society should not decide or influence who should coordinate and manage the socially important work. This should enable even private enterprises to take up socially important work, organize it and manage it.

All this ensures that the entire population of the society can contribute to the socially important work, either by doing it or by organizing it and managing it. With the entire population enabled for involvement, and funding for wages provided by society, plenty of socially important work will draw the interest of the population, organize the work and employ people to do it. Thus, these people who do the work will find society as their employer and thus find employment. This will help them earn their living.

We will call the current form of employment where the employer pays the employee the wages for doing work as "regular employment". The employees who are engaged in regular employment would be called "regular employees".

We will call the new form of employment "social employment" and the people who get paid by the society for doing socially important work as "social employees". Note that social employees are neither employees of the society nor of the government. They are employees of some non-government organization and do work for that organization and their wages are paid by the society.

Thus, in order to tackle unemployment, we are introducing a new form of employment. This new form needs to coexist with the older form of employment. Both these forms of employment need to follow rules that do not put these two forms of employment in conflict with each other. This is accomplished by establishing standards, rules, privileges and responsibilities. It also involves establishing policy parameters that citizens collectively choose and thereby fine tune the working of the policy.

For regular employment, we will need a "Regular Employment Policy" and it is specified in the next chapter. For social employment, we will need a "Social Employment Policy" and it is specified in the chapter after next. Both these policies are descriptive. For most of the stipulations, the justification should be obvious; for some it is specified.

Anyone who cannot obtain regular employment can always obtain social employment. Details are in the chapter on social employment policy. Since anyone can have social employment, it tackles the unemployment problem fully.

The chapter after the two policy chapters will elaborate the benefits of social employment to citizens, private enterprises, not-for-profit organizations and the society and conclude this topic of tackling unemployment.

While the section "The Approach to Achieving Full Employment" contains the reason that directly leads us to social employment, here are additional reasons why social employment is a good thing.

Currently, we have the basic notion that people have to do some work in order to earn money so that they can satisfy their needs and wants. That is, work is important, and hence paying money for doing work is important. Paying someone to do socially important work is consistent with this basic notion. Paying someone for doing socially important work is better than paying someone for not doing any work.

We provide mandatory education to all citizens to prepare them for the eventual need of working. In a sense, children work their entire childhood so that they can work and earn money when they are adults. So, when a child becomes an adult, society should be willing to support the adult's desire to do some socially important work - not just work that has the profit motive.

In the past, we had provided protections to employees in the sense that they cannot be "fired" without a just cause. This view favors those who have employment and does nothing for those who do not have employment. Regardless of the bias towards those who are employed, such protections demonstrate that society values the employment of those who are employed. The key idea here is that "society values employment". Thus, employment for socially important work should be considered on par with for-profit work.

We also protect the benefits that "some people" should derive from their work. Examples of these protections are built into the copyright, patent and trademark laws. All these laws combined are trying to ensure that those who do certain kinds of work get to enjoy the benefits of doing that work. In these cases, society demonstrates that it values work and is willing to protect the interests of those who do certain kinds of work. When society is willing to protect the interests of some kind of work, then socially important work deserves a higher willingness for such protections.

We also give subsidies to some businesses so that they can overcome adversities. Some examples are the subsidies given to farmers, public transit operators, art galleries, museums, etc. That is, society currently even provides money to some businesses when they need it. If society can help businesses in the form of money, then society should have no hesitation in providing the wages for socially important work.

We also give research grants to private enterprises so that they can do some specific kinds of work. As such, we are willing to spend money to support some kinds of employment. Research is important, and so is social work. There is no reason to do one and not do the other.

We have demonstrated that we are interested in protecting the employment and work of some people because not providing those protections means those people will encounter some harm. We need to extend this compassion to all citizens. If, for some citizens, doing social work is the only viable form of employment, then so be it.