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Old 29th August 2011, 20:38
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Default Review: The Job Market of the Future

Just finished The Job Market of the Future (2001) by James Cooke Brown, which could be of interest not only to those on the far left, but also center-left people and basically anybody who is interested in full employment and how computers could help re-organizing work.

The author was among other things the creator of the tabletop game Careers (first edition 1955), where players set their own mix of points in different categories (money, fame, happiness) as their winning condition, and writer of the SF book The Troika Incident (1970), where a work allocation scheme exists which is more fleshed out in the book I'm reviewing here[1]. His proposal was inspired by the utopian novels of Edward Bellamy that appeared towards the end of the 19th century[2].

He does not refer to himself or his proposal as radical leftist and the sources for the book are all over the place politically. Nevertheless, he refers to his proposal as a continuation of reforms that have helped the working class (like work-time limits or the minimum wage) and, like those other reforms, it would reduce the privileges of employers.

The hiring process is more formalized. All job offerings must be put into a central database. Each employer specifies the requirements in the database entry, testing applicants is done by the job centers and the employer cannot further influence who of those willing and meeting these requirements get hired (guess firing must also be approved, otherwise that would be a loophole, and there seems to be a loophole to formalization with "teamwork" jobs). The employer also loses discretion over whether to employ part-time or full-time workers. The employer can only offer a "job cake" of work hours and the job cakes get divided by the computer in a way that there are jobs for everyone. The public votes on general parameters of the economy, like average work time and min and max hourly remuneration.

The author claims this would tremendously change the confidence of workers: What so far has been an experience of only the highly skilled would become the norm — workers sorting through job offers rather than employers sorting through workers, less discrimination, and the desirability of a job would play a bigger part in its remuneration.

Pieces of the same cake have usually the same size. The division of every single job cake isn't changed whenever some job offers change. The same job cake isn't freqently changed in its division in a big way. The computer aims to change rather a few job cakes than many, and to change the hours in a slice rather by a small percentage than a lot. It follows that changing slice size is done mostly with the big cakes.

(I think it makes sense to not only set the cake division outside of what employers want, but also to group very similar jobs into the same cake regardless of whether they belong to the same employer. Otherwise a firm could escape from the cake cutting mechanism by nominally splitting into several smaller firms.)

The computer proposes, job seekers react to that, the computer readjusts to meet specific criteria; and when there are several ways to meet these criteria, it makes sense that the computer makes the smallest change neccessary for that, because people don't simply react, they form expectations and speculate and speculation can lead to more speculation, and if we don't want things spiralling out of control, we change the proposed only a little if possible, so people get closer to taking the proposed as something given and don't try so much to game the system.

There's an advantage to making pieces of the same job cake usually the same size that isn't mentioned in the book, that it reduces a problem in worker-steered associations — how many votes to give to people who work different lengths. When people are endowed with votes in proportion to the hours they work, the real relative weight of these votes is usually not proportional to the nominal weight[3]. Co-ops apparantly don't play much of a role in the author's vision though.

At a higher frequency than with the cake slicing the pay rate offered is adjusted by the computer, based on how quickly, if at all, the offers are taken; though here employers can set a pay limit where the job offer gets removed. Given that handling monetary stability is part of the scheme and a part of that is the computer fixing the nominal renumeration of the average work hour, it follows that a removal trigger set below that value cannot be a guaranteed right for employers. Similar to the cake slicing, the computer will not spill change across all offers whenever one is changed, but do something a bit more sophisticated. The author mentions giving priority to change remuneration for jobs that are close to each other in location or requirements.

Less desired jobs are compensated for with higher renumeration, sort of. The author nonchalantly throws skill requirements into the desirability category: If you don't have the skill for some job, the computer counts you as having no desire for it. So there's extra pay for workers with rare skills in demand.

Compare that to what Cockshott and Cottrell propose[4]: There's broad public financing of higher education and job training and you even get paid while studying, this reduces supply bottlenecks of skilled workers; and while it makes sense to put the cost of acquiring skills into the product price, the skilled workers should not be paid more, unlike those doing arduous work. (Note that, since those acquiring a skill can themselves teach it, for a skill that is becoming more common estimates based on current learning cost are likely to be too high, and when learning a skill there are almost always some spillover effects that make it easier to acquire other knowledge, and there are also direct benefits for a person getting skilled at just anything, like a reduced risk of dementia. For these 3 reasons I'm against putting the whole skill-learning cost into the price of a specific product or service.) Though the stance of C & C makes sense as an ideal, they admit it might not be easy to get the skilled work out of the skilled worker without higher pay, particularly while not the whole world is socialist and regions where the public doesn't finance higher education that much lure the skilled from regions that do.

I favour public funding, and that, depending on how selfish people turn out to be, getting a deal for a public-funded expensive education might come with a temporary emigration restriction and/or slightly higher pay. The author mentions that many employers might want to deal with scarce workers by lowering requirements and providing more training themselves. When an employer does this while there are other employers that can make use of these skills, there's a free-rider problem. The author doesn't address this, but with his own reqirement-formalization idea these instances can be made transparent and the benefitting employers could be required to pay the employer that runs the training program. Education should be tightly integrated, that is the job computer should be forward-looking and conduct surveys among people about jobs they don't have qualifications for, and work out offers that include getting qualifications.

How to handle profits is the most puzzling part of the proposal.

In addition to their own salary, employers are to be paid a fair profit. What that is, you might ask, particularly if you are among those who see work as value-creating and profits as a transfer (which is also how the author describes it, in the same book). The author answers that how much employers rise their prices over their costs is something the people should decide by vote, and that every employer then would receive the same percentage over internally paid wages and salaries as a profit, another part of inflation prevention.

The author rambles on about how firms pricing stuff in a way that reacts to demand is abhorrent and I can't quite believe his pricing sytem to work; and the author seems to also have doubts, so he throws in some half-assed thoughts about how there might be some exceptional cases for when firms can't get rid of their stuff, and that the state might increase prices of stuff in high demand over the fixed profit-margin and pocket the difference.

For preventing a wage-inflation spiral the author came up with fixing the average hourly wage while still allowing individual differences. Similarly, he could have proposed here to fix how much firms can raise their prices overall without requiring every single firm to have exactly the same profit rate (and then backpaddling on that), by adopting a proposal by Colander and Lerner: Those who want to raise prices above the general allowance would have to buy that right from those who keep below that level[5].

The author leaves it to the discretion of the employers how much of their profit goes into their own consumption and how much into investment. Surely the vast majority has an interest in nudging, if not forcing, that decision in a certain direction.

I agree with the idea of formalizing, digitzing, centralizing job requirements and assignments and payments, and with readjusting a job's length on that centralized level. I think formalized hiring would reduce discrimination a lot. The rest of the book doesn't look thought through, despite being in the works for several decades (turns out the author died in 2000 and his daughter did the final edit) — and I don't mean just details like how employers might be exempted from complete formalization or cake cutting (by specific laws listing exemptions or by paying a hefty fee?), but the mentioned big problems with education and profit, and in his proposal for a different society the author neither attacks property in land[6] nor "intellectual property"[7] or wealth inheritance[8]. I also don't understand why he doesn't propose to integrate other stuff in the central computation, like consumer surveys.

[1]Official website for the book:
James Cooke Brown in the BoardGameGeek database:
Rachel Hutton — Designing His Own ‘Careers’ (ReadyMade Issue 3, summer 2002), article about the author:
[2]Edward Bellamy — Looking Backward (1888), full text available here:
The full text of Bellamy's Equality (1897) is here:
[3]See eg. the Penrose power index.
[4]Paul Cockshott and Allin Cottrell — Towards a New Socialism (1993), chapter 2, full text available here:
[5]Abba Ptachya Lerner and David Charles Colander — MAP: A Market Anti-Inflation Plan (1980), see also Colander's article A Real Theory of Inflation and Incentive Anti-Inflation Plans (1992):
[6]See Henry George — Progress and Poverty (1879), bestselling book advocating land value taxation, full text:
The tabletop game Monopoly is a mutation of The Landlord's Game by Elizabeth Magie, a teaching tool about the tax.
[7]Richard Matthew Stallman — Did You Say “Intellectual Property”? It's a Seductive Mirage, an essay on why copyrights, patents, trademarks should be referred to separately, here:
Stallman — Patent absurdity (The Guardian, June 20, 2005), about differences between copyright and patents, and especially the problem of broad and trivial software patents:
Stallman — Ending the War on Sharing (2009), about "piracy" of music and alternative funding mechanisms:
Lydia Pallas Loren — The Purpose of Copyright (Open Spaces Quarterly, February 7, 2000), article on the history of copyright and its connection with censorship:
For an overview of alternatives to patents, see Dean Baker — Financing Drug Research: What Are the Issues? (2004), PDF here:
[8]I'm afraid this footnote doesn't offer a link to an elegant idea. How much can a high inheritance tax achieve? Rich individuals are usually quite aware of being mortal and transfer privileges to their offspring before they kick the bucket, whether that is by creating cushy pseudo-jobs — the formalization of hiring can curb that somewhat — or by creating monetary hurdles for acquiring certain skills — that's why public funding of all education is important (and allocating scholarship funds should be a very formal process if we don't want to subsidize confident personalities of a certain social background with mediocre grades). The idea to slowly transform private capital via inheritance regulation into a public institution is probably not something that the rich as a class will ever let idly happen.

Picture this: A long and pleasant life ends, the person used to live a life in apartments in cities with low crime rates and with excellent public transport and parks, and that person did not own any of that or any factory, and nobody else does. What is there to inherit, canned beans, and if the progeny is lucky, maybe a fancy hat? Will inheritance tax not be redundant then? Before we get there I don't see how increasing it would be wrong though, and a bit of redundancy is not a bad thing.