7:47 AM Feb 1, 1994


San Francisco Jan (TWN/Martin Khor) -- Rapid technological developments are leading to unprecedented job retrenchments worldwide, and the resulting unemployment crisis will be structural in nature and get increasingly worse in the foreseeable future.

This is the grim scenario portrayed by the renowned American author and social analyst Jeremy Rifkin, whose forthcoming book "The End of Work" will show how computerisation, automation and biotechnology have already begun to eliminate millions of jobs. Within a few decades, predicts Rifkin, hundreds of millions of people working in manufacturing, services and agriculture could be displaced, potentially causing massive social upheavals in both industrial and Third World countries.

"We are fast moving into a world where there will be factories without workers and agricultural production without farms or farmers," said Rifkin. "Much of the global workforce could well be eliminated, replaced by information technology, robots, machines and biotechnology."

Rifkin, was being interviewed whilst attending an international workshop on the Global Economy held in San Francisco. He is the president of the Washington-based Foundation on Economic Trends and author of several best selling books on environment and society, including Entropy and Biosphere Politics.

His current work is an attempt to answer the question why there is serious, persistent and growing unemployment in the industrial countries, although productivity and output have been rising. Rifkin found that this delinking of jobs from economic growth could be explained by the fast expansion of information technology in both the industrial and service sectors. And in the near future, the livelihoods of millions of farmers, particularly in the South, will be threatened by tissue culture and genetic engineering that can produce foods and fibres in the laboratory.

The accumulation of facts and figures marshalled by Rifkin for his book has marshalled for his new book is both convincing and alarming. In industrial countries, human work is being systematically phased out as computers and information technology replace human hands and minds, forcing millions of blue and white collar workers into unemployment lines.

He quotes studies that predict that in the US 90 million jobs out of the total l24 million workforce are vulnerable to replacement by machines. "Companies are re-engineering their technology and restructuring their organisations to be computer friendly, eliminating traditional managers and workers alike," he says. He quotes an estimate by management guru and former Massachusetts Institute of Technology professor Michael Hammer that reengineering can typically result in a 40 percent reduction in jobs in a company.

A recent Wall Street Journal article projects that one and a half to two and a half million American jobs could be lost each year for the foreseeable future. Out of 90 million private sector jobs, 25 million could be eliminated. The manufacturing sector is fast eliminating human labour from the production process. Computer technology is also causing job loss in the service sector: in the past ten years, three million white collar jobs were eliminated in the US.

In agriculture, farm mechanisation had already drastically reduced the farm labour force. Computerised robots are also now being used in farms. And soon, new plant breeding techniques, particularly tissue culture and genetic engineering, will be able to produce substitutes for outdoor farm products in the laboratory. Hundreds of millions of farmers' livelihoods around the world are under threat.

In Rifkin's analysis, the loss of jobs and persistent unemployment in the industrial countries is due mainly to changes in technology. "It is misleading to blame job loss on the shift of production by corporations from the industrial countries to the Third World, as this is only a secondary factor, and minor compared to the elimination of jobs by technology," he says.

The present technological developments amount to a Third Industrial Revolution, driven by information technology and the new biotechnologies.

Rifkin sees a fundamental weakness and contradiction in the new industrial revolution: "The technology is advancing so fast and productivity is rising, but as jobs are being lost, there are not enough people to buy the products. The capacity to produce will expand tremendously, but there is also a growing lack of purchasing power and effective demand. So there is overproduction and recession."

Within this analytical paradigm, Rifkin explains the Uruguay Round process as a "market extension of the Third Industrial Revolution". Due to their expanded production capacity the big corporations urgently require new markets to absorb their output and thus prevent or reduce the pressures of overproduction, he says. The growth in GATT's power and reach through the Round, the companies hoped, would open up new markets and in new sectors to help overcome this threat of overproduction.

But liberalised markets cannot provide a solution since the worldwide loss of jobs will create a lack of effective demand, Rifkin points out.

"The only way out of this growing jobs crisis is to eliminate work and not the workers," says Rifkin and suggests reduction of the working week from the present 40 hours (in the US) to 30 hours, so that more workers will be employed. At the same time, the rate of pay should go up, although perhaps the average volume of pay may not increase.

"In the past, every workers' movement that has been effective has succeeded in fighting for the belief that the workers have the right to enjoy the benefits of productivity increases, through lower working hours and higher wages...Now we are seeing significant productivity increases, but the hours of work have not declined, and wages instead of going up have actually gone down."

He suggests a three-prong approach to deal with the problem.

Firstly, the working week should be reduced to thirty hours and "we should have more people working, with each person working less hours."

Secondly, the benefits to the labour force should improve, with higher rates of pay and other benefits.

These two measures would enable a fair share of benefits of productivity gain accruing to the labour force.

Thirdly, with the increase in free time, people should be encouraged to participate in the social sector or the voluntary sector, being involved for instance in welfare, education, and community work. As an incentive, volunteers could be given tax deductions and unemployed given a "shadow wage" or allowance.

The scheme could be operated by community based citizen groups and facilitated by the government, which could finance it through higher taxes and voluntary contributions.