Thursday, April 12, 2018

The UBI and the Future of Employment

We hear a lot of commentary, generally positive, about the idea of a Universal Basic Income (UBI). The concept is that every adult in society is paid a minimum income by the state. It is not the same as an unemployment benefit because everyone gets it whether they work or not and it is not means tested in any way.

The idea is not new. Thomas Paine conceived of such a concept in the 19th Century and the Beveridge Committee in the United Kingdom, which designed Britain's modern welfare state, considered the idea in 1945. Switzerland rejected the idea in a referendum in 2016 and a number of countries have run pilot schemes, although none has yet fully implemented it.

The idea has support from unexpected quarters such including technology billionaires such as Mark Zuckerberg. I imagine part of their motivation is guilt at the enormous disparities between them and the poorest in society. They also make a practical argument for the UBI, which is that technology advances will destroy all but the most intellectually demanding jobs in the future and that most people will live on a UBI (paid for by taxes on those who earn all the income) and use their time to pursue leisure activities.

The problem with the technologists' view of the future is two-fold. Firstly, history does not bear out their predictions. Every generation since the advent of the Industrial Revolution has worried about the loss of jobs to technology. This was the primary motivation of the violent 18th Century anti-mechanisation protestors known as the Luddites and similar views have been with us ever since.

The reality is that as jobs have been replaced by technology, new jobs have been created and no one has mourned the loss of the old occupations. An example within my lifetime is the complete disappearance of typists and typing pools that were common in most organisations. Most of those typists got other, undoubtedly more interesting, jobs. Unemployment is at historically low levels throughout most of the world so the phenomenon of job-replacement must be universal. If the doomsayers like Zuckerberg are right, when is the mass unemployment finally going to kick in?

The second problem with the view that we will need a UBI in future is that a society structured on such a basis will almost certainly see some very negative social impacts. Work is not just a means to an end. It is for many people their most important social environment, where they meet and interact with more people than they do anywhere else. The act of working also has intrinsic value far beyond the income we earn - it is one of our most important sources of self-fulfilment and self-esteem. The idea that most people will spend most of their time in future on leisure activities flies in the face of human nature and our social needs.

I listened to an interview recently with Harriet Sergeant, the author of Among the Hoods, a book about youth gangs in the United Kingdom. She spoke about why the young men she encountered joined gangs and said they were seeking two things - respect as a member of a cohesive social group and economic independence. The young men in these gangs were most proud of the fact that they could provide for themselves (primarily through drug dealing) and they were contemptuous of the idea of accepting state handouts. Sociological studies of gang membership all over the world say the same thing - self-sufficiency and self-esteem are most important factors, and these are exactly the same attributes we seek in a job.

The unemployed of the future are not going to become artists and musicians any more than the unemployed of today do - they are far more likely to become members of criminal gangs - and my prediction is that the jobs of the future will replace the jobs of today. The UBI is a solution seeking a problem.


Lindsay Mitchell said...

A survey just described on telly says that a majority of those over 65 want to keep working; and a majority of those, because their work gives them satisfaction and enjoyment.

Another surprising supporter of the UBI was Charles Murray. I reckon Gareth Morgan read Murray's book In our hands: a plan to replace the welfare state, before writing The Big Kahuna.

Lindsay Mitchell said...

I misrepresented the data slightly. Looks like 46 percent want to keep working and 31% have to keep working. Though these two groups might not be distinct. Can't find the actual survey.