(8) There are multiple versions of this reply, each corresponding to - PDF document

LSE, September 28 th 2017 The Future of Unemployment Tom Parr, University of Essex Comments welcome at tparr@essex.ac.uk (1) Unemployment blights the lives of its victims in many ways, often very severely. These consequences are distributed widely (though not evenly) throughout the population. Moreover, arguably, because of technical change, this situation is worsening. (2) Two options emerge: (A) Adopt measures that minimize the rate of unemployment , or perhaps even eliminate unemployment altogether. (B) Protect against the threats posed by unemployment by making the consequences of unemployment less severe . (3) For the most part, there is widespread agreement amongst politicians and political parties that governments should prioritise policies of the first kind over those of the second. That is, there is some consensus around the following: The Priority Thesis : Governments should prioritise policies that minimize the rate of unemployment over those that make the consequences of unemployment less severe. (4) My primary aim is to cast doubt on the priority thesis and, in doing so, to challenge the cross-party consensus that surrounds it. (5) One familiar justification for the priority thesis appeals to the goods of work argument : (P1): There are certain goods of work – goods that it is easier or less costly for those who are employed to realize than it is for those who are unemployed to realize. (P2): Because of (P1), policies that make the consequences of unemployment less severe will always be in one way sub-optimal in comparison with policies that minimize the rate of unemployment. (C): We should endorse the priority thesis. (6) However, proponents of this argument face the following dilemma: Either, (P1) is a claim about how things work under present institutions , in which case it is at best, unjustifiably conservative, and, at worst, arbitrary; Or, (P1) is claim about how things work under suitably reformed institutions , in which case why not also consider institutional arrangements in which the goods of work are as readily available to those who are not employed? Again, failing to do this at best, unjustifiably conservative, and, at worst, arbitrary. (7) In reply, some proponents of the goods of work argument might maintain that some goods of work can never be as readily available to those who are unemployed, even under suitably reformed institutions. 1

LSE, September 28 th 2017 Tom Parr, University of Essex (8) There are multiple versions of this reply, each corresponding to a different good of work. I consider four, relating to: (i) income and wealth; (ii) self-realization; (iii) social contribution; and (iv) the joint pursuit of socially shared goals. (9) Income and Wealth : Work enables citizens to earn an income and to build wealth. However, it is possible for governments to reduce this incentive by providing much more generous financial support to those who are unemployed. One familiar option is to introduce a generous universal basic income . (10) Self-Realization : Work enables self-realization, where this involves the development and exercise of certain valuable capacities. Three reasons support the claim that self- realization can never be as readily available to those who are unemployed, even under suitably reformed institutions: (i) Given certain assumptions about human psychology, we are less likely to continue to make the effort necessary for attaining self-realization without the kind of compulsion that work provides. (ii) Work is a time-intensive activity that leaves us with little discretionary time. (iii) Work is also often both physically intensive and mentally unengaging. However, these three points support the goods of argument in so far as they show how work is a privileged context in which to achieve self-realization, but not that this must necessarily be the case. In reply, note that: (i) First, even if a degree of compulsion were necessary for self-realization, it is clear that this compulsion can easily arise in contexts aside from employment; and second, we should be sceptical of the claim that individuals generally lack the psychological capacity to achieve self-realization without any compulsion. (ii) and (iii) Even if the nature of employment is such that employees have little time and energy to achieve self-realisation outside of work, presumably this is not true for those who are unemployed, and so who do not face the same constraints. (11) Social Contribution : Work enables citizens to make valuable social contributions, which is one of our most fundamental and important needs. However, this reply rests on an overly narrow idea of what it means to make a valuable social contribution. It ignores the fact that many of our most valuable social contributions occur outside the workplace, in our roles as parents, friends, members of associations and club, and volunteers. (12) However, a complication arises from the fact that social contributions that occur outside of the labour market are seldom recognised as such by other members of the community. This is problematic since, in addition to having interests in making valuable social contributions, citizens have corresponding interests in having those contributions appropriately recognised by others. How can we guarantee such recognition? We must consult the empirical data so as to identify the social and political conditions that are necessary for it to be sufficiently likely that the full range of citizens’ social contributions wi ll be appropriately recognised. 2

LSE, September 28 th 2017 Tom Parr, University of Essex (13) The Joint Pursuit of Socially Shared Goals : Work enables citizens jointly to pursue socially shared goals. The problem with this version of the goods of work argument is that it fetishizes citizens’ joint pursuit of socially shared economic goals, and it neglects the importance of the joint pursuit of socially shared social and political goals. (14) Moving on: The upshot of this is that increasing numbers of citizens will withdraw from the labour force completely, content with long periods of unemployment. In addition to this, we are likely also to see average working hours decrease. These facts give rise to two further defences of the priority thesis: The Economic Efficiency Justification : We should endorse the priority thesis on the grounds that this is the only way to preserve and increase economic efficiency. The Wages Justification : We should endorse the priority thesis on the grounds that this is the only way to preserve and increase wages, especially for the poorest. (15) The economic efficiency justification gets its force from the idea that decreasing labour force participation leads to decreasing economic efficiency, which hurts all of us, including the poorest. However, this argument is vulnerable to two replies. First, even if labour force participation decreases, this will be partly offset by increases in other economically valuable activities, such as parenting and care work. Second, once a society has achieved a sufficient level of material wealth, it is not obvious that further economic growth is always desirable. Instead, we might be satisfied with living in a stead state economy. (16) The wages justification appeals to the alleged fact that, as unemployment increases, wages decrease. This is for familiar reasons relating to supply and demand. The problem with this argument, though, is that we have independent mechanisms for maintaining wages. We can do this directly, through minimum wage legislation, or indirectly, through a universal basic income. (17) Let’s now turn to the final consideration: The Realist’s Objection : Tom Parr’s rejection of the priority thesis is dangerous. Since the social changes that he recommends are unlikely to occur, failing to prioritise measures that minimize the rate of unemployment is likely to lead to further injustice (e.g. increased poverty, stigmatisation, etc.). In reply: True, we should be cautious in criticizing the priority thesis in the way that I have suggested. But, we must also avoid apologism. Just as it would have been wrong for the government to respond to the shaming of single parents by encouraging them to find new partners, so too it can be wrong for the government to respond to the shaming of those who are unemployed by encouraging them to find work. Policies of this kind can re-entrench highly regressive social norms, and in turn make it more difficult to overcome the injustice of unemployment. (18) My primary aim has been to reject the priority thesis. However, my arguments also have more wide-ranging implications. For example, they shed light on an ongoing debate in labour market economics regarding the comparative merits of job guarantee schemes versus universal basic income , as well as human rights legislation regarding the human right to work . 3