Recommended by 9 out of 10 smart people
21 November 2017 21:16 (South Africa)
Opinionista Jesse Harber

‘Job creation’ is wishful thinking, not policy

  • Jesse Harber
    jessebio.jpg
    Jesse Harber

    Jesse Harber is a political economist, which is a bit like an economist might be if they always had to explain what it is that they do. He recently returned to South Africa after six years in England, Holland and Spain, where he studied public policy and tapas.

There has been talk of a ‘post-employment economy’, and it’s not a bad term for what’s happened since the banks blew up the global economy. The credit crunch came and went, but the crisis continues.

Sarah Kendzior has been writing in Al Jazeera English about the "post-employment economy", which is what she's declared the USA to be. I don't know enough about the US to comment, but from what I've seen in Western Europe, the term's a good one for what has happened since the banks blew up the global economy. The "credit crunch" came and went - the crisis continues. The "recession" comes, goes, comes again; living standards across Europe remain suppressed, and my generation is suffering more than most. Young people simply can't get jobs, regardless of their education, their qualifications, or their "human capital" (whatever that is). This isn't a happening, an event in European capitalism: this is the way things are and they way they are likely to remain, at the very least for a time. Europe is entering a post-employment economy.

But the idea's got legs, too. And there's nowhere it describes better than South Africa. Here we knew that our employment problems were not the result of the global financial crisis. They aren't the result of recession, and it's not about credit or liquidity. The problem is that starting sometime in the late 1960s and increasingly thereafter, businesses decided that workers weren't worth the bother. There were greater returns to be had from capital-intensive production, without having to deal with those pesky workers. And labour was in no position to resist: decades of violent repression of organised labour, combined with the sort of precarious workforce that Walmart would break down doors to get its hands on, meant that by the time a strong labour movement emerged, the damage was done. This is how South Africa operates; this is the state of things. We are a post-employment economy.

Bear with me - this is important. It is important because it belies the discourses of "growth" and "job creation". Sure, the economy grows, but economic power is self-replicating: growth accrues to those who already have the lion's share. Besides for which, the problems with GDP as a measure of anything at all are extensive. And jobs are created, a few thousand more this year, a few thousand fewer this year, but unless the government wants to start disincentivising capital-intensive growth (and can you imagine it?), the number of jobs created is going to remain a drop in the ocean. In the last 50 years, South Africa has become capital-intensive enough not to need labour in any quantity, while deliberately stunting the development of its workforce, keeping it uneducated, precarious and (until relatively recently) unorganised.

What implications does this have? First, we have to stop kicking the demands of workers down the road. Labour can no longer be told that it must defer what it needs today in the name of job-creating growth. The job-creating growth, like the cake, is a lie.

Second, we have to stop trying to browbeat the unemployed into work. If society can offer them no jobs, then it is perverse and cruel to "incentivise" work using social and labour policy.

Third, we have to acknowledge that despite the protections our laws provide to workers, businesses can still wield the immense coercive power of the prospect of unemployment. This tilts the balance of power radically against the working poor.

Fourth, we have to rethink wage levels: anyone who gripes about striking workers should consider that the average working-class South African has a dozen or more people directly or indirectly dependent on them for survival. Unless we find an alternative way of helping people to survive, demand for wage increases will be very nearly infinite - not out of greed, but out of need. This is one way in which the post-employment economy is bad for businesses too.

Finally, and in my mind most importantly, we need to change the link between employment and money. Once we accept that the mass-employment ship has sailed, then we have a moral duty to provide for the poor and the unemployed in a way that isn't connected to jobs.

One policy approach that would do the job is the Basic Income Grant, which received a lot of attention in government and civil society about ten years ago but never saw the light of day, mostly because of concerns that it would "disincentivise" work. This, as we have seen, is a perverse argument: the majority of working-age South Africans would walk over broken glass for a job, and many in a sense do, and being nudged slightly further from starvation wouldn't change that. A universal unconditional grant would help desperate people survive, increase demand for businesses, stimulate local economies, and most importantly help desperate people survive. It would be cheap to administer, relatively resistant to fraud, and would not disincentivise work: show me the person who claims to be satisfied with R200 in South Africa and I will show you a liar (or someone with a secret trust fund).

We have built an economy to which an enormous number of South Africans are surplus: we have a moral duty to help them survive until we can change that. DM

  • Jesse Harber
    jessebio.jpg
    Jesse Harber

    Jesse Harber is a political economist, which is a bit like an economist might be if they always had to explain what it is that they do. He recently returned to South Africa after six years in England, Holland and Spain, where he studied public policy and tapas.

Get overnight news and latest Daily Maverick articles






Do Not Miss