Tuesday, February 14, 2006

America is in perpetutal motion

US work culture: in perpetual motion

From The Statesman
ND Batra

Business Week reported recently that the US economy is much stronger than what the doomsayers have been telling us. The reason is simple: the old statistical system used by the Bureau of Economic Analysis is not good enough to capture the economic reality, the reality of the knowledge economy of the digital age.

Not everyone shares Business Week’s optimism. Knowledge economy is certainly adding to the intangible growth of the economy, which shows up as overall growth in GDP, but why is it not adding up to people’s feelings of well-being? On the contrary, many Americans have a feeling of diffused and widespread anxiety about their future. Pensions have been disappearing. Healthcare benefits are being reduced. Not many people feel confident about retiring.

Sometime ago a local newspaper editorialised, “Too many people juggle multiple jobs but still can’t afford the basics of shelter, food and healthcare... The dignity and purpose of work are undermined when a person who gives a full effort cannot afford life’s necessities.” Americans with cell phones, mobile computing, multiple jobs and multiple shifts have begun to mimic what some chain restaurants tout: We are open for 24 hours a day.

It is a society in perpetual motion, waiting for a coffee break, never fully resting, though occasionally dozing on the desk like a sleepless driver on the steering wheel.Mergers and acquisitions, hanging upon us like a chronic sickness, eliminate jobs without reducing the workload, which is shared by workers lucky enough not to be fired. Experts tell us that productivity is rising. No, Americans are working longer and in multiple shifts to fight the fear of being de-skilled and laid off.

Productivity is a measure of a firm’s output in relation to the resources consumed or how much an employee produces per hour. But many employees take work home or work early and late hours, which adds to their productivity without adding to their income for the extra hours they put in. This seems to push their productivity high and also comforts the management, that has been sold on the idea that computer and telecommunications technology are pushing the profits up.

Most jobs are becoming commoditised and can be substituted and shipped abroad. Computer-assisted design and manufacturing systems do help designers visualise new products on their screens, which can be directly sent to factories in China where cheap skilled labour can do the manufacturing. Computer-integrated manufacturing requires limited human input and eliminates highly paid manufacturing jobs, thus raising productivity.

Experts say that it is possible to customise products that have been mass-produced since Henry Ford introduced the assembly line system and Frederick Taylor added scientific management to business vocabulary. Soon we would be able to customise everything: clothes, shoes, golf clubs, or whatever.

Researchers point out the cost-saving potential of computer automation by eliminating intermediary processes, for example, typesetting in printing; or the use of the Internet for document transfer, such as audio-visual scripts or tapes; and eliminating other tasks which do not directly contribute to the end product.

Teleconferencing does save money but it has also ended opportunities for many to combine their work with vacations. Now the ubiquitous cell phone is transforming vacations to working vacations and homes to working homes. Over 11 million Americans never leave home for work. They telecommute, raising the spectre of hidden electronic sweatshops that somehow escape the scrutiny of civic groups and labour unions because homebound sweatshops are invisible. In spite of the noise about rising productivity, some researchers are puzzled at the “Productivity Paradox.” Investment in information technology does not necessarily produce positive financial gains, partly because many firms invest in technology as they don’t want to be left behind in the rat race.

One reason why every firm is rushing to cyberspace to build a Website is due to the fear that someone else might grab the domain name, which should be rightfully its own. This does not necessarily add to their bottom line, so they go on re-engineering and merging and eliminating jobs, creating a spiral of greater workload for those who want to keep their jobs.

As Alvin Toffler and other futurists foresaw, the hierarchical pyramid structure of the organisation with the boss at the top protected from blue and white-collar workers by layers of middle management would be flattened. The middle management layer has begun to disappear. A new organisational model, the “core and ring” model is emerging in the cyber age. The model has a dedicated core of highly paid top level strategists and planners, who get work done either by an army of temporary workers or by outsourcing the work to virtual neighbours, be they in China, Mexico or Thailand.

Most work, including design, production, marketing and distribution, wrote Venketaraman and Henderson in a 1998 article in Sloan Management Review, can be out-sourced. Labour is not eliminated but it is turned into a commodity. It may be the final triumph of market capitalism, but it is a 24 hours-a-day work week, which keeps the USA at the core with an ever increasing ring of temporary workers spread all over the globe.

If US economy is on the rise, as Business Week wants us to believe, why don’t the American people feel good?

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