[This article appeared in the Winter/Spring 1996 issue of The CPSR Newsletter]

Technology and Jobs: Forging a New Social Contract?

by Jim Davis. Midwest Region Director

I do not wish to contribute in any way to selling labor down the river, and I am quite aware that any labor, which is in competition with slave labor, where the slaves are human or mechanical, must accept the conditions of work of slave labor.
- Norbert Wiener

At the end of 1995, an Associated Press poll indicated that the economy and jobs continue to top the list of concerns for many Americans. According to Challenger and Gray, an outplacement firm located in Chicago, some 3 million U.S. workers have been laid off from their jobs since the beginning of 1989, while over the past five years, Fortune 500 companies regularly announced large-scale job-cuts (10,000 or more). At one point, over 3,000 jobs were being cut from corporate America each day. And, as recently as January, 1996, AT&T announced plans for massive layoffs over the next three years, while Apple announced cuts of 1,800 jobs, with the number expected to go higher[1]. These pronouncements have punctuated American's anxiety over jobs, even after three years of supposed economic recovery.

Our national anxiety is rooted in the industrial age social contract: workers sell their abilities to employers in exchange for wages and then trade their wages in the marketplace for goods they themselves, or other workers have produced. Overlaying this basic arrangement, an entire array of social institutions and agreements arose to ensure a steady flow of healthy workers who have the requisite skills. The core of this arrangement was the "job," but with the widespread application of new labor-replacing technologies, the concept of "job" is undergoing a profound transformation. Old labor requirements no longer hold, and old ways of organizing the production of goods and services are no longer relevant.

At the heart of this transformation is computer-based technology manifesting in a variety of forms, from numerically controlled machines to robotics to "expert systems" to infrastructural developments in digital communications and transportation.

The relationship between automation and work, however, is as old as work itself. Perhaps this has been so much the case, that engineers and computer scientists have not previously felt the need to address issues of social responsibility. To the extent that the relationship of computing technology and work has been articulated, it has been done mostly in the following areas: participatory design (where workers design the tools they will be working with), job privacy issues, and health and safety issues (such as the recent rise of repetitive strain injuries). Nevertheless, the meta-issue of work itself has been largely ignored.

It is ironic perhaps that one pioneer of computer science, Norbert Wiener, considered by many to be the father of cybernetics, raised the issue of technology's impact on jobs nearly 50 years ago. In a 1949 letter to Walter Reuther, then head of the powerful United Auto Workers Union, Wiener predicted:

The [computing machine] is extremely flexible and susceptible to mass production, and will undoubtedly lead to the factory without employees; as for example, the automatic automobile assembly line. In the hands of the present industrial set-up the unemployment produced by such plants can only be disastrous.[2]

While Wiener's prediction may not have occurred as abruptly as he described, the general trend of the impact of new technologies on work has proven the accuracy of his foresight. Computer-based technologies have affected jobs in obvious and not so obvious ways. Weiner conjured the image of computer-controlled mechanical counterparts replacing workers, a world where the activity of the worker is recorded in software, and then replayed ad infinitum in the machine in the absence of the worker. This vision has certainly affected production in discrete-part manufacturing like automobile production. Yet, new production processes (which could not have been developed without the aid of computer-based research tools) have also had an important effect. This has been especially true in process industries, ranging from steel production, to pharmaceuticals and petrochemicals where bioengineered bacteria are "employed" in manufacturing a variety of products.

Between 1980 and 1993, two million jobs were lost in the manufacturing sector. And agriculture, one of humankind's oldest occupations, continues to be transformed by new technologies, ranging from computer-controlled tractors to bio-engineered seeds. Cutting-edge construction technologies employ robotics and remote-control systems to automate large building construction; although these technologies increase the accuracy of production processes and conserve materials, they also tend to further reduce the need for workers.

Various kinds of "white-collar" work have also succumbed to the streamlining of networking and digital communi-cations, thus enabling computer-based communication companies to trim layers of office workers. "Mobile computing," where workers are pushed out of the office and into the field or the home, means fewer clerical support staff, fewer custodians, and less need for expensive office buildings, which, of course, impacts the construction trades and utility workers who build and maintain these facilities. Not even workers in high tech sectors like the computer industry and the telecom-munications field have been immune from the overwhelming impact of technology on jobs.

Electronics have enabled computers, digital switches, and digital routers to handle the dockworker's task of on- and off-loading, the truck driver's job of transmission, the night watchman's job of insuring integrity during passage, the clerk's problem of measuring drayage, and the dispatcher's job of monitoring the load's progress through the transportation system. Digital communications and transport allow digitally-rendered products to be delivered directly from the producer to the customer, eliminating the need for intermediaries. Massive cost-savings occur because whole layers of labor in warehousing, transport, and sales are eliminated by automated information manufacture, storage, shipping and handling. Finally, businesses can bypass retailers and distributors and save billions of dollars on trucking and warehousing expenses.

In other cases, highly-skilled or experienced workers can be replaced with lower-skilled or less-experienced workers who can be backed up by expert systems. This has happened, for instance, in the securities industry. (For example: Fidelity Investments replaced a $100,000 a year experienced stockbroker with fresh-out-of-college phone representatives making $30,000 a year.) Work in general is "dumbed-down," as more intelligence is built into the machinery. And, of course, new technologies have facilitated the creation of a global labor market that puts auto workers in Detroit or programmers in Silicon Valley, for example, into the same labor market as workers in Tijuana or Bangalore, India. Such dispersed production could not be economically feasible without the communications and transportation technologies that computers make possible. This globalization has affected not just manufacturing, but also high-tech production companies such as those involved with software development.

* * *

While the dispersion of computer-based technologies throughout the economy has not happened as fast as Wiener may have predicted, it has been happening nevertheless, and in more widespread ways than he imagined. Although waves of automation have affected manufacturing throughout the 1960s, 70s, and 80s, the impact on information-processing sectors (including most office work) has really taken effect on a broad scale in just the past few years. Even though, as Business Week reports, some $1 trillion was spent on computer technologies in the 1980s, it has taken time for companies to reorganize to take advantage of the efficiency and cost-saving uses of the new technologies.[3] The corporate form for the new information order is increasingly "virtual," where companies focus on "core competencies" and contract out support operations to low-bid frms, and where core workers are supplemented by temporary or contract workers. Jobs that remain "in-house" are susceptible to close monitoring, either because the work is done on computers, or workers can be easily monitored by cheap and ubiquitous video cameras.

In this climate of technological revolution, where companies can shift production to cheaper labor markets, replace workers with machinery, or substitute skilled workers with smart equipment, traditional organized labor is at an extreme disadvantage. One dreary example is the recent failed strike by workers at Caterpillar. Caterpillar survived because temporary workers are increasingly skilled, laid off often from other industries, notably aerospace, and secondly, many manufacturing companies are now less dependent on highly skilled workers than they used to be, as much of the human skill required of tool-and-die making has been replaced by computer-controlled machines. According to the New York Times: "Caterpillar's production rolled along. Sales rose during the strike. Profits rose. And the stock rose."[4]

A. Sivanandan, editor of the British journal Race and Class described this new work/production environment in his essay, "The Hokum of New Times":

[T]he more Labour tries to hold Capital in thrall by withholding its labour, the more Capital moves towards its emancipation through yet more information technology, yet more labour-less productive regimes, yet more recourse to the captive labour force in the periphery. The relations of production, that is, have changed with the changes in the level of the productive forces: information (in the sense of data fed to computers, robots, etc.) increasingly replaces labour as a factor of production; Capital no longer needs living labour as before, not in the same numbers, in the same place, at the same time. . .

The exact impact of technology on jobs is hotly debated. One recent Business Week article reported that even though the layoff numbers have been grim, overall employment has been growing. The article asks, "So where are all those laid-off workers working? And how much are they earning? The answer is vastly different for white- vs. blue collar workers." It goes on to point out that factory workers usually end up taking lower paying jobs. One outplacement firm says that only a third of its clients found a higher paying job, half found something at the same or lower pay, and the remainder entered into the netherworld of work called "self-employment." In his 1995 book, The End of Work, Jeremy Rifkin described a future where jobs are disappearing, although plenty of work is needing to be done; for example, caretaking children and elders, tending the infirm, educating youth, or reclaiming the environment. These activities, however, are not inherently profit-producing.

Are jobs disappearing outright as Rifkin argues? Or, are they being restructured into a bifurcated labor market full of anxious "knowledge workers" on one end, while at the other end marginalized temps, contractors, and part-timers work, free from the "fetters" of union contracts, pension plans, unemployment insurance and workers' compensation, and health insurance? Or, is the restructured labor market merely a transitional phase on the way to widescale unemployment? In the most optimistic scenario, are we merely going through a painful reordering of the workforce, and at some point, the lower paid workers will be pulled into the "cognitariat"? Will an accompanying social equilibrium, including existing economic and property relations intact, thus emerge?

That last vision seems hopelessly pollyannish. According to the Bureau of Labor Statistics, the fastest growing occupations are not only those of health care workers and computer programmers, but include more corrections officers and security guards. These latter job categories flag a society splitting apart. In the wake of changes in work and employment, a social disaster has been occurring: U.S. society is polarizing in terms of income distribution, access to education and health care, and other metrics used to quantify society's basic standard-of-living.

Workers still involved in waged work have seen the value of that labor fall steadily as the result of wage and benefit cuts. Workers laid off from high-paying jobs frequently find themselves reentering the workforce at lower wages. Increasingly, more family members are compelled to enter the workforce in order to maintain the household's standard of living, with many of them working longer hours or at one or more jobs. The number of people living in poverty in the United States is at its highest point since 1961.[5]

A growing section of the workforce is forced into unpaid, or barely-paid labor, through the social engineering of workfare and prison labor, while others scrap together a living with their shopping carts in the "hidden economy" of aluminum recycling, dumpster diving, and street vending. Undocumented immigrants are forced to sell their labor for less than minimum wage, receiving in return no benefits, no rights, social hostility, and possible imprisonment. And, finally, extralegal workers ply their trades in the underground drug and sex industries. In these cases the effect of labor-replacing technology is not reflected in official employment statistics, or family income figures.

In the new technological climate, the old social contract of "you work and will be rewarded" is ending, while the new "social contract" (a seeming oxymoron) spells devastating results for many workers. The Bell Curve theorizes a "scientific" basis for the new social policy, while the demise of welfare, rapid growth of prisons (or their digital surrogates in the form of electronic ankle bracelets and other high tech controls), and the increasing application of the death penalty all implement this social policy. In realspace, we see widespread social destruction and new forms of domination developing in parallel with the construction of cyberspace.

Unemployment is not inevitably the result of technology; rather, it is due to the way in which we decide how to develop and deploy these technologies. New technologies establish the boundaries of an environment in which various possibilities might present themselves, but, as Weiner said, "in the hands of the present industrial set-up . . . certain possibilities wither and others, (disastrous) flourish." His keen sense of social responsibility led him to write the following chilling metaphor:

I do not wish to contribute in any way to selling labor down the river, and I am quite aware that any labor, which is in competition with slave labor, where the slaves are human or mechanical, must accept the conditions of work of slave labor.

"Unemployment" as a category exists within a rather narrow range of the overall ways in which a society can organize itself. If, in this transitional period everything is up for discussion, we need to look beyond how jobs are created and carried out, to include considerations about how the talents and skills of people can be put to use in a socially responsible way.

The issues evolving from the impact of technology on jobs and work have always been complex and require an analysis, not only of the roots of problems resulting from technology, but also including the policy choices that might exist including imagining bold new ideas for social organization that might free up the potential of new technologies.

The issue is so fundamental that it would be foolhardy to refuse to take up this challenge of analysis, imagining, and creating. In this issue of The CPSR Newsletter, we begin to respond to this challenge.


Portions of this article are adapted from an essay, "The Digital Advantage," authored by Jim Davis and Michael Stack, which will appear in Cutting Edge: Technology, Information Capitalism and Social Revolution, to be published by Verso. Thanks also to Kate Williams for her help in assembling the articles in this newsletter.


1. Wall Street Journal, Dec. 22, 1995, p. 1; Business Week, May 9, 1994.

2. Norbert Wiener, quoted in Progress Without People: In Defense of Luddism, Charles H. Kerr, 1993, p. 141.

3. "The Technology Payoff," in Business Week, June 14, 1993.

4. New York Times, September 5, 1995.

5. Associated Press, October 7, 1994.