Ch. 16 The Economy and Work

Overview Modern economy originates with the information revolution and post-industrial economy - a productive system based on service work and information technology - began in 1950s Character of work changed: From tangible products to ideas From mechanical skills to literacy skills From factories to almost anywhere

What is the Economy? The social institution that organizes the production, distribution, and consumption of goods and services Goods are commodities ranging from necessities to luxury items Services are activities that benefit others

Sectors of the Economy Primary: part of the economy that draws raw materials from the natural environment Secondary: part of the economy that transforms raw materials into manufactured goods Tertiary: part of the economy that involve services rather than goods “Social reproduction sector”: unpaid labour

Economic activity that crosses national borders The Global Economy Economic activity that crosses national borders Consequences: Global division of labour Products pass through several nations National governments have less control Small number of businesses control a vast share of the market Concerns about the rights and opportunities of workers are raised

Other consequences The world's countries are becoming specialized. Governments can no longer fully control the economic activity that takes place within their borders. A small number of businesses control a vast share of the world's economic activities.

Economic Systems Capitalism: Private ownership of property Pursuit of personal profit Competition and consumer choice Welfare capitalism: a mostly market-based economy with extensive social welfare programs State Capitalism: An economic and political system in which companies are privately owned but co-operate closely with the government

Economic Systems (cont.) Socialism Collective ownership of property Pursuit of collective goals Government control of economy Communism: a hypothetical economic and political system in which members are socially equal

Capitalism vs. Socialism Economic productivity: capitalism out produces socialism by 2.7 : 1 Economic equality: socialist economies create less income disparity but offer a lower overall standard of living. Personal freedom: capitalism has freedom to act and socialism has freedom from want.

New Technology and the Workplace How computers change the workplace: “Deskilling” of labour: Machines make some some workers and managers obsolete Making work more abstract: Understanding rather than doing is key Limiting workspace interaction Enhance employer’s control of workers Allow relocation of work: call centres

Automation (CBC News, Mar. 1, 2017)

Labour Force Participation in the Canadian Post-Industrial Economy In 2008, 18.2 million people in the labour force but by Feb. 2009, down to 16.9% 73% of men and 63% of women aged 15+ are in the labour force Approximately 4% are in agricultural work Approximately 75% of the labour force is in the service sector, but much service work pays much less than former factory jobs

Dual Labour Market Primary labour market: occupations that provide extensive benefits to workers, e.g., white collar professions and upper management Secondary labour market: jobs that provide minimal benefits to workers, e.g., low-skill service and blue-collar work “Reserve army of labour”: those last hired in expansion and first fired with contraction

Types of Employment Professions: require extensive education and training – “white collar work” Paraprofessionals: have skills but lack theoretical knowledge Unionized work: 1/3 of labour force Some is “blue collar” work but highest level is in public administration (i.e. teachers)

Self- and Underemployment Self-employment: earning a living without working for a large organization. Includes professionals, farmers, trades people, and home businesses Approximately 15% of labour force Underemployment uses less than one’s full talents or abilities 50% of university grads are in jobs that do not require these credentials. But, level of education is a predictor of employment

Underground Economy Economic activity involving income or the exchange of goods and services that is not reported to the government as required by law, e.g., baby-sitting, garage sales, and illegal activity 15-20 percent of economic activity Statistics Canada suggests 3.5 percent of GDP Increased with imposition of GST

Labour Unions Worker organizations that seek to improve wages and working conditions through various strategies including negotiations and strikes One-third of workforce is unionized Highest level is in public administration Now unions face new challenges of providing security to workers

Corporations An organization with a legal existence including rights and liabilities apart from that of its members Most large corporations in Canada are public (thousands of shareholders) Most corporations are small, but many large corporations dominate markets Foreign investment is reviewed, but integration is occurring Mega corporations and multinationals dominate the global economy

Mega Corporations The world’s top 10 corporations – including Walmart, Shell and Apple – had a combined revenue of more than the 180 ‘poorest’ countries combined (includes Ireland, Indonesia, Israel, Colombia, Greece, South Africa, Iraq and Vietnam) in 2015 69 of top 100 economic entities are corporations Walmart, Apple, Shell richer than Russia, Belgium, Sweden Source: Global Justice Now 2016 Click here for full Global Justice list

Social Problems Linked to Work Gender, racial and ethnic discrimination Inequality Work-family problems Alienation Vulnerable populations are at risk Sex workers Child labour, esp. on farms a “hidden crisis” Varies by province. Ontario minimum age is 14. <14 only outside of school hours. >16, hours not limited

Unemployment and Social Problems Discriminatory unemployment: ethnicity, gender Structural unemployment: socio-economic factors New problem linked to gendered employment: Canada in past four years, has lost nearly 70,000 jobs in the manufacturing and agriculture sectors At same time, service jobs have increased Greatest impact on men because not prepared to enter into traditional female fields or work for lower pay Unemployment for young men increasing

Source: 'Problem for an entire gender‘ (CBC News Feb. 8, 2017)

Unemployment (cont.) Unemployed increases with “downsizing” esp. in recession February 2017 is 6.8%. Rarely below 5%. Official statistics* understate it (only a % of those still “actively seeking work”) Does not include “discouraged workers”* Does not count part-time work* Some part-time work is involuntary Higher for visible minorities and Aboriginals Higher for younger men and women

Unemployment Rates 1966-2017

Work and Unemployment Related Health Consequences Work problems Workplace safety Work stress Job insecurity Exploitation Unemployment Issues Increased mortality Substance Abuse Depression and Anxiety Increased smoking rate and higher obesity Increased violence Domestic violence

Structural Functionalist Perspective on Work One of most basic social institutions Provides social interaction, social solidarity and cohesion in society Stratification and hierarchy in workforce both natural and normal Unemployment is a dysfunction

Conflict and Feminist Perspective Source of class conflict Bourgeoisie want more labour for less money and proletariat want more pay for less work Problem of the “reserve army of labour” Unemployment keeps wages low Women are exploited for their unpaid labour

Symbolic Interactionist and Social Constructionist Views Work is a major source of identity Also source of status and recognition Social Constructionist: The workforce, work relations, and how people think about work constantly evolving

Discussion: Do we need to rethink professional work in Canada? Business model for law firms in Canada does not reflect changes in workforce or economy In the past 20 years, women have been entering and then leaving law “in droves” (Huffington Post 2005) Although approx 50% of law school students are women, less than 20% make partnership Studies from 1993, 2005, 2008, and more recently a new study by Catalyst of 1400 lawyers at 10 top Canadian law firms notes that both men and women desire a better work-life balance

Rethinking work: what can we do? Women and men report the top factors as important: “…an environment more supportive of family and personal commitments and more control over work schedules.” 84% of women and 66% of men wanted “an environment supportive of my family and personal commitments” “..men and women associates, both junior and senior, cite work-life balance factors as important in choosing to work at another firm than other factors.” A majority of women (66 %) and more than one-half of men associates (54 percent) said fewer hours. (from Catalyst report)

Reflection #8 Fri. March 10 This is the link to Harvard’s IAT (Implicit Association Test) in order for you to complete this week’s reflection paper: https://implicit.harvard.edu/implicit/canada/takeatest.html Reflection is due on Tuesday