Labor Day, Work, and Progress

Labor Day is one of my favorite holidays because it honors work. The history of work is the history of civilization itself. Aside from those relatively few of us who are engaged in the full time mothering or fathering of the next generation, it is work which principally defines us and our role in this world. At least until we are too old or too rich or too dysfunctional to work any more.

Other animals may hunt, forage or dig for the nutrition to sustain life, but only mankind works. In a very real sense, work is one key element that makes us human.

At the dawn of civilization, work was performed mostly by family members or by slaves. The concept of employment represented a more complex and advanced stage of civilization. The accelerating change in the technology of work and organization we live with today is transforming employment. Many jobs in large organizations now have a "bottom line" attached, so that the individual's and work group's results are measured and rewarded, almost as if a small entrepreneur were counting the daily receipts and profits at the end of each day.

Adopted more than a century ago in acknowledgment of the then-growing clout of the labor union movement, Labor Day was a new extra day of rest for "working man" (a term which is now painfully un-PC for exactly the sort of people who used to fashion themselves as champions of the proletariat) that gave honor to toil by offering brief respite from it.  In those days, the obvious point of a labor union was to get more and more money for doing less and less work. Before the advent of the 5 day work week and the 8 hour day (thanks to the labor movement), when people working full time for a major company in often hazardous and unpleasant jobs could barely survive, that default strategy made a lot of sense.

The previous hundred years had seen a radical change in the nature of work and of employment relations. The 19th century gave rise to a previously unknown phenomenon: the giant corporation, controlled by professional managers who were not themselves the proprietors. Unconstrained by the sort of face-to-face contact with workers that characterized traditional owner-operator employers, the new impersonal corporations could and did often treat their employees like a coal or iron deposit, to be ruthlessly exploited and discarded when no longer of further value. The rise of the big corporation created the need for the labor movement to act as a countervailing power in the new era.

How times have changed.

While manufacturing has remained a relatively constant share of our economic activity, it is accomplished with fewer and fewer workers. As Peter S. Goodman writes today in the Washington Post:
The United States makes more manufactured goods today than at any time in history, as measured by the dollar value of production adjusted for inflation -- three times as much as in the mid-1950s, the supposed heyday of American industry. Between 1977 and 2005, the value of American manufacturing swelled from $1.3 trillion to an all-time record $4.5 trillion, according to the Bureau of Economic Analysis.

With less than 5 percent of the world's population, the United States is responsible for almost one-fourth of global manufacturing, a share that has changed little in decades. The United States is the largest manufacturing economy by far. Japan, the only serious rival for that title, has been losing ground. China has been growing but represents only about one-tenth of world manufacturing.
This mirrors a similar transformation that took place in the agricultural sector that began over a century ago, with expanding production and a shrinking labor force. The advent of agricultural machinery -- the harvester, the tractor, and the tiller for example -- vastly enhanced labor efficiency. The ability to sell commodities like wheat on national and global markets enabled the remaining farmers to specialize and produce on a scale unthinkable to the traditional semi-subsistence farmers of the 18th century, who grew crops to feed their families and sell the extra to the miller in town in order to generate "cash money" for necessities and maybe a few extras purchased mostly from local craftsmen and merchants.

The very same kinds of forces are at work today on the manufacturing sector. The information revolution is transforming manufacturing from a labor and energy-intensive activity into an information and knowledge-driven sphere, where much of the value is added by people who work on computers or otherwise apply brainpower to the processes of physical transformation of raw materials into products. In the wake of containerization of shipping, which radically drove down the price of transporting goods across oceans and continents, and the subsequent liberalization of trade, more and more of the physically-demanding work of manufacturing, dependent on brawn and endurance more than brains, has been transferred to lower wage countries.

There is a certain kind of intellectual who decries this trend, bemoaning the fact that a high school dropout can no longer find gainful unionized manufacturing employment that can pay for a house, two cars, maybe a boat and a yearly family vacation. Most of these critics never worked a day on an assembly line. If they had, they would not sentimentalize the aching muscles, mind-deadening boredom, and helpless thralldom to the pace dictated by the machinery that faces those stuck in old-style manufacturing.

For people accustomed to traditional agricultural labor, work in a factory can be a step upward, a relief from a different kind of drudgery, albeit with a price in loss of control over the pace of work and a separation from nature's blessings (and ravages). But when I left high school and began my first (of three) summer jobs working in machine-driven factories, the shock of industrial labor quickly drove home to me the human cost of the Industrial Revolution. I faced no blast furnaces or hazardous machinery. The most dangerous implement I ever worked with was a pneumatic screwdriver. Yet these jobs left me aching, exhausted, and full of respect for those who spent their working years chained to factory work. Knowing that the alternative to getting a good education was at best a return to unionized factory labor was a marvelous incentive to applying myself to the work of learning.

But big sophisticated corporations, with profit center accounting and shadow equity and all the other marvelous innovations of the controllers and accountants, comprise a declining share of employment. More and more of us work in small businesses, many of them home-based. Others work as independent contractors, selling our services to companies and individuals. We may not be a "nation of shopkeepers" as Napoleon sneered that the British were, but we are becoming a nation of entrepreneurs.

All in all, this is a positive development. It is true that those who live this way have less job security than the career-long employee or a stable large corporation protected by union grievance procedures or merely the tradition of a company being a "good employer" as that term was understood. But in return we get that most precious gift: autonomy, at least in some degree. And with that autonomy comes another gift, one which often seems a burden: responsibility.

Employment divorced from responsibility and accountability is a trap. Like a narcotic, it feels good but leads to bad outcomes. The American automobile industry illustrates well the perils of building a framework in which workers and their unions are driven by a quest to do less for more, and the management (itself often insulated) and stockholders are the only ones accountable for the results. I confess that the job security, health and retirement benefits offered to UAW members in last half of the 20th century looked awfully good to me. But what good are they now to the UAW members facing loss of benefits, layoffs, and potentially the death of the Big Three? Have the interests of the unions and their members really been served by the triumphs of the past generation of labor negotiators?

In today's competitive world economy, only one group of employees can potentially thrive in an environment of low accountability and ever-more pay for ever-less work: government workers. The new class structure of the American labor force consists of an overclass of government employees with guaranteed retirement benefits, health care coverage, work rules, and job security. Governments are for the most part exempted from competitive forces, though states and cities can and do lose economic activity to more competitive locales.

I strongly suspect that the next frontier of class conflict in the United States will be comprised of a struggle over the privileges of the government worker class, along with a struggle to find risk-management systems for the growing class of small entrepreneurs, independent contractors, home-based businesses, and quasi-entrepreneurs embedded in larger organizations.

I think we are making progress. But nobody ever said that progress -- or work for that matter -- is supposed to be easy. We live in interesting times when it comes to work.

Thomas Lifson is editor and publisher of American Thinker.
Labor Day is one of my favorite holidays because it honors work. The history of work is the history of civilization itself. Aside from those relatively few of us who are engaged in the full time mothering or fathering of the next generation, it is work which principally defines us and our role in this world. At least until we are too old or too rich or too dysfunctional to work any more.

Other animals may hunt, forage or dig for the nutrition to sustain life, but only mankind works. In a very real sense, work is one key element that makes us human.

At the dawn of civilization, work was performed mostly by family members or by slaves. The concept of employment represented a more complex and advanced stage of civilization. The accelerating change in the technology of work and organization we live with today is transforming employment. Many jobs in large organizations now have a "bottom line" attached, so that the individual's and work group's results are measured and rewarded, almost as if a small entrepreneur were counting the daily receipts and profits at the end of each day.

Adopted more than a century ago in acknowledgment of the then-growing clout of the labor union movement, Labor Day was a new extra day of rest for "working man" (a term which is now painfully un-PC for exactly the sort of people who used to fashion themselves as champions of the proletariat) that gave honor to toil by offering brief respite from it.  In those days, the obvious point of a labor union was to get more and more money for doing less and less work. Before the advent of the 5 day work week and the 8 hour day (thanks to the labor movement), when people working full time for a major company in often hazardous and unpleasant jobs could barely survive, that default strategy made a lot of sense.

The previous hundred years had seen a radical change in the nature of work and of employment relations. The 19th century gave rise to a previously unknown phenomenon: the giant corporation, controlled by professional managers who were not themselves the proprietors. Unconstrained by the sort of face-to-face contact with workers that characterized traditional owner-operator employers, the new impersonal corporations could and did often treat their employees like a coal or iron deposit, to be ruthlessly exploited and discarded when no longer of further value. The rise of the big corporation created the need for the labor movement to act as a countervailing power in the new era.

How times have changed.

While manufacturing has remained a relatively constant share of our economic activity, it is accomplished with fewer and fewer workers. As Peter S. Goodman writes today in the Washington Post:
The United States makes more manufactured goods today than at any time in history, as measured by the dollar value of production adjusted for inflation -- three times as much as in the mid-1950s, the supposed heyday of American industry. Between 1977 and 2005, the value of American manufacturing swelled from $1.3 trillion to an all-time record $4.5 trillion, according to the Bureau of Economic Analysis.

With less than 5 percent of the world's population, the United States is responsible for almost one-fourth of global manufacturing, a share that has changed little in decades. The United States is the largest manufacturing economy by far. Japan, the only serious rival for that title, has been losing ground. China has been growing but represents only about one-tenth of world manufacturing.
This mirrors a similar transformation that took place in the agricultural sector that began over a century ago, with expanding production and a shrinking labor force. The advent of agricultural machinery -- the harvester, the tractor, and the tiller for example -- vastly enhanced labor efficiency. The ability to sell commodities like wheat on national and global markets enabled the remaining farmers to specialize and produce on a scale unthinkable to the traditional semi-subsistence farmers of the 18th century, who grew crops to feed their families and sell the extra to the miller in town in order to generate "cash money" for necessities and maybe a few extras purchased mostly from local craftsmen and merchants.

The very same kinds of forces are at work today on the manufacturing sector. The information revolution is transforming manufacturing from a labor and energy-intensive activity into an information and knowledge-driven sphere, where much of the value is added by people who work on computers or otherwise apply brainpower to the processes of physical transformation of raw materials into products. In the wake of containerization of shipping, which radically drove down the price of transporting goods across oceans and continents, and the subsequent liberalization of trade, more and more of the physically-demanding work of manufacturing, dependent on brawn and endurance more than brains, has been transferred to lower wage countries.

There is a certain kind of intellectual who decries this trend, bemoaning the fact that a high school dropout can no longer find gainful unionized manufacturing employment that can pay for a house, two cars, maybe a boat and a yearly family vacation. Most of these critics never worked a day on an assembly line. If they had, they would not sentimentalize the aching muscles, mind-deadening boredom, and helpless thralldom to the pace dictated by the machinery that faces those stuck in old-style manufacturing.

For people accustomed to traditional agricultural labor, work in a factory can be a step upward, a relief from a different kind of drudgery, albeit with a price in loss of control over the pace of work and a separation from nature's blessings (and ravages). But when I left high school and began my first (of three) summer jobs working in machine-driven factories, the shock of industrial labor quickly drove home to me the human cost of the Industrial Revolution. I faced no blast furnaces or hazardous machinery. The most dangerous implement I ever worked with was a pneumatic screwdriver. Yet these jobs left me aching, exhausted, and full of respect for those who spent their working years chained to factory work. Knowing that the alternative to getting a good education was at best a return to unionized factory labor was a marvelous incentive to applying myself to the work of learning.

But big sophisticated corporations, with profit center accounting and shadow equity and all the other marvelous innovations of the controllers and accountants, comprise a declining share of employment. More and more of us work in small businesses, many of them home-based. Others work as independent contractors, selling our services to companies and individuals. We may not be a "nation of shopkeepers" as Napoleon sneered that the British were, but we are becoming a nation of entrepreneurs.

All in all, this is a positive development. It is true that those who live this way have less job security than the career-long employee or a stable large corporation protected by union grievance procedures or merely the tradition of a company being a "good employer" as that term was understood. But in return we get that most precious gift: autonomy, at least in some degree. And with that autonomy comes another gift, one which often seems a burden: responsibility.

Employment divorced from responsibility and accountability is a trap. Like a narcotic, it feels good but leads to bad outcomes. The American automobile industry illustrates well the perils of building a framework in which workers and their unions are driven by a quest to do less for more, and the management (itself often insulated) and stockholders are the only ones accountable for the results. I confess that the job security, health and retirement benefits offered to UAW members in last half of the 20th century looked awfully good to me. But what good are they now to the UAW members facing loss of benefits, layoffs, and potentially the death of the Big Three? Have the interests of the unions and their members really been served by the triumphs of the past generation of labor negotiators?

In today's competitive world economy, only one group of employees can potentially thrive in an environment of low accountability and ever-more pay for ever-less work: government workers. The new class structure of the American labor force consists of an overclass of government employees with guaranteed retirement benefits, health care coverage, work rules, and job security. Governments are for the most part exempted from competitive forces, though states and cities can and do lose economic activity to more competitive locales.

I strongly suspect that the next frontier of class conflict in the United States will be comprised of a struggle over the privileges of the government worker class, along with a struggle to find risk-management systems for the growing class of small entrepreneurs, independent contractors, home-based businesses, and quasi-entrepreneurs embedded in larger organizations.

I think we are making progress. But nobody ever said that progress -- or work for that matter -- is supposed to be easy. We live in interesting times when it comes to work.

Thomas Lifson is editor and publisher of American Thinker.