News & Current Affairs
02 December 2014
by Geoff Lines
Unemployed ? Get used to it!
So why do I say this and who am I to make this claim. The answer to the first question is one word: efficiency.
The answer to the second. I worked in the IT industry for 25 years: 1980 – 2005. During that time, I worked in technical and sales roles visiting many industries and seeing the efficiency technology could bring. (until I fell out of it because I was over all the hype)
One thing the IT industry does well is to enable efficiency. I have on my mantle piece a 400 Megabyte drive that cost me $2,800. That was $7.00 per megabyte in 1991. Last week, at Officeworks you could get 4 terabytes (that's 4,000 megabytes) for $199.00. That's $0.05 cents per megabyte. Now, that's efficiency.
Efficiency is what every CEO wants from their business. And one of the most expensive resources is people.
And don't think the efficiency drive is new. When the pharaohs were building their pyramids and realised that it only took 200 slaves to drag a stone block that was rolling on tree trunks compared with the 400 required to move it when the stone was on the ground, they immediately started using more tree trunks as rollers.
As you sit and eat your Weetbix just consider what you are eating, and your environment.
The wheat for your Weetbix was harvested by just one person driving a combine harvester that can easily harvest over 100 acres over a 10 hour day. Go back 100 years and look at the manpower to do that work.
The milk you poured over the Weetbix came from a diary farm run by a farmer and his wife to milk a couple of hundred cows. Three times a day. Compare that to the labour required one hundred years ago.
The truck that picked up the milk carries thousands of litres a time to the processing plant which is highly automated. In the next 20-30 years (probably even less) that truck will be driving itself. Check this out.
The wheat delivered to Uncle Toby's, to be turned into Vitabrits was processed in a plant that has been downsizing its staff since it was built. How do I know this? A friend of mine used to work at the Uncle Toby's plant in Wahgunyah, Victoria.
The car you are about to drive to work in is half-built by robots and no one reconditions engines anymore. They just replace them. It's faster and more efficient to simply throw another engine in and melt the old one down.
How do I know this? I spent a couple of years at Kangan Institute's Automotive Center of Excellence. A very smart auto technician I met there referred to fixing cars now as 'appliance maintenance'. They don't fix components anymore in cars. They replace the bit that's broken. Less time and more efficient.
The house you live in. Do you want a new one? Well, very soon most houses won't be built on site. You will select the design and it will be prefabricated in a factory. The walls, roof trusses etc. will be delivered to the site and assembled. This happens already but not on a large scale.
How do I know? Because in the late 80's / early 90's my brother had some spare time so he and his wife built a few houses. All the walls and roof trusses were prefabricated and delivered to the site, mounted on bolts sticking out of the concrete slab and bolted together. One afternoon my brother and I erected and bolted together the side of a house. That's right, 4 hours to get half a dozen frames up and bolt them down. And yes, they were very heavy, but I was a lot younger. And that was 25 years ago.
Don't believe me. Check this out. 3D printing for new houses. A 25 square house being built in 20 hours. Now that's efficient.
On the way to work you probably dropped your daughter at university to get a quality education. But why are they actually going physically to university? Is it for a lecture?
Universities are slowly moving lectures, from a real professor delivering each lecture to a class in a lecture theatre, to simply posting the lecture on Youtube - Desire2Learn. All students can now watch it whenever they want. What does this mean? If you are doing a degree at any university in any English language subject, anywhere in the world, you could all be watching the same video. That's a lot of unemployed professors.
And when your daughter submits her university paper it first goes to Turnitin to be checked for plagiarism. A teacher doesn't do it. A computer does. Simply more efficient.
On the way home, did you stop at the supermarket? Notice how few people now work in supermarkets. My mother used to operate the till and pack groceries at a local supermarket. There was no barcode scanning back then. Both Woolworths and Coles want you to check yourself out at the automated checkouts. Why ? Less people. More efficient.
Perhaps, you stopped at the bank to do some banking. Notice how many tellers there are. Well it is going to become less. Banks are now working on getting the branch staff down to a maximum of 1-2 people per branch and handling most transactions online or by automated teller machines.More efficient.
So simply put, farming, business, manufacturing, logistical and retail efficiency is reducing the number of people needed to perform the work. Which means there are fewer jobs to go around. And on top of this there are more people that need work.
There is always the argument that new technologies bring new jobs. This is true, but all industries, even new ones, are so efficient that they do not need lots of bodies.
Right now at the time of writing the Australian population is 23,693,227 people.
Australiais predicted to reach 70 million people by the end of the century. Melbourne is going to go from 4.2 million in 2012 to approx 8.6 million in 2061.That's only 46 years.
So what's the point?
Already today companies get hundreds of applications for a single position. We have students with double degrees that cannot get work.
What does this mean? NOT EVERYONE HAS TO WORK.
DO YOU UNDERSTAND? NOT EVERYONE HAS TO WORK.
A complete change in our thinking has to take place. The efficiencies in farming, manufacturing, business, logistics and retail have reduced - and are further reducing - the need for people to be employed.
Add to this the population growth around the world, with all countries competing in the global food production and manufacturing industries, means that over priced Australians are going to have even less jobs in major food and goods production.
And if you don't believe this statement, take a look at the manufacturing industry in Australia. Ford, Holden (GM) and Toyota are all leaving. Australians cost too much. The in-country market is too small and too far away from the global markets.
Currently the global population is just over 7 billion. To check out what it might be when you read this click here. The latest research seems to suggest that global population will peak at around 9-10 billion people. Here's what has happened. And here's the future prediction.
So how does this affect the world and Australia?
Globally we produce an excessive amount of goods (food, vehicles, houses, buildings, appliances and stuff), and if you do not think so take a look at Target, Kmart and Big W.
Australia could stop producing all food and consumer goods and the rest of the world could pick up the supply. And because we have to pay for the standard of living of our own workers, if we got everything from overseas, the prices would most probably go down.
Don't expect the politicians to come up with any ideas as our political system is broken. Any system that works in a popularity contest is flawed from the start. Understand the following priorities.
Tony Abbott's first job is to stay leader of the Liberal Party and try and keep the liberal party in power. The Prime Minister's salary is $507,338. The Leader of the Opposition earns $360,990. That's 146,000 good reasons to be in power.
His second is to keep his major benefactors happy. Yes, that's big business.
His third job is trying to keep the country going. So you rank third on his list of priorities. At best.
Belief in our political leaders is at an all time low for a couple of reasons. The first reason is that they have spun themselves to the point where no one believes a word they say.
The second major thing is their lack of a long term vision. Neither party knows what to do with the economy or employment. And the reason for this is because we are living an experiment. Never has mankind been in the position we are now.
A global economy, global warming, social and cultural change, religious beliefs, scientific and medical breakthroughs are all developing and changing, impacting our lives and the change is happening so fast that governments have no idea what to do. I must point out that even the great social and scientific thinkers cannot answer the questions of how countries should be run either.
But the key conversation that we most definitely need to have is what we do with all the people who are not required to work.
Are we going to label them as dole bludgers and alienate them from general society because they do not want to pursue a path that we think is relevant? Are we going to value their input even if we don't think it has any value? Are we going to make them apply for 20 jobs a month? We know that takes about 20 minutes on www.seek.com.au. And it's a pointless exercise.
The politicians will say that there are jobs for everyone as long as we have more growth. But that is not only unachievable in a finite world, it is also unsustainable. And in a world that has now stopped its global boom and has stagnated, it is downright laughable.
It's typical of a system where the political leaders actually have no real idea what to do and lack any insight on addressing the real issues that are developing in an ever changing world.
You may disagree with me but there are some key points you cannot disagree with.
- Business efficiency and technology are slowly removing the need for human beings to work.
- Increasing population and a global economy means more people are all going for the same jobs.
- New industries require less people because of efficiency.
- Australians are too expensive to employ and be globally competitive which means large corporates are not coming to Australia unless they really have to.
The big elephant in the room that no politician wants to talk about is population growth and control. But the other big elephant in the room, that no one will admit, is the lower rate of workforce participation required by the population to feed, house and secure all of us while we amuse ourselves to death.
And let me tell you. Those are two really big elephants that the current political system is too scared to address. And the room is getting really full.