By Dr Bhalchandra Kango
In capitalist economy, unemployment is one of the basic needs that keeps the worker always on the edge. The apprehension of job loss haunts all those in employment. And those unemployed keep in wait at the gate to replace those who dare challenge the system. There is never complete employment. Also the fear of job loss makes the toiler succumb to accept any wages offered. For the capitalist economy, it is necessary to keep wages low and maintain higher profits. However, unemployment that exceeds a certain threshold is typically not acceptable. As a result, daily unemployment figures are prominently featured on most television networks in Europe and the United States.
Recent economic trends are altering the employment landscape, leading to calls for employment statistics to include self-employment, which warrants further examination. It is well known that as the service sector grows in GDP and the number of contractual and self-employed workers increases, the standard of living and social security for this segment of society become crucial.
Organized workers, following the Great Socialist Revolution of 1917 and through their ongoing struggles, won many rights, such as the formation of trade unions, the establishment of an eight-hour workday, and the introduction of minimum wages. However, the general crisis of capitalism that emerged in 1929-30 and the subsequent depression were not observed in the Soviet Union.
It was concluded that by ensuring jobs for everyone, the market in the socialist world was protected. As a result, the capitalist system adopted welfare economics and learned important lessons. We observed the formation of trade unions, an increase in wages, and the introduction of various laws, such as those related to provident funds (PF), the Employees’ State Insurance Corporation (ESIC), dearness allowance, unemployment insurance, and protections against industrial closures.
This development was made possible due to the struggles of workers. However, following the introduction of new technology, the weakening of the socialist bloc, and the implementation of new economic policies, the power of trade unions and the public sector has significantly diminished. As a result, many benefits previously enjoyed by workers have been gradually withdrawn. For instance, four new labour laws in India are set to replace 44 existing labour laws. Unfortunately, these new laws are pro-management and fail to address the evolving economic and social landscape.
Social security and permanent employment were the backbone of the industrial economy. However, with the rise of finance capital, this foundation has shifted. Nowadays, social security is limited to only a few groups of workers, and job security is increasingly under threat.
The introduction of AI and robotics is further transforming the employment landscape. AI will likely eliminate well-paid jobs, such as those held by accountants, chartered accountants, and legal experts. These middleclass, skilled workers who once felt secure in their positions now risk losing their jobs. In a recent interview, renowned economist Abhijit Banerjee highlighted this concern about rising inequality.
Another area of concern is the demand for longer working hours. Infosys founder Mr. Narayan Murthy has called for a workweek of 70 hours, while Subrahmanyan, the CEO of L&T Company, suggested a workweek of 90 hours. It is noteworthy that neither of them proposed an increase in wages for employees, despite the fact that the salaries of CEOs and top executives have risen by more than 600 percent in recent years compared to those of other employees. This situation has contributed to increased inequality and reduced consumption in the economy.
The Trade Union movement achieved its most significant victory in the late 19th century by securing an eight-hour workday after a prolonged struggle by workers. May 1st, recognized as International Workers’ Day, serves as a reminder of this struggle. The advent of electricity also played a vital role in supporting this demand. There is a discussion about advocating for a reduction of working hours from eight to six per day as a potential solution to combat unemployment and promote growth, even without an increase in jobs. However, aggressive capitalism in the present century is pushing for longer working hours and lower wages. In fact, in many industrial sectors in India and other developing countries, 12-hour shifts have become the norm.
The International Labour Organization (ILO) has noted that deteriorating working conditions and increased workloads are becoming common trends worldwide. As a result, many economists are calling for a shift in focus from just discussing employment to considering the quality of those jobs. Additionally, self-employment is losing appeal as many people prefer self-employment over non-permanent work.
We must remember that workers fought for job security, living wages, and social security benefits. As self-employment becomes a significant component of the job market, society faces the challenge of providing adequate social protection and ensuring decent wages or profits. Trade unions will need to address this issue. One proposed solution is to provide pensions for everyone after age 60. Other areas of concern include the demand for social security measures such as universal pensions, health benefits, affordable public transportation, access to public education, and skill training programs.
It is reasonable to consider self-employment as a form of employment; however, society and the government must ensure that self-employed individuals have a minimum standard of living and access to social security. Recently, during a debate in Parliament regarding employment, it was argued that making and selling tea or bhajias also qualifies as a form of employment.
It is essential to recognise that after working 8 hours, a tea vendor or bhajiya seller should receive a living wage and social security after a few years of employment. This crucial point was overlooked in the debate. The Modi government, failing to create the promised jobs, is now arguing that self-employment should also be considered employment. This argument must be challenged while addressing the evolving economic landscape.
It is important to recognize that capitalists have targeted trade unions and lowered wages to boost their profits. According to a study and observations by renowned French economist Thomas Piketty, workers’ wages worldwide have declined since 1990. The International Labour Organization (ILO) has also expressed concern about worsening working conditions and decreasing wages. Additionally, they have highlighted the rise of precarious jobs and increased workloads for workers.
A new, glorified working class is emerging under the pretext of “self-employment,” exemplified by companies like Zomato, Swiggy, Uber, and Ola. While many changes are occurring, the overall direction is clear: workers are facing increased workloads, longer hours, reduced wages, and a lack of social security. These issues need to be challenged, which can only be achieved through collective efforts and struggles. (IPA Service)