We are still very concerned with the high unemployment rate in the USA. President Obama’s stimulus plan has helped change the situation, but not enough nor soon enough.
Beside the concern about unemployment, many worry about an aging population, with fewer working people paying the freight for more and more on Medicare and Social Security. They see instead of 10 in the work force paying for one retiree, a future in which 3 or 4 workers pay for each retiree. What this view conveniently overlooks is that it is the economy that pays for the retirees, not the individual worker. If 3 or 4 workers in the future produce as much as 10 workers today, then the burden caused by each retiree will be no more.
How can this be, you ask? Well one should remember that at the beginning of the 20th Century about half the US work force was engaged in agriculture producing enough to feed our population and more. By the end of the century less than 2% of the US work force was engaged in agriculture and still producing enough to feed us and a substantial share of the rest of the world. In other words, it took only one farm worker to do the job of 50. The amount of food was still the same, in fact it was more.
In 1960, at the height of manufacturing as a share of the work force, some 26% of the US work force was in the manufacturing industry. By the year 2002 this fell to less than 13%. But manufacturing output actually increased.
Of course all this is due to increased productivity of workers. Fewer workers can now provide sufficient food and other goods for the population. Add to this the current concern that we are consuming too much by virtue of massive new sources of easy credit, and one could argue that we should lower, not raise, the retirement age, since fewer people working can more than take care of all of us.
But this denies an essential feature of American society, your job, and implied income, establishes your position in our society. We Americans are the only people on earth who ask first, when meeting someone new, “What do you do?” No other people ask this on being introduced to a new person. As I always put it, while we have the most mobile society in the world, where one can instantly go up or down, it is also the most crass, since it hinges on how much money you are making. Anywhere else your rank in the social pecking order rests on other factors, who were your parents, where were you educated, what talents do you have, what is your religion, if you have one, where are you from and so on.
Now I exaggerate a bit here since these other factors also play a part in fixing your social status in America, but your job and income are the key factors. It also explains why so many Americans question the usefullness of their children exploring endless fields of study in school that appear to have no relationship to getting a job. They have a hard time accepting the idea of education for the sake of education alone.
All this means that if you have no job in the USA, you are a social “nobody.” Being employed takes on more meaning than simply earning your keep. And that is why we put more emphasis on jobs than perhaps any other people.
So what happened to those people no longer needed by agriculture and industry? Thank God they found jobs in the service sector, which now employs about 85% of the work force, and are able to maintain a position in American society.
The dilemna for America is how is our society going to survive when we do get to a future where few people have to work to provide all we want? We have already seen that this is true for agriculture and industry. How much longer can we prop up the underlying foundation of our society by inventing new services or by stimulating excessive demand with imaginative new sources of credit?