The growth economy suffers from a productivity paradox. Corporations compete to reduce the time and effort that goes into production processes, which is generally seen as a sign of efficiency, but in reality has a troubling outcome.
Unless more stuff is produced and consumed, people lose their jobs as the same output can be achieved with fewer workers. This is why so many well-meaning people around the world fear the prospect of low growth, even when they recognise that the current form of industrial development is destroying the social fabric and natural ecosystems of societies.
Such a structural unemployment problem is further compounded by the real prospect of massive automation replacing humans in production chains. A study by Oxford University predicts that robots are likely to displace no less than 50% of jobs in the US and Europe in the next 20 years.
Machines are putting people out of work in emerging economies too, including in China, which has long been the global job creator. According to Martin Ford, bestselling author of The Rise of the Robots, most routine jobs are becoming obsolete. As Ford says:
We must decide, now, whether the future will see broad based prosperity or catastrophic levels of inequality and economic insecurity.
Unless societies change their approach to growth and development, they will not only end up with a broken planet and conflict-ridden communities: they will also face massive unemployment. There is no way the vertical structures of production dominating the current industrial system will generate enough jobs, let alone good jobs, to satisfy our needs.
As I describe in Wellbeing Economy: Success in a World Without Growth, the only way out of this predicament is to empower people to become producers and consumers at the same time. Or what I call “prosumers”. They must be capable of making most of the things they need through local systems of co-production and networks of small businesses.
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