When Work Disappears

I've been talking about this for years - mostly because I've seen it happening all around me here in the entertainment industry and hear about it tangentially from friends in other industries.  Now McArdle, Krugman, and Reynolds are catching on,  Firstly, I think the social effects of work elimination are vastly underrated.  On a macro-level, sure, you can make the argument that new jobs will be invented.  (although it isn't clear that trend is continuing)  But that doesn't do much good for a young family with a 2 and 4 year old when both parents are out of work and need health insurance.  And we need young families to survive and prosper -- if we expect America and the human species -- to continue into the future.  Secondly, you need a middle class for democracy to prosper.  The topic itself deserves a larger blog entry, but if the majority of your citizens are either on the dole or have no stake in the society, you can be pretty sure trouble is just around the corner.

There is another issue as well.  Down here in LA on the fringes of the entertainment industry, there is one type of "growth" industry, that is the web-series, internet video type of stuff.  In fact, I know quite a few people who work either full time or part time or have worked job-to-job basis in some type of media job where the primary space of content is the web.  Superficially, this should be cause for celebration.  Growth.  New jobs replacing old.  Opportunities and so forth.  I would be very hesitant to celebrate.  The VAST majority of these jobs barely pay a living wage.  They end up employing a lot of young people right out of college.  Most probably do not get health insurance.  Most, I'm sure, have no type of retirement plan.  And most don't have equity in the companies themselves, so I'd be wary of characterizing this as a hotbed of entrepreneurial activity.  The fact is, the web stuff is uncharted territory and importantly, most of the money is coming from investors versus customers.  No one has figured out a model yet -- not in journalism, not in music, and not in entertainment -- to deliver a consistent profitable business.  Maybe some on the high end will prosper -- although I think the business model basically is "lets get bought by Google."  My basic point:  these are not middle class jobs.  They pay too little and are excessively risky.  And for them to become "middle class" type of jobs, ie a job where someone can comfortably raise a family, they would, in essence, come to resemble traditional entertainment jobs (which are disappearing).  Hence, the problem.