A Job Guarantee Policy

In 1931 John Maynard Keynes predicted that by 2030, people would work no more than fifteen hours a week, dedicating the rest of their time to ‘leisure and culture’. Since the Industrial Revolution, technological advancements have enabled more output to be produced for a given amount of labor, causing the economy to grow and the standard of living to increase. While factory workers worked an average of 63 hours per week in 1870, in 1913 not only did the annual number of weeks worked decrease, but also the hours worked per week decreased to 53.8. Following the Great Depression, in 1940 the 40-hour work week became the norm and this has stuck with us ever since. John Maynard Keynes' predictions have not become reality.

Within our growth-oriented society, efficiency gains due to technological advancements are not being used to prioritize ecological or social well-being by reducing environmental harm or decreasing working hours to make more time for leisure. Instead, increases in efficiency are fueling greater consumption and economic growth.

As technological improvements have made many jobs redundant, economic growth is necessary to uphold employment under the current system. Furthermore, for employment to either increase or stay stable, the economy must grow at a rate that exceeds productivity gains to offset job losses. The growth rates ‘required’ to circumvent ‘jobless growth’ are unlikely to be sustained, however, and many advanced economies focus on producing goods and services primarily to avoid mass unemployment, as opposed to producing only so much as individuals need. This comes as the expense of a prospering planet and human flourishing.

Every one per cent increase in working hours results in a 0.65 per cent increase in carbon emissions. Furthermore, ever-increasing economic growth, mass production and consumption, leads to enormous amounts of waste being produced. Maja Hoffmann attributes the modern day conception of work as being responsible for large-scale ecological destruction; as economies grow richer they produce a greater amount of waste more quickly. Hickel & Kallis researched whether reducing carbon emissions and material throughput while sustaining economic growth is possible. The so-called  ‘green growth theory’ aimed to make economic growth possible without violating ecological boundaries, through absolute decoupling of GDP growth from resource use and carbon emissions. However, in an extensive analysis of empirical data, Hickel & Kallis demonstrate that absolute decoupling of resource use or carbon emissions, combined with continued economic growth is not possible on a global scale.

Modern production processes rely on enormous amounts of material and energy inputs. The global competition within and between capitalist societies has led to an unparalleled rise in labor productivity, whereby the efficiency of ecologically destructive processes are continuously improved. It is almost no surprise that three of nine planetary boundaries (climate change, nitrogen cycle and biodiversity loss) have already been violated. Given the adverse effects of modern economies and their growth paradigm on our planet, the need for a steady-state economy becomes apparent. Thus, in a non-growing economy, producing goods and services simply to keep employment levels high would be impossible, and the need to decouple employment and environmental impacts becomes apparent. Given the adverse implications of modern day work on ecological well-being, (disregarding the effects of it on human health and social relations), the question is how work should be organized in a post-growth society.

The need to redefine work is crucial as we transition towards a post-growth world. In doing so, working hours must not only be reduced substantially, but the nature of work itself must be rethought. While the eight hour and five day work week has been predominant during the majority of the last century, in recent years the idea of a four-day week has gained popularity. For certain countries like the United Arab Emirates this concept has already become reality. However, the premise of this concept is that company goals are still being met and productivity does not decrease. Its aim is to uphold capitalism, productivity and output. Merely doing less of the same is not the answer to our ecological and social concerns. In order to prioritize social needs and ecological sustainability, we must rethink existing economic relations and put human needs centerstage.

One way to decouple employment from economic growth would be to implement a ‘Job Guarantee’ policy. This policy was first introduced in the New Deal of the Roosevelt administration, to counteract unemployment; thus initially not designed to provide solutions for environmental concerns. It has been described as the right to paid work at a base wage, which is not dependent on the growth rate of a given economy, with the state being the ‘employer of last resort’. As states are the monopoly supplier of their currency, with which they can purchase almost anything, governments could pay for unemployed people and therefore fund a Job Guarantee policy. 

The jobs created by this policy would create value for society and improve people’s lives as opposed to merely increasing output. Governments can create these jobs in environmentally sustainable or welfare maximizing projects, enabling that fundamental social and ecological needs are met. As profit maximization is not the sole goal of the Job Guarantee policy, these jobs created would probably not have been undertaken in the private sector. Moreover, as individuals always have the option of working in a government-sponsored job, the private sector would be obliged to provide equal working conditions and wages with those offered by the state. Thus, this policy would improve working conditions altogether. Workers would be relieved from the pressure of our competitive global capitalism, and could sustain a livelihood.

Implementing such a large-scale policy would be no easy undertaking, and real life examples show its major pitfalls: In India, a similar scheme, known as the NREGA, was introduced. However, corrupt officials and deficit financing to fund the program, amongst other reasons, have led to unintended consequences which ultimately caused the policy to fail. Therefore, a Job Guarantee policy, in its magnitude as envisaged by many degrowth academics, might seem utopian.

Nonetheless, it is apparent that sustaining low unemployment levels leads to a strong need to keep the economy in an ever-growing state, in which output is continuously maximized. People are driven to consumption habits that far exceed their basic needs. In order to sustain low unemployment levels without the need of keeping the economy in an ever-growing state, a Job Guarantee policy is a promising proposal. Although empirical evidence on the effectiveness of a Job Guarantee policy is contested, there is a urgent need for further research into the potential benefits it could offer, with an emphasis on drawing practical lessons from real-world examples.