Ethics for the Information Age Chapter 8 – Work and Wealth
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Topics
Introduction Automation & Unemployment Automation and Job Creation Working Less, Making More Effects of Increase in Productivity Workplace Changes
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Topics
Telecommuting Advantages Telecommuting Disadvantages Temporary Work Monitoring Multinational Teams IT Sector Unemployment
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Topics
Foreign Workers in the IT Industry The Digital Divide The “Winner-Take-All” Society Access to Public Colleges
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Introduction
Overseas outsourcing Cost of Indian technical service representative about 1/6 of US Simultaneous overseas telephone capacity now about 2.5 million calls
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Introduction
Cost savings can be overestimated The economy is becoming globalized Digital divide Unequal distribution of benefits
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Automation & Unemployment
Job Destruction – 1979 -1994 43 million US manufacturing jobs lost – 1947 manufacturing jobs were 35% of US workers – 2002 manufacturing jobs accounted for 12% of US workers
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Automation & Unemployment
Job Destruction – Manufacturing output has doubled since 1970 – 1977 – it took 35 person hours to produce one automobile – 1988 - 19.1 person hours per automobile
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Automation & Unemployment
Lost white collar jobs – Secretarial and clerical positions disappearing – Circa 1980 pharmacies filled about 8,000 prescriptions per day – Merk-Medco currently fills 8,000 per hour through a robotic, web-accessible pharmacy
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Automation & Unemployment
Working harder, making less – Between 1970 and 1990 average American working hours increased by 163 hours per year – Downsizing leaves fewer people to do the same amount of work
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Automation & Unemployment
Working harder, making less – Technology allows us to take work with us – We are coming full circle from cottage industries to home or partially home workers
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Automation and Job Creation
While technology eliminates some jobs, it creates others Our economy is shifting from manufacturing to service and information
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Automation & Job Creation
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Service vs. Manufacturing Jobs
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Working Less, Making More
Compared to 1900 we Work fewer hours Produce more Earn more Have access to a greater variety of jobs
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Effects of Increase in Productivity
US productivity doubled between 1948 and 1990 We work more hours than in any society at any time in history – Mid 4th century Romans had 175 public festivals per year
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Effects of Increase in Productivity
We work more hours than in any society at any time in history – Medieval English holidays totaled 4 months per year – Protestant work ethic – Time versus possessions
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Workplace Changes
Technology has changed how we work Organizational changes – Early automation of back office procedures such as payroll required no changes – Later integration of functions such as sales and inventory helped flatten organizations
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Workplace Changes
Organizational changes – Information paths are no longer linear – Supply chain automation reduces paperwork and the need for people to process it
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Telecommuting Advantages
Increased productivity Decreased absenteeism Improved morale Widens employee pool
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Telecommuting Advantages
Decreased overhead Improves resilience through dispersion Good for the environment through decreased commuting Employees save money
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Telecommuting Disadvantages
Threatens control and authority of managers Decreases or eliminates face to face interaction Decreased information security Harder to schedule team meetings
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Telecommuting Disadvantages
Decreased employee visibility Decreased contact with off site employees Isolation of remote employees Teleworkers work longer hours for the same pay
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Temporary Work
Modern business environment changes rapidly Companies once boasted of no layoffs Currently business environment relies on subcontractors and temporary employees Workers no longer rely on longevity, but on "knowledge portfolio"
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Monitoring
Tracking Internet usage Monitoring telephone usage Checking email content Computer file monitoring Keystroke capturing
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Monitoring
25% of UK companies have fired employees for improper Internet usage A recent study showed that 30 - 40% of office Internet usage is not work related
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Monitoring
Monitoring can indicate need for training to improve quality or productivity Can tailor information to a person's location
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Multinational Teams
Allows for around the clock operations without requiring multiple shifts Provides diversity and multiple viewpoints
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Globalization
Worldwide network of businesses and markets Made possible by decreasing cost of IT
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Arguments for Globalization
Increases competition Increases employment in developing countries Poor countries become more prosperous through exports Interdependent countries are less likely to go to war with each other
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Arguments Against Globalization
US should not be subordinate to the WTO American workers are forced to compete with foreign workers who do not receive fair treatment, such as child laborers
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Arguments Against Globalization
Causes loss of American jobs US subsidized businesses, such as farms can operate below cost and undercut foreign farmers unfairly
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IT Sector Unemployment
1990's dot-com boom and speculation led to unnatural expansion Early 2000 the bubble burst Silicon Valley lost 13% of non agricultural jobs, highest since the Great Depression
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Foreign Workers in the IT Industry
H1-B visas valid up to six years Hiring company must certify that no qualified Americans are available Foreign workers must be paid prevailing wage Prevalent in IT Quota reduced to 65,000 for FY 2004
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Foreign Workers in the IT Industry
L-1 visas Allows companies to bring current, foreign employees to US Does not requirement of prevailing wage
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The Digital Divide
Disparity between those with technology and Internet access and those who do not Exists between countries Social divide is between rich and poor within a country
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The Digital Divide
Global divide – Poorer countries with little individual wealth – Inadequate telecommunications infrastructure – English language is not prevalent – Low rate of education and literacy – Country's culture does not make it a priority
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Internet Access by Region
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Social Divide
Disparity in Internet access within a country 2000 survey of Internet use – – – – – – –
18 – 29 year olds – 66% Age 65 and older – 13% College degree – 74% High school drop outs – 18% Whites – 50% Hispanics – 46% Blacks – 35%
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Models of Technological Diffusion
New technology is expensive Price drops as technology matures First VHS VCR cost $1,000 in 1977 Price dropped 98.5% between 1976 and 2003 Normalization model Stratification model
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Critiques of the Term Digital Divide
Promotes the idea of ‘haves’ versus ‘have nots’ as simply one of access Ireland produces a great deal of IT products They are not high consumers of IT 1997 – Ireland’s telecommunications company held a contest to select and fund an “Information Age Town” Winner was Ennis, a town of 15,000
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Critiques of the Term Digital Divide
$22 million prize ($1,200) per resident Every business was provided with – ISDN line – Web site – Smart-card reader
Every family received – Smart-card – PC
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Critiques of the Term Digital Divide
3 years later, most IT was unused Benefits not fully explained or understood Formerly, unemployment claims filed in person, which also served social function After new IT, applications filled online Many PCs later sold on the black market
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Critiques of the Term Digital Divide
Social systems must support IT change “Digital Divide” implies binary division Access is actually a continuum “Digital Divide” implies that lack of access is a disadvantage
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The “Winner-Take-All” Society
The Declaration of Independence declares that “all men are created equal” We are not equal in society What if we were all guaranteed the same income? “From each according to his abilities, to each according to his needs.”
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The “Winner-Take-All” Society
IT and efficient transport makes it easier for products to dominate world markets Network economies encourage people to use the same product English has become the dominate language of business Business norms have changed
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Harmful Effects of Winner-Take-All
Increases the gap between rich and poor Attracts many people to lucrative, but socially unproductive work Creates wasteful investment and consumption Competition for elite schools increases Less well known but good schools suffer
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Reducing Winner-Take-All Effects
Societies can enact laws limiting business hours Businesses can form associations with their own rules Progressive and luxury taxes remove some incentives Campaign finance reform reduces influence of the wealthy
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Access to Public Colleges
It is proven that in general more education equates to higher salaries State’s funding of higher education has decreased since 1980 Tuition must make up the difference Tuition rise has outpaced income growth 63% of Americans believe education should be paid for by students and families
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Ethical Analysis
Should states make college available to all qualified high school graduates? Requires state funding of difference between cost and ability to pay
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Utilitarian Analysis
Goal of state is universal access Cost to state may average 50 – 75% of actual Average college graduate makes $20,000 per year more than a high school graduate Difference over 35 years is almost $750,000 At a tax rate of 12%, this means $84,000 more in taxes paid Graduates less likely to be jailed, unemployed, etc.
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Utilitarian Analysis
More graduates can lower the value of a degree Other consumers of state resources can not pay their way A degree does not guarantee success
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Kantian Analysis
Perfect duty is fulfilled in all cases Imperfect duty is general, but not applicable in all cases Is providing access to higher education a perfect duty, imperfect duty or neither?
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Social Contract Theory Analysis
Rawl’s second principle of justice states that inequalities of income and wealth must be to everyone’s advantage and all qualified must have equal access to positions of responsibility Greater education leads to positions of greater authority Children from poorer families have unequal access to education, therefore power
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Questions & Discussion
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