Labor in the Global Digital Economy

The Cybertariat Comes of Age

Ursula Huws

• Publisher: Monthly Review Press
• Year: 2014
• ISBN:
  9781583674659
• Topic: Scienze sociali
• Subtopic: Sociologia

For every person who reads this text on the printed page, many more will read it on a computer screen or mobile device. It’s a situation that we increasingly take for granted in our digital era, and while it is indicative of the novelty of twenty-first-century capitalism, it is also the key to understanding its driving force: the relentless impulse to commodify our lives in every aspect.

Ursula Huws ties together disparate economic, cultural, and political phenomena of the last few decades to form a provocative narrative about the shape of the global capitalist economy at present. She examines the way that advanced information and communications technology has opened up new fields of capital accumulation: in culture and the arts, in the privatization of public services, and in the commodification of human sociality by way of mobile devices and social networking. These trends are in turn accompanied by the dramatic restructuring of work arrangements, opening the way for new contradictions and new forms of labor solidarity and struggle around the planet. Labor in the Global Digital Economy is a forceful critique of our dizzying contemporary moment, one that goes beyond notions of mere connectedness or free-flowing information to illuminate the entrenched mechanisms of exploitation and control at the core of capitalism.

1. What Will We Do?

The Destruction of Occupational Identities in the Knowledge-Based Economy

Faced with the difficulty of placing a stranger, the most common opening gambit is to ask, “What do you do?” Except perhaps in a few small hunter-gatherer tribes, a person’s occupation is one of the most important delineators of social identity. In many European cultures this is reflected in family names. People called Schmidt, Smith, Herrero, or Lefebvre, for instance, had ancestors who were iron workers. Wainwrights and Wagners are descended from wagon makers, and so on with the Mullers (millers), Boulangers (bakers), Guerreros (soldiers), and all the myriad Potters, Butchers, Carters, Coopers, Carpenters, Fishers, Shepherds, and Cooks whose names can be found in any North American phone book.

The phenomenon is by no means unique to cultures of European origin. In South Asia the division of labor evolved to become so embedded in other social structures that occupational identity was something you were born into. In the words of Sudheer Birodkar, “Occupational specialisation was the essence of the sub-division of the two lower Varnas (castes) of the Vaishyas and Shudras into the various Jatis (occupational sub-castes). . . . Infringement of caste rules of vocation could lead to expulsion; thus a Chamar (shoemaker) had to remain a Chamar all his life. If he tried to become a Kumar (potter) or Darji (tailor) he was in danger of being expelled from the Chamar caste and obviously under the caste rules he would not be admitted into any other caste in spite of his having the knowledge of any other vocation.”¹

Such discrete craft-based occupational identities began to break down under the impact of automation and the introduction of the factory system. Inherent in capitalist relations of production, according to Marxian theory, is the general tendency to reduce workers to an undifferentiated mass, who can easily replace each other—a working class or proletariat. There is a direct relationship between the degree of skill required to perform any given task and the scarcity of that skill and the ability of the workers who possess it to negotiate with employers (or, in the case of the self-employed, with customers) for high wages and decent working conditions. It is thus in the interests of capital to have a working class whose skills are as generic and substitutable as possible. Workers who have only generic skills are cheap to employ and can be gotten rid of if they become troublesome because substitutes can easily be found.

For socialists, occupational identity, constructed as it generally is around the possession of particular skills, knowledge, or experience, thus presents something of a conundrum. On the one hand, it forms a basic organizational building block; on the other it is a barrier to the development of broader class consciousness. Traditionally most (though not all) organizations of workers have grown up around specific occupational identities in groupings that are simultaneously inclusive, in the sense that they generate strong internal solidarities, and exclusive in the sense that they rely for their effectiveness on strong boundaries and restrictions on entry to the group.

Some of the mechanisms for limiting entry to the occupation, such as apprenticeships, can be traced back to precapitalist forms of organization, such as guilds, whose members were often obliged to take oaths to preserve the secrets of the trade in elaborate initiation rituals and to engage in other practices that consolidated the bonds between members but excluded outsiders. Even much newer occupation-based groupings often exhibit strong social homogeneity in their membership, giving a gendered and ethnic character to who is admitted and who excluded. This can make them divisive in relation to working people as a larger class.

However, through their strong organization and ability to resist being pushed around by the employers, such groups may play a progressive role in winning higher wages or improved conditions for some segments of the workforce or, more broadly, they may lead campaigns for protective legislation or welfare provisions that benefit the population in general. This has especially been the case in countries such as Germany, where social-democratic political parties have taken the lead in developing sector-based, rather than occupation-based, collective bargaining.

Although the welfare states that developed during the post–Second World War period in advanced capitalist countries took distinctive forms, all of them undoubtedly owe many of their achievements to the efforts of workers’ organizations that were strong enough to compel employers to share some of the productivity gains of mass production. As a result, employers and states agreed to a kind of compromise in which they lessened their antagonism to workers’ organizations and labor allowed employers to manage workplaces without constant threat of disruption.² Workers’ organizations did differ in different countries; they were either explicitly occupation-based, as in the craft-based trade unions that were prevalent in the United Kingdom, or based in more general trade unions led by labor elites with strong occupational identities.³ But it should be noted that this same period was also characterized by labor markets that were strongly segmented by gender and ethnicity, as well as being fractured along many other dimensions.

Skill does not just have a double-edged character for labor; it has an equally ambiguous meaning for capital. The innovation process that forms the necessary motor of change for capitalist development is deeply contradictory in its need for skill. Before a task can be automated, it is necessary to draw on the expertise and experience of someone who knows exactly how to do it: to anatomize every step in the process and work out how it can be standardized and how a machine can be programmed to repeat these steps. Once expropriated, the knowledge and experience—or “craft”—of these workers can be dispensed with, and cheaper, less-skilled workers can be substituted to operate the new machines.

But the need for skills does not stop there. Human knowledge, ingenuity, and creativity are also absolutely essential to invent and design new products and processes, customize them for new purposes, communicate and provide content for a wide range of products and services that keep the wheels of capitalism turning, and care for, educate, inform, distract, and entertain the population. Some of these functions are themselves subjected to processes whereby the knowledge of the workers is expropriated and incorporated into computer programs or databases so that the tasks can be carried out by fewer, or less-skilled, workers. Here, for instance, we could include the knowledge of specialists working on technical-support help desks who are encouraged to put the answers to frequently asked questions onto databases that can be accessed by more junior front-line staff, or the knowledge of university professors who are asked to convert their lectures into content for “e-learning” courses. But as one task becomes routinized and deskilled, a new cohort of “knowledge workers” is required to devise the next stage in the commodification process.⁴

Arguments about whether the development of an ever more technologically complex capitalism results in de-skilling or reskilling are therefore beside the point. The nature of innovation is such that both processes happen simultaneously: each new development in the technical division of labor entails a new split between “head” and “hands.” In order to routinize the jobs of one group of workers, another generally smaller group with some sort of overview of the process is necessary. As workers resist or adapt to change and organize to protect their interests, new occupations are continuously being formed and older ones re-formed. Just as occupational identities can be said to be both exclusionary and inclusive, they can also be said to be in a continuous process of construction and deconstruction. Employers have to balance their interest in cheapening the value of labor with their need to ensure that there is a renewable supply of well-educated and creative workers with fresh new ideas. In some situations, companies also want to retain proprietary control over skills and knowledge that give them a competitive edge over their rivals.

It can be argued that traditional Marxian theory underestimates the importance of skill in shaping the ways in which labor markets function. The reality that has evolved is considerably more complex than the classic picture of a polarization of society between a bourgeoisie—that owns the means of production, controls the circulation of goods and capital, and dictates the functioning of the state—and an ever-more homogenous proletarian mass, whose members can be kept in line by the knowledge that any worker who demands too much can be replaced by someone else from the “reserve army” of the unemployed who can do the same work more cheaply or more compliantly. On the contrary, the evolution of an increasingly complex technical division of labor has created a constantly changing demand for an extremely diverse range of skills, many of which are specific to particular stages of industrial development, particular sectors, proprietary processes, products, or even specific companies.

However, despite this multiplication of tasks in a division of labor that is increasingly dispersed both contractually and geographically, the concept of the reserve army is still a relevant one that helps us make sense of many recent developments in labor markets, in this era in which the Post–World War II labor-employer-state compromise (sometimes described as the “Fordist deal”) has either collapsed or is under severe strain. But in order to tease out these understandings, we need a more differentiated idea of the role played by occupational identities and skill in the functioning of labor markets. We also need to look more closely at the role played by the state in providing generic skills to a workforce that is required to fill niches in an increasingly complex and turbulent economy and at the role these generic skills play in eroding occupational boundaries and undermining the power of organized labor.

A starting point for this analysis is the idea of a labor market itself. There are of course many ways in which the very concept of a market in labor is questionable. There is an extreme asymmetry between the characteristics of labor and those of capital, which make the trade in labor quite different from trade in other goods and services. The human body, the basic unit offered on a labor market, has finite limits in terms of its strength, endurance, and agility, as well as in the number of consecutive hours it can keep going, which are different in character from the employing company’s resources, which can be stretched as far as the limits of its access to capital and raw materials. Labor is not physically mobile in the way that capital is, and, in this era of free trade, when capital can cross national borders at will, labor is strongly constrained in its ability to tap into opportunities in other countries. It is often easier for your body parts to cross a national frontier after you are dead than it is for you as a living person to enter that country legally to seek work.

Labor markets are also distorted by many other factors, including monopolies and monopsonies (a single buyer of labor power), cartels, various forms of alliance among businesses or labor, state intervention, and other constraints on the availability of time or mobility (such as the need to carry out unpaid reproductive work) that reinforce gendered and racial divisions in the workforce. A market in which certain jobs are only available to men, or to white people, or to people of a certain religion, cannot by any means be characterized as a “free” market. The most important factor of all, however, in limiting access to jobs and preventing the development of “pure” competition in the market may be employers’ needs for workers with specific skills in a highly complex—and increasingly global—technical division of labor.

One of the most important attempts to re-theorize labor markets was Peter Doeringer and Michael Piore’s groundbreaking book, Internal Labor Markets and Manpower Analysis,⁵ in which they developed the idea of dual labor markets. In this model, jobs fall roughly into two categories: those in “primary” or “internal” labor markets and those in “secondary” or “external” labor markets. Internal labor markets, they argued, are insulated from external market forces by internal rule systems. Employers who need particular skills, tuned to their own specific working practices, are prepared to offer inducements to keep loyal workers, including higher wages, pensions, holidays, and a range of other fringe benefits. Internal markets, they went on to say, are typically highly structured and hierarchical, with internal advancement paths, relying heavily on firm-specific knowledge. In these internal markets, employers are prepared to invest substantially in in-company training in order to achieve high levels of productivity. In other words, the levels of wages and conditions are different from those that would pertain in a “pure” external market. Entry points into these internal labor markets are hard to squeeze through, but once inside workers enjoy a number of benefits. In secondary or external labor markets the unspoken deal between capital and labor is very different: employers do not make a long-term commitment to the workforce but are prepared to accept lower levels of commitment and productivity from workers they feel free to lay off at will. Typical workers in internal labor markets at the end of the 1960s, when Doeringer and Piore were writing, would have been civil servants or employees of large companies such as IBM or General Motors; typical workers in external labor markets would have been janitors or waiters, or self-employed people who offered their skills to a range of different customers.

It soon became clear that this dual model was too simple to explain the complexity of wage differentials across whole diverse economies. Doeringer and Piore’s insights were elaborated by other analysts, to develop models of multiple or segmented labor markets.⁶ The concept of segmented labor markets recognizes that there may be numerous different labor markets in which wages and conditions are shaped by an interplay of factors including national education systems, industrial structures, cultural traditions, labor protection legislation, and the ways in which workers are organized.

In retrospect, we can see that the internal labor markets described by Doeringer and Piore and their followers were not absolute and unchanging features of the economic landscape. Rather, we may perceive them as specific to a certain phase of capitalism, namely, the period of postwar compromise. Although the death of this period is often proclaimed, we cannot be certain that elements of it will not continue to be useful or even necessary for capitalism in the future. However, it is reasonable to conclude that it is past its heyday. To understand how and why it has collapsed it is perhaps useful to look in a little more detail at how it functioned in its golden era.

First, it is necessary to emphasize that the special deal struck by capital with its essential “core” workers inside large organizations only functioned effectively because it did not cover all workers. Although there were historical moments when labor aristocracies used their power to win broad gains for much larger portions of the working class, the lucky insiders were kept aware of their privileged status and, on the whole, kept in order by the knowledge that life out there in the secondary labor market could be harsh. Patterns of inclusion and exclusion were often reinforced by ethnic and gender differences. Second, it is important to remember that the postwar model was not universal, but took different forms in different countries, shaped by their particular industrial structures and histories, including the specific ways that workers’ organizations had evolved. In Germany, for instance, a strong social-democratic movement pushed for sector-level collective bargaining agreements, which meant that the “insider deal” was extended to all workers in a particular sector, rather than just to certain occupational groups (as was common where craft-based unions were strong, for instance in Britain) or in certain companies (as was the case where company-level bargaining was dominant). David Coates has provided us with an extensive analysis of the economy-wide implications of such differences, which have produced distinctive types of welfare systems, patterns of investment, degrees and types of government intervention, and particular training and qualification systems, which are in turn reflected in the ways occupations are defined.⁷ Various types of “insider deal” are also complemented by specific types of “outsider deal,” and this in turn means that the collapse of the postwar compromise took a unique form in each country.

In order to try to model some of these differences, I use a diagram adapted from Rosemary Crompton (see below) to integrate dual labor market theory with gender and class theory.⁸ I have found this diagram useful for analyzing the differences between labor markets in different countries, and particularly for examining how they change in times of rapid structural and technological change, such as the one we are living through right now. This diagram takes internal and external labor markets as two extremes, shown here on the right and the left of the diagram (allowing for the possibility that there may be other intermediate types of labor market segments placed somewhere between these extremes). It then adds another dimension, that of skill, shown here on the top and bottom of the diagram. It should in principle be possible to plot any kind of paid work somewhere in relation to these two axes. For instance, a highly paid executive of a large company or a senior civil servant would be somewhere near the top on the right-hand side, near corner B. But a highly paid freelance accountant working for a number of different clients, although still near the top in terms of skill level, would be over to the left near corner A. Down at the bottom on the right-hand side, near corner D, would be a new recruit or an apprentice at the bottom of the occupational ladder in a large stable institution (for example, a trainee mail sorter). Over on the bottom...