David and Helen talk with Diane Coyle about what the pandemic has revealed about the changing nature of work. Who is doing more of it? Who is still getting paid for it? Which jobs are not coming back? Plus we explore the impact of the digital revolution on how we get rewarded for what we do and we ask whether the big tech firms can continue to hoover up so many of the rewards. Is Jeff Bezos really worth it?
Since the post-war era, unpaid work in the home doesn’t get measured in formal economic statistics.
- At the time, people argued it would be too hard to measure.
- When women went out to work in the paid workforce, the market started growing.
- The digital revolution brought a lot of things we paid for back into the home, for example, online banking.
The pandemic has exacerbated existing social patterns and trends.
- Women are more likely to have been laid off and furloughed. The hardest hit sectors, such as hospitality and retail, employ more women.
- All working parents have been hit hard.
- In a self-inflicted recession, the service sector has been hit hardest (instead of manufacturing).
- Key workers are not our best paid workers. Those who can work from home are, broadly speaking, more well off.
Official economic statistics are analytical and statistical constructs.
- If we ran surveys about what households are doing, we would have measures of these things.
- You can’t devise good policies about social care or pensions about understanding who is doing what.
- The statistics we have were created in relation to a particular mode of economic management: Keynesian demand management.
- We no longer think that’s a sufficient way of thinking about economic activity, or the more human issues around economic activity.
The financial market economy today bears little relationship to the real productive economy.
- This is essentially because central banks have (intentionally or not) propped up markets with asset purchases.
- We will see a continuation of the trend since 2008 of greater asset inequality.
What has the pandemic done to people’s economic psychology?
- Fear might make recovery harder.
- Certain sectors like hospitality and entertainment depend on people moving from one place to another and gathering in close proximity.
- People’s expectations from the government may also have changed.
Information technologies have become part of our fundamental economic infrastructure and often these markets are dominated by only one corporation.
- After 2008, large companies like Amazon that weren’t making profit at the time still had access to huge amounts of cheap credit and could engage in share buybacks.
- The end of people’s ability to physically go shopping has been a huge boon to Amazon in particular. Online retail doesn’t suffer like the high street.
- Right now, Amazon is seen to be providing a vital service. Does this make it less likely that policymakers will take it on?
There may still be a shock coming, especially when the furlough scheme winds down.
- Is it too late to save the brick and mortar economy?
- If we are moving towards a more digital economy, we’ll have to rethink taxes too.
Will the pandemic take us back to an earlier version of the digital economy? Will we go back to living further apart?
- There’s a limit to how much you can do online.
- The shift towards urban centers took off in the 90s, before the tech revolution. It’s probably more about the shift away from manufacturing towards service-sector economies.
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