Labor Displacement and Public Policy

Abstract

Change is an inevitable part of every dynamic society. Economic changes which displace labor include changes in consumer preferences which result in unemployment for those producing goods no longer desired , technical changes, in which the same product is produced with less labor, and political -economic changes , which cause labor displacement as a direct or indirect result of a conscious policy decision. Under tradition, public policy, and law, the source of labor-displacing change is a primary determinant of the availability and extent of any assistance'' for those persons displaced. In Europe, virtually all workers are guaranteed some form of adjustment assistance, including mandatory 30-day notice before severance, severance pay, and (often) retraining and relocation assistance. In the United States, adjustment is provided as a result of private negotiations (usually between union and management) or because the federal government has assumed an obligation for those displaced. Collective bargaining agreements which provided private adjustment to displaced workers include the meat-packing automation agreements of the early 1960's and the longshore containerization agreements in the late 1950's. Federal adjustment is provided to those in domestic industries who lose work time or employment because of import competition and to individuals who may be displaced by government-mandated rail or mass transit re-organization, park expansion, or environmental protections. Individuals involuntarily displaced typically suffer substantial income (and psychic) losses. Earnings in the year after displacement are often only 50 to 75 percent of earnings in the year before displacement. Individual hardship varies in relatively predictable patterns. Older workers, those with fewer skills, those unable to leave the area, and those who are female or belong to minority populations suffer the most severe income losses. The extent and distribution of income losses depends on both individual and area characteristics. Area unemployment conditions are most critical in determining re-employment ease or difficulty, but advance notice, employer-union cooperation, and the active involvement of local employment service personnel can reduce the duration of unemployment and improve prospects for satisfying new employment. Current concern for the labor displacin3 consequences of agricultural mechanization results from the nature of labor-displacing change, the lack of private and public adjustment for displaced farm laborers, and the existence of real income losses among those displaced. Although some 700, 000 persons do some farmwork for pay each year in California, the vast majority work less than 10 days in agriculture. The resulting work pattern assures farmworkers multiple sources of income, which limits income losses when any single crop harvest is mechanized. In designing and administering any assistance program for farmworkers, the high proportion of workers and these multiple income sources make it difficult to avoid a Hobson's choice: exclusion of the casual workforce or providing incentives to many persons to do a few days of farmwork in order to qualify for displacement compensation. Some agricultural research is conducted with public monies. If this research results in labor-saving innovations , what responsibility does government (or its agents) incur for the plight of displaced labor? If one adopts the legal notion of culpability, responsibility rests with the initiator of displacing change, i.e., the university. But if the benefits of agricultural mechanization accrue to society-at-large, general labor market can be justified. General adjustment is usually favored by manpower researchers, since it is often more effective and efficient and avoids horizontal inequities (providing different benefits to similarly situated persons).