Poor naked wretches, whereso'er you are,
That bide the pelting of this pitiless storm,
How shall your houseless heads and unfed sides,
Your loop'd and window'd raggedness, defend you
From seasons such as these? O, I have ta'en
Too little care of this! Take physic, pomp;
Expose thyself to feel what wretches feel,
That thou mayst shake the superflux to them,
And show the heavens more just.

"Is the world always to remain as it was when Lear made his prayer? Is it ever to remain as it is now? I hope not. Are there always to be millions whose lips are white with famine? Is the withered palm always extended, imploring from the stony hearts of respectable charity, alms? …. Are the rich always to be divided from the poor – not only in fact but in feeling?" ¹

Like Lear when he had a day job, I also took "too little care" to think about what we as a society or country could do about unemployment and the misery it caused. Lear-like, I too remained unexposed to the worst excesses of exploitation, insulated by the unshakable fairness of the Tata and Godrej credos as I knew them. In recent years, I did lift my ostrich-head above the sand but lulled myself into contentment after some glib tax 'jugaads' or angry moralizing. 

Part of my hesitation also sprang from my unwillingness to venture opinions in the domain of Economics with very little formal education in the discipline. The last several years of study have taught me, however, that the seemingly impregnable (and, for me, unscalable) fortresses of mainstream economics have some glaring cracks in their bastions. According to critics, "…the so-called science of economics is a melange of myths that make the ancient Ptolemaic earth-centric view of the solar system look positively sophisticated in comparison. If we leave the development of economics to economists themselves, then it is highly likely that the intellectual revolution that economics desperately needs will never occur – … economics is too important to leave to the economists.… [O]ver the last thirty years, …[t]he world has been remade in the economist’s image. This ascendancy of economic theory has not made the world a better place. Instead, it has made an already troubled society worse: more unequal, more unstable, and less 'efficient'." ² As I read more, I gained hope from the thinking of a brilliant group of economists who were sufficiently far away from the mainstream for me to have missed their work almost entirely till I started digging. I now believe there is a practical way to end joblessness and would like to share it in this column.

Inadequate alternatives 

After the reforms of the early ‘90s, many of us thought it was only a matter of time before the neo-liberal policies that followed in its wake would junk joblessness. That time now appears to stretch towards infinity. Economists who advocate the Full Employment Model (FEM), point out that classical economics fails to address unemployment because it requires a certain proportion of people out of employment for their model to retain a degree of stability and retain a check on inflation. "…[E]conomists regularly talk about unemployment … as something that is not only inevitable but also necessary for the smooth functioning of the economy – and formulate policies on the premise that there is a 'natural' level of unemployment... Low unemployment, the argument goes, could cause high or even accelerating inflation, producing one of the clunkiest concepts in economics – the Non-Accelerating Inflation Rate of Unemployment (NAIRU). Inflation-fighting central banks then aim to finetune the economy around the NAIRU. Countless think tanks, academics, and government institutions spend valuable resources on trying to identify this elusive 'optimal level' of unemployment… [However,] the NAIRU is a myth… It is hard not to conclude that the NAIRU has provided cover for the profound policy failure of tackling unemployment head on… But unemployment is not at all unavoidable, and direct measures to wipe it out are the superior policy option."³  The conventional approach seems to be analogous to attempting to boil an egg while using only a home’s central heating as the source of energy. Even if the central heating’s temperature could be raised limitlessly, the home would burn down long before the egg got hard. The answer is obvious: heat the egg directly. As the last sentence of Tcherneva’s quote makes plain, that is precisely how FEM deals with unemployment.

I was even more misguided in thinking that, if markets can’t cure unemployment, preaching would. Homilycides kill reader interest as surely as homicides kill people and columns such as 'Countering the Merchants of emplocide^'4  may have pricked a few CHRO consciences but been a soporific for many more. Don’t get me wrong. CHROs need to speak out against the mindless sacrifice of durable jobs. Basic equity makes that demand. Similarly, CHROs must play the role of marketers for productive talent in durable employment. However, these will not solve the countrywide job shortage caused by demographics, automation, offshoring, imports and increasing reliance on the informal sector – whether through outsourcing or contractualization. AI will aggravate matters manifold.

The option I have found most difficult to set aside is the Universal Basic Income (UBI). This column is not focused on UBI but, for those who wish to understand its claims, I cannot do better than recommend books by Phillipe Van Parijs⁵ and Rutger Bregman⁶. With some reluctance, I have to point out why FEM scores over it. Commonsensically, it seems wasteful to pay not just the truly needy but huge numbers of well-off individuals who do not need such support. Though there is sufficient research to the contrary, one cannot avoid a residual fear that there could be a moral hazard lurking in a sustained UBI. Most importantly, productive work is central to the humans we now are. "The decision to work and behaviour at work are not solely motivated by the desire and need to consume… [I]f organized in the right way, work provides people with the opportunity to satisfy needs essential for well-being, such as the need for self-realization, the need for relatedness and the need to live a meaningful life."⁷  Would we really be justified in taking away one of the reasons that makes life rich (in a non-monetary sense)? Lastly, it does appear there could be less than altruistic motives for supporting UBI. "The jobs vs. income debate is somewhat a false either/or, but it is not surprising that one-percenters… still favour the UBI overwhelmingly… A job guarantee threatens corporate power, while an income guarantee subsidizes it."⁸  All that having been said, if FEM proves impractical or otherwise unacceptable, UBI may be the only choice left.

In favour of FEM

Murray and Forstater provide a strong case for FEM. "The ideal model for a Job Guarantee program is to institute a [centrally] funded, locally administered program that puts all those with the willingness and ability to work into paid employment. The ideal model is a universal program…. [T]he program combats ecological destruction and promotes social and economic equity among genders, classes, and races in the developed and developing world… The Job Guarantee program operates in a countercyclical manner, hiring labour during economic downturns and selling labour to the private sector during economic upswings as workers leave public sector employment for more lucrative positions in the private sector. The ability of workers to shift from employment in the private sector to public sector employment (and vice versa) promotes macroeconomic stability by maintaining higher levels of final demand during economic downturns."⁹  It is worth reemphasizing the benefit FEM will bring to climate and ecological sustainability.¹⁰  

Additionally, and no less importantly, FEM would counter inflation and mass layoffs while easing the transition of the jobless into the formal sector. "[A]n employment buffer stock would stabilize the price of a most essential resource in the economy (labour), which is an input of production for any other commodity, thus stabilizing their prices as well. Furthermore, spending on the Job Guarantee program itself would offset deflationary pressures (when it expands in recessions) and inflationary pressures (when it shrinks in expansions). Thus, it would be a superior inflation control mechanism than unemployment… The Job Guarantee does not just cure unemployment. It has important preventative features as well. First, it frustrates the explosive nature of mass layoffs… [and] the psychological effects of uncertain job prospects… [T]he Job Guarantee… would also serve as a job-placement program. It would allow people to transition from unemployment to employment, and from the Job Guarantee to other private, public, or non-profit work. It would train and prepare them for other employment opportunities via on-the-job training, credentialing, education and other wraparound services. A Job Guarantee could be especially helpful to young people having trouble securing their first job, inmates looking for work, the long-term unemployed with significant barriers to reemployment, and caregivers who may wish to return to the labour market." ¹¹

Funding FEM

Jeremy Riddle wrote: "Every dream has a process and a price tag. Those who embrace the process and pay the price, live the dream. Those who don't, just dream." Time to talk about paying for our grandiose vision of a job guarantee. The first two suggestions in this section are symbolic but necessary.

It seems only fair that corporates which eliminate swathes of durable employment should share some of the pain their actions impose on the individuals dispensed with as well as on the economic system that has to provide for them. Diligent readers may recall "… the proposal to add a slimming cess on profits linked to the reduced percentage of (permanent and contract) employees… The beauty of this idea is that, for companies that are genuinely struggling and have negligible profits, there will be no cost as a result of the cess." ¹² This stick should work well to give decapitators pause, especially when administered with the tax reduction carrot suggested in an earlier column for enterprises generating durable employment. ¹³

Another way to alert those still employed about the wolf of unemployment that could await them one day and give them an opportunity to assist those already ravaged by its fangs is to have them contribute to an unemployment fund. "The major show of solidarity retained employees can be asked to show is through a reduction in their Costs to the Company (CTC) including allowances and all benefits. Only half of this saving should accrue to the company, with the rest going towards a National Unemployment Fund which will be the subject of a future column." ¹⁴

The major part of FEM funding, however, has to be the state – provided it has sovereign power over its currency (as India does). "To better protect our economy – and, more importantly, the people, families and communities in it – MMT [Modern Monetary Theory] recommends the addition of a powerful new automatic stabilizer [k]nown as a federal job guarantee… Because it is a driverless stabilizer, the steering wheel will always turn in the right direction at the right moment in time… [A]ny currency-issuing government has the power to eliminate domestic unemployment simply by offering to hire the unemployed. If it decides not to exercise this power it is choosing the unemployment rate." ¹⁵I shall leave it to Kelton’s book to convince you why such spending will not give rise to the problems generally associated with deficit financing. Not all economists agree with Modern Monetary Theory but I place myself firmly in the camp of those who do.

HR Impact

Neither HR nor even the corporate sector as a whole will be central actors in transitioning to FEM. This is not to say they are not required to make a vital contribution or remain unaffected by the outcome. I would like to share three such touch points – ranked from the sublime to the selfish.

For several years, Nani Palkhivala, the eminent lawyer and self-taught economist, delivered an annual lecture after the finance budget of the central government. Addressing packed audiences, in huge venues like Brabourne Stadium, he dissected arcane provisions in terms that laypersons could understand. He was not bothered if he ruffled the FM’s feathers or ventured some distance away from his core competence in law. He was a public intellectual speaking up in a domain adjacent to his prime expertise for the sake of benefitting all of society. We are all pygmies in comparison to such giants but that does not absolve us from propagating significant changes for the public good. The job-crushing footprints of corporates are no less damaging than their carbon footprints. If business and HR leaders wish to enjoy the flexibility of engaging and disengaging employees as strategy dictates, they cannot close their eyes to what happens to the humans when they are edged out of corporate portals. FEM provides what is, in my opinion, the best post-portal path for the country’s population. Those of us who deal with employment decisions and processes owe it to our fellow countrymen to take up the FEM cause in whichever Brabournes we can access. 

There is a more practical contribution HR practitioners, academics and consultants can make to the operation of FEM. The efficacy of the constantly varying pool of public sector employment demanded by FEM, which is very different from public sector employment as we know it currently, will depend on managing inflows and outflows with agility and delivering effective minimalistic training to the same individual repeatedly. Motivation and discipline will acquire many different colours for these employees. Moreover, coping with substantial inflows of knowledge workers (which the shenanigans of the IT majors are bound to yield) will require compensation structures far more complex than a minimum MNREGA wage. All of these will open up entirely new dimensions of HR which will check all job delight boxes (except the one for immediate monetary compensation). Some pointers for intrepid HR idealists are available in an earlier column (about HR for non-profits)¹⁶  but much of the excitement of fresh HR practice exploration will remain for the pioneers to discover.

I turn last to a selfish consideration but one which has afflicted the lives and consciences of all of us who have carried out a full range of HR assignments. Retrenchments scar the souls of HR practitioners who execute them even if the material consequences for them are negligible compared to the victims. Regardless of the rewards and promotions they get after managing the euphemistically termed 'restructurings' demanded from them, the harm they cause their fellow humans must surely prompt them to ask: "For what is a man profited, if he shall gain the whole world, and lose his own soul? or what shall a man give in exchange for his soul?"¹⁷  Is that not a good enough reason to turn FEMwards?

Notes:

1. Robert Ingersoll, Letters, Harvard Business School Press India Limited; Updated, Expanded edition, 2013.
2. Steve Keen, Debunking Economics: The Naked Emperor Dethroned?, Zed Books; 2nd edition, 2011.
3. Pavlina R Tcherneva, The Case for a Job Guarantee, Polity, 2020.
4. Visty Banaji, Countering the merchants of emplocide, People Matters, 10 February 2023, (https://www.peoplematters.in/article/employee-relations/countering-the-merchants-of-emplocide-36862).
5. Phillipe Van Parijs, Basic Income: A Radical Proposal for a Free Society and a Sane Economy, Harvard University Press, 2017.
6. Rutger Bregman, Utopia for Realists, Bloomsbury Publishing PLC, 2018.
7. Lopes, Helena, Why Do People Work? Individual Wants Versus Common Goods. Journal of Economic Issues, 45(1), 2011.
8. Peter-Christian Aigner and Michael Brenes, The Long, Tortured History of the Job Guarantee, The New Republic, 11 May 2018.
9. Michael Murray and Mathew Forstater, Introduction, from Full Employment and Social Justice – Solidarity and Sustainability, Ed Michael Murray and Mathew Forstater, Palgrave Macmillan, 2018.
10. Josefina Y. Li, Can Capitalist Modes of Production Be Biophysically Sustainable?,  from Full Employment and Social Justice – Solidarity and Sustainability, Ed Michael Murray and Mathew Forstater, Palgrave Macmillan, 2018.
11. Pavlina R Tcherneva, The Case for a Job Guarantee, Polity, 2020.
12. Visty Banaji, Countering the merchants of emplocide, People Matters, 10 February 2023, (https://www.peoplematters.in/article/employee-relations/countering-the-merchants-of-emplocide-36862).
13. Visty Banaji, Make JOBS in India, Angry Birds, Angrier Bees – Reflections on the Feats, Failures and Future of HR, Pages 222-228, AuthorsUpfront, 2023.
14. Visty Banaji, Countering the merchants of emplocide, People Matters, 10 February 2023, (https://www.peoplematters.in/article/employee-relations/countering-the-merchants-of-emplocide-36862).
15. Stephanie Kelton, The Deficit Myth: Modern Monetary Theory and How to Build a Better Economy, John Murray, 2021.
16. Visty Banaji, Non-profits Don’t Have to be Non-people, Angry Birds, Angrier Bees – Reflections on the Feats, Failures and Future of HR, Pages 146-153, AuthorsUpfront, 2023.
17. Matthew 16:26, King James Bible.