Real Jobs or Real Income?

Another part of my work on economic growth is focused on how the traditional job in the traditional large corporation is becoming a relic of the past.  It came out of an industrial era in which large corporate bureaucracies were created for reasons of efficiency.  See the economist Ronald Coase’s classic work on the theory of the firm.

The internet, however, has made it easier for people to collaborate in a more informal way and to create projects of great value – such as Linux and Wikipedia.  I describe this as a movement from Coase to Shirky (author of Here Comes Everybody).

This role of the Internet has already begun to affect the economy.  So it was with interest that there was some recent publicity on CNBC and MSNBC about the success of Thumbtack and ODesk, which help people find income on the Internet, rather than finding traditional jobs.  See, for example, “Online Work Replacing Full-Time Employment: Record Unemployment, Recession Mentality Lead Companies to Alternative Hiring Strategies” at http://www.msnbc.msn.com/id/44017638

The MSNBC interview of ODesk’s Gary Swart was frustrating to watch as he and the reporter kept talking past each other.  The reporter kept saying that these were not “real jobs”.  Mr Swart was diplomatic enough not to argue that those “real jobs” were no longer so real.  Nor did he offer the rejoinder that many of people who use his service to identify sources of income were probably quite pleased to be able to have the flexibility that Internet work provides.  These people also find they make more money than they would make at a so-called “real job” flipping burgers.

Even in an economy with traditional job unemployment measuring at anywhere from 9-18%, most Americans are concerned – perhaps not so much about “jobs”, but about the fact that their real income has gone down, even if they have a real job.  Anything that boosts their income is positive and an indicator of the strategy for the future.

© 2011 Norman Jacknis

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