"The Silent Exodus Nobody Sees: Leaving Work Forever"
by Charles Hugh Smith
The exodus out of cities is getting a lot of attention, but the exodus that will unravel our economic and social orders is getting zero attention: the exodus from work. Like the exodus from troubled urban cores, the exodus from work has long-term, complex causes that the pandemic has accelerated. These are the core drivers of the exodus from work.
1. Labor's share of the economy has been in multi-decade decline. It's easy to blame globalization and/or automation--and it's true that the decline in labor's share accelerated from 2000 on. But this trend began around 1970, long before China joined the World Trade Organization and the advent of "software eating the world." (see chart below)
2. While it's convenient for those reaping the big gains (see chart below) to blame globalization and/or automation, the real driver was financialization - the neoliberal move to deregulate finance so it could turn everything into an exploitable "market" that could be made to serve one master: shareholder value, the innocuous-sounding code-phrase for anything goes and winner takes most - if you're rich.
Shareholder value was the super-wealthy's self-serving justification for unlimited greed as corporations went from being enterprises serving communities, the national interest, employees, customers and shareholders to financialization machines whose sole purpose was enriching insiders via loading the company with debt to pay huge bonuses to top managers, stock buybacks funded by debt, the abandonment of trustworthy accounting principles and so on.
Financialization and the deification of shareholder value sluiced all the gains into the hands of the few at the top at the expense of the many. As the chart below indicates, the top 0.1% enjoyed income gains of around 350% since 1979 while the bottom 90% barely topped 20%--a number that would be sharply negative if real-world inflation were included.
Simply put, the bottom 90% - wage-earners - lost ground over the past four decades of financialization while the wealthy winners of financialization became super-wealthy. The rewards of labor/work have diminished to an extraordinary degree for the bottom 90%, and even the 91% - 99% bracket has found their labor has mostly served to enrich those above them.
These trends will drive both the top wage-earners and the bottom wage earners out of the workforce. The managerial class that keeps the whole machine glued together can either retire or use their human and financial capital to find other less stressful ways to make a living and downsize their expenses to match their reduced income.
Some will be voluntary, many will be involuntary, but the results will be the same: a mass exodus of hard-to-replace skilled workers. This is what I'm calling the take this job and shove it exodus.
Once the Federal Reserve starts sending "free money" directly to households, many at the bottom of the pay scale will realize they too can take this job and shove it. "In Unprecedented Monetary Overhaul, The Fed Is Preparing To Deposit "Digital Dollars" Directly To "Each American" (Zero Hedge)
'I cry before work': US essential workers burned out amid pandemic. Essential workers reported stress caused by increased workloads, understaffing, fears over Covid and struggles in enforcing social distancing. (The Guardian)
What few well-paid apologists seem to realize is that to equal the purchasing power of the minimum wage I earned in 1970 ($1.65/hour), the minimum wage would have to be close to $20/hour now. The absurdly under-reported rate of official inflation (the Consumer Price Index) claims that a minimum wage of $12/hour now equals the purchasing power of $1.65/hour in 1970, but since I've kept records of all expenses I can report that this is totally false.
As the chart below shows, wages' share of the economy has been in a relentless 50-year slide. The entire machinery of inflation calculation has been driven by the desperate need to mask the true collapse of the purchasing power of wages.
Once the workforce awakens to this, the silent exodus out of the workforce will gather into a flood tide. Permanent unemployment payments, Universal Basic Income (UBI), free Fed money--regardless of the program or name, these will enable a mass exodus of those at the bottom of the workforce pay scale while burnout will also decimate the ranks of essential managerial / skilled workers.
It's payback time, people. Hey, Financial Aristocracy, clean your own floors and slaughter your own meat. Hey, corrupt politicos and apparatchiks, wipe your own tables and watch your own brats. The take this job and shove it exodus is silently gathering momentum.
The Protected Class of pundits, technocrats, flunkies, toadies and enforcers believes the take this job and shove it exodus is "impossible", just as everyone believed the Titanic was unsinkable. Just as the Titanic sinking went from "impossible" to inevitable, so will the take this job and shove it exodus move from "impossible" to inevitable."
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All said well and good. But along with the '80's was the advent of cheaper more powerful computing. At that point, most investors were cut out of the process; the Glass-Stegall Act was aborted; Banks no longer offered reasonable rates of return on savings accounts forcing investment into FIRE. But computing, Wall Street, nano-second trading should have been prevented. This is pure out market manipulation by algorithms and resources unavailable to the main street investor. This scam has been going on too long and now it has reached a crescendo of epic proportions with the FED printing so much fake paper, the entire enterprise is criminal.
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