Ethics for the Information Age

Ethics for theInformation Age Chapter 8 – Work and Wealth William H. Bowers – whb108@psu.edu

Topics • Introduction • Automation & Unemployment • Automation and Job Creation • Working Less, Making More • Effects of Increase in Productivity • Workplace Changes William H. Bowers – whb108@psu.edu

Topics • Telecommuting Advantages • Telecommuting Disadvantages • Temporary Work • Monitoring • Multinational Teams • IT Sector Unemployment William H. Bowers – whb108@psu.edu

Topics • Foreign Workers in the IT Industry • The Digital Divide • The “Winner-Take-All” Society • Access to Public Colleges William H. Bowers – whb108@psu.edu

Introduction • Overseas outsourcing • Cost of Indian technical service representative about 1/6 of US • Simultaneous overseas telephone capacity now about 2.5 million calls William H. Bowers – whb108@psu.edu

Introduction • Cost savings can be overestimated • The economy is becoming globalized • Digital divide • Unequal distribution of benefits William H. Bowers – whb108@psu.edu

Automation & Unemployment • Job Destruction • 1979 -1994 43 million US manufacturing jobs lost • 1947 manufacturing jobs were 35% of US workers • 2002 manufacturing jobs accounted for 12% of US workers William H. Bowers – whb108@psu.edu

Automation & Unemployment • Job Destruction • Manufacturing output has doubled since 1970 • 1977 – it took 35 person hours to produce one automobile • 1988 - 19.1 person hours per automobile William H. Bowers – whb108@psu.edu

Automation & Unemployment • Lost white collar jobs • Secretarial and clerical positions disappearing • Circa 1980 pharmacies filled about 8,000 prescriptions per day • Merk-Medco currently fills 8,000 per hour through a robotic, web-accessible pharmacy William H. Bowers – whb108@psu.edu

Automation & Unemployment • Working harder, making less • Between 1970 and 1990 average American working hours increased by 163 hours per year • Downsizing leaves fewer people to do the same amount of work William H. Bowers – whb108@psu.edu

Automation & Unemployment • Working harder, making less • Technology allows us to take work with us • We are coming full circle from cottage industries to home or partially home workers William H. Bowers – whb108@psu.edu

Automation and Job Creation • While technology eliminates some jobs, it creates others • Our economy is shifting from manufacturing to service and information William H. Bowers – whb108@psu.edu

Automation & Job Creation William H. Bowers – whb108@psu.edu

Service vs. Manufacturing Jobs William H. Bowers – whb108@psu.edu

Working Less, Making More • Compared to 1900 we • Work fewer hours • Produce more • Earn more • Have access to a greater variety of jobs William H. Bowers – whb108@psu.edu

Effects of Increase in Productivity • US productivity doubled between 1948 and 1990 • We work more hours than in any society at any time in history • Mid 4th century Romans had 175 public festivals per year William H. Bowers – whb108@psu.edu

Effects of Increase in Productivity • We work more hours than in any society at any time in history • Medieval English holidays totaled 4 months per year • Protestant work ethic • Time versus possessions William H. Bowers – whb108@psu.edu

Workplace Changes • Technology has changed how we work • Organizational changes • Early automation of back office procedures such as payroll required no changes • Later integration of functions such as sales and inventory helped flatten organizations William H. Bowers – whb108@psu.edu

Workplace Changes • Organizational changes • Information paths are no longer linear • Supply chain automation reduces paperwork and the need for people to process it William H. Bowers – whb108@psu.edu

Telecommuting Advantages • Increased productivity • Decreased absenteeism • Improved morale • Widens employee pool William H. Bowers – whb108@psu.edu

Telecommuting Advantages • Decreased overhead • Improves resilience through dispersion • Good for the environment through decreased commuting • Employees save money William H. Bowers – whb108@psu.edu

Telecommuting Disadvantages • Threatens control and authority of managers • Decreases or eliminates face to face interaction • Decreased information security • Harder to schedule team meetings William H. Bowers – whb108@psu.edu

Telecommuting Disadvantages • Decreased employee visibility • Decreased contact with off site employees • Isolation of remote employees • Teleworkers work longer hours for the same pay William H. Bowers – whb108@psu.edu

Temporary Work • Modern business environment changes rapidly • Companies once boasted of no layoffs • Currently business environment relies on subcontractors and temporary employees • Workers no longer rely on longevity, but on "knowledge portfolio" William H. Bowers – whb108@psu.edu

Monitoring • Tracking Internet usage • Monitoring telephone usage • Checking email content • Computer file monitoring • Keystroke capturing William H. Bowers – whb108@psu.edu

Monitoring • 25% of UK companies have fired employees for improper Internet usage • A recent study showed that 30 - 40% of office Internet usage is not work related William H. Bowers – whb108@psu.edu

Monitoring • Monitoring can indicate need for training to improve quality or productivity • Can tailor information to a person's location William H. Bowers – whb108@psu.edu

Multinational Teams • Allows for around the clock operations without requiring multiple shifts • Provides diversity and multiple viewpoints William H. Bowers – whb108@psu.edu

Globalization • Worldwide network of businesses and markets • Made possible by decreasing cost of IT William H. Bowers – whb108@psu.edu

Arguments for Globalization • Increases competition • Increases employment in developing countries • Poor countries become more prosperous through exports • Interdependent countries are less likely to go to war with each other William H. Bowers – whb108@psu.edu

Arguments Against Globalization • US should not be subordinate to the WTO • American workers are forced to compete with foreign workers who do not receive fair treatment, such as child laborers William H. Bowers – whb108@psu.edu

Arguments Against Globalization • Causes loss of American jobs • US subsidized businesses, such as farms can operate below cost and undercut foreign farmers unfairly William H. Bowers – whb108@psu.edu

IT Sector Unemployment • 1990's dot-com boom and speculation led to unnatural expansion • Early 2000 the bubble burst • Silicon Valley lost 13% of non agricultural jobs, highest since the Great Depression William H. Bowers – whb108@psu.edu

Foreign Workers in the IT Industry • H1-B visas valid up to six years • Hiring company must certify that no qualified Americans are available • Foreign workers must be paid prevailing wage • Prevalent in IT • Quota reduced to 65,000 for FY 2004 William H. Bowers – whb108@psu.edu

Foreign Workers in the IT Industry • L-1 visas • Allows companies to bring current, foreign employees to US • Does not requirement of prevailing wage William H. Bowers – whb108@psu.edu

The Digital Divide • Disparity between those with technology and Internet access and those who do not • Exists between countries • Social divide is between rich and poor within a country William H. Bowers – whb108@psu.edu

The Digital Divide • Global divide • Poorer countries with little individual wealth • Inadequate telecommunications infrastructure • English language is not prevalent • Low rate of education and literacy • Country's culture does not make it a priority William H. Bowers – whb108@psu.edu

Internet Access by Region William H. Bowers – whb108@psu.edu

Social Divide • Disparity in Internet access within a country • 2000 survey of Internet use • 18 – 29 year olds – 66% • Age 65 and older – 13% • College degree – 74% • High school drop outs – 18% • Whites – 50% • Hispanics – 46% • Blacks – 35% William H. Bowers – whb108@psu.edu

Models of Technological Diffusion • New technology is expensive • Price drops as technology matures • First VHS VCR cost $1,000 in 1977 • Price dropped 98.5% between 1976 and 2003 • Normalization model • Stratification model William H. Bowers – whb108@psu.edu

Critiques of the Term Digital Divide • Promotes the idea of ‘haves’ versus ‘have nots’ as simply one of access • Ireland produces a great deal of IT products • They are not high consumers of IT • 1997 – Ireland’s telecommunications company held a contest to select and fund an “Information Age Town” • Winner was Ennis, a town of 15,000 William H. Bowers – whb108@psu.edu

Critiques of the Term Digital Divide • $22 million prize ($1,200) per resident • Every business was provided with • ISDN line • Web site • Smart-card reader • Every family received • Smart-card • PC William H. Bowers – whb108@psu.edu

Critiques of the Term Digital Divide • 3 years later, most IT was unused • Benefits not fully explained or understood • Formerly, unemployment claims filed in person, which also served social function • After new IT, applications filled online • Many PCs later sold on the black market William H. Bowers – whb108@psu.edu

Critiques of the Term Digital Divide • Social systems must support IT change • “Digital Divide” implies binary division • Access is actually a continuum • “Digital Divide” implies that lack of access is a disadvantage William H. Bowers – whb108@psu.edu

The “Winner-Take-All” Society • The Declaration of Independence declares that “all men are created equal” • We are not equal in society • What if we were all guaranteed the same income? • “From each according to his abilities, to each according to his needs.” William H. Bowers – whb108@psu.edu

The “Winner-Take-All” Society • IT and efficient transport makes it easier for products to dominate world markets • Network economies encourage people to use the same product • English has become the dominate language of business • Business norms have changed William H. Bowers – whb108@psu.edu

Harmful Effects of Winner-Take-All • Increases the gap between rich and poor • Attracts many people to lucrative, but socially unproductive work • Creates wasteful investment and consumption • Competition for elite schools increases • Less well known but good schools suffer William H. Bowers – whb108@psu.edu

Reducing Winner-Take-All Effects • Societies can enact laws limiting business hours • Businesses can form associations with their own rules • Progressive and luxury taxes remove some incentives • Campaign finance reform reduces influence of the wealthy William H. Bowers – whb108@psu.edu

Access to Public Colleges • It is proven that in general more education equates to higher salaries • State’s funding of higher education has decreased since 1980 • Tuition must make up the difference • Tuition rise has outpaced income growth • 63% of Americans believe education should be paid for by students and families William H. Bowers – whb108@psu.edu

Ethical Analysis • Should states make college available to all qualified high school graduates? • Requires state funding of difference between cost and ability to pay William H. Bowers – whb108@psu.edu

Ethics for the Information Age