ethics for the information age

William H. Bowers – [email protected] H. Bowers – [email protected]

Ethics for theEthics for theInformation AgeInformation Age

Chapter 8 – Work and WealthChapter 8 – Work and Wealth


TopicsTopics

IntroductionIntroduction Automation & UnemploymentAutomation & Unemployment Automation and Job CreationAutomation and Job Creation Working Less, Making MoreWorking Less, Making More Effects of Increase in ProductivityEffects of Increase in Productivity Workplace ChangesWorkplace Changes


TopicsTopics

Telecommuting AdvantagesTelecommuting Advantages Telecommuting DisadvantagesTelecommuting Disadvantages Temporary WorkTemporary Work MonitoringMonitoring Multinational TeamsMultinational Teams IT Sector UnemploymentIT Sector Unemployment


TopicsTopics

Foreign Workers in the IT IndustryForeign Workers in the IT Industry The Digital DivideThe Digital Divide The “Winner-Take-All” SocietyThe “Winner-Take-All” Society Access to Public CollegesAccess to Public Colleges


IntroductionIntroduction

Overseas outsourcingOverseas outsourcing Cost of Indian technical service Cost of Indian technical service

representative about 1/6 of USrepresentative about 1/6 of US Simultaneous overseas telephone Simultaneous overseas telephone

capacity now about 2.5 million capacity now about 2.5 million callscalls


IntroductionIntroduction

Cost savings can be Cost savings can be overestimatedoverestimated

The economy is becoming The economy is becoming globalizedglobalized

Digital divideDigital divide Unequal distribution of benefitsUnequal distribution of benefits


Automation & Automation & UnemploymentUnemployment Job DestructionJob Destruction

– 1979 -1994 43 million US 1979 -1994 43 million US manufacturing jobs lostmanufacturing jobs lost

– 1947 manufacturing jobs were 35% 1947 manufacturing jobs were 35% of US workersof US workers

– 2002 manufacturing jobs accounted 2002 manufacturing jobs accounted for 12% of US workersfor 12% of US workers


Automation & Automation & UnemploymentUnemployment Job DestructionJob Destruction

– Manufacturing output has doubled Manufacturing output has doubled since 1970since 1970

– 1977 – it took 35 person hours to 1977 – it took 35 person hours to produce one automobileproduce one automobile

– 1988 - 19.1 person hours per 1988 - 19.1 person hours per automobileautomobile


Automation & Automation & UnemploymentUnemployment Lost white collar jobsLost white collar jobs

– Secretarial and clerical positions Secretarial and clerical positions disappearingdisappearing

– Circa 1980 pharmacies filled about Circa 1980 pharmacies filled about 8,000 prescriptions per day8,000 prescriptions per day

– Merk-Medco currently fills 8,000 per Merk-Medco currently fills 8,000 per hour through a robotic, web-hour through a robotic, web-accessible pharmacyaccessible pharmacy


Automation & Automation & UnemploymentUnemployment Working harder, making lessWorking harder, making less

– Between 1970 and 1990 average Between 1970 and 1990 average American working hours increased American working hours increased by 163 hours per yearby 163 hours per year

– Downsizing leaves fewer people to Downsizing leaves fewer people to do the same amount of workdo the same amount of work


Automation & Automation & UnemploymentUnemployment Working harder, making lessWorking harder, making less

– Technology allows us to take work Technology allows us to take work with uswith us

– We are coming full circle from We are coming full circle from cottage industries to home or cottage industries to home or partially home workerspartially home workers


Automation and Job Automation and Job CreationCreation While technology eliminates some While technology eliminates some

jobs, it creates othersjobs, it creates others Our economy is shifting from Our economy is shifting from

manufacturing to service and manufacturing to service and informationinformation


Automation & Job CreationAutomation & Job Creation


Service vs. Manufacturing Service vs. Manufacturing JobsJobs


Working Less, Making MoreWorking Less, Making More

Compared to 1900 weCompared to 1900 we Work fewer hoursWork fewer hours Produce moreProduce more Earn moreEarn more Have access to a greater variety of Have access to a greater variety of

jobsjobs


Effects of Increase in Effects of Increase in ProductivityProductivity US productivity doubled between US productivity doubled between

1948 and 19901948 and 1990 We work more hours than in any We work more hours than in any

society at any time in historysociety at any time in history– Mid 4th century Romans had 175 Mid 4th century Romans had 175

public festivals per yearpublic festivals per year


Effects of Increase in Effects of Increase in ProductivityProductivity We work more hours than in any We work more hours than in any

society at any time in historysociety at any time in history– Medieval English holidays totaled 4 Medieval English holidays totaled 4

months per yearmonths per year– Protestant work ethicProtestant work ethic– Time versus possessionsTime versus possessions


Workplace ChangesWorkplace Changes

Technology has changed how we Technology has changed how we workwork

Organizational changesOrganizational changes– Early automation of back office Early automation of back office

procedures such as payroll required no procedures such as payroll required no changeschanges

– Later integration of functions such as Later integration of functions such as sales and inventory helped flatten sales and inventory helped flatten organizationsorganizations


Workplace ChangesWorkplace Changes

Organizational changesOrganizational changes– Information paths are no longer Information paths are no longer

linearlinear– Supply chain automation reduces Supply chain automation reduces

paperwork and the need for people paperwork and the need for people to process itto process it


Telecommuting AdvantagesTelecommuting Advantages

Increased productivityIncreased productivity Decreased absenteeismDecreased absenteeism Improved moraleImproved morale Widens employee poolWidens employee pool


Telecommuting AdvantagesTelecommuting Advantages

Decreased overheadDecreased overhead Improves resilience through Improves resilience through

dispersiondispersion Good for the environment through Good for the environment through

decreased commutingdecreased commuting Employees save moneyEmployees save money


Telecommuting Telecommuting DisadvantagesDisadvantages Threatens control and authority of Threatens control and authority of

managersmanagers Decreases or eliminates face to Decreases or eliminates face to

face interactionface interaction Decreased information securityDecreased information security Harder to schedule team Harder to schedule team

meetingsmeetings


Telecommuting Telecommuting DisadvantagesDisadvantages Decreased employee visibilityDecreased employee visibility Decreased contact with off site Decreased contact with off site

employeesemployees Isolation of remote employeesIsolation of remote employees Teleworkers work longer hours for Teleworkers work longer hours for

the same paythe same pay


Temporary WorkTemporary Work

Modern business environment Modern business environment changes rapidlychanges rapidly

Companies once boasted of no layoffsCompanies once boasted of no layoffs Currently business environment relies Currently business environment relies

on subcontractors and temporary on subcontractors and temporary employeesemployees

Workers no longer rely on longevity, Workers no longer rely on longevity, but on "knowledge portfolio"but on "knowledge portfolio"


MonitoringMonitoring

Tracking Internet usageTracking Internet usage Monitoring telephone usageMonitoring telephone usage Checking email contentChecking email content Computer file monitoringComputer file monitoring Keystroke capturingKeystroke capturing



25% of UK companies have fired 25% of UK companies have fired employees for improper Internet employees for improper Internet usageusage

A recent study showed that 30 - A recent study showed that 30 - 40% of office Internet usage is 40% of office Internet usage is not work relatednot work related



Monitoring can indicate need for Monitoring can indicate need for training to improve quality or training to improve quality or productivityproductivity

Can tailor information to a Can tailor information to a person's locationperson's location


Multinational TeamsMultinational Teams

Allows for around the clock Allows for around the clock operations without requiring operations without requiring multiple shiftsmultiple shifts

Provides diversity and multiple Provides diversity and multiple viewpointsviewpoints


GlobalizationGlobalization

Worldwide network of businesses Worldwide network of businesses and marketsand markets

Made possible by decreasing cost Made possible by decreasing cost of ITof IT


Arguments for GlobalizationArguments for Globalization

Increases competitionIncreases competition Increases employment in Increases employment in

developing countriesdeveloping countries Poor countries become more Poor countries become more

prosperous through exportsprosperous through exports Interdependent countries are less Interdependent countries are less

likely to go to war with each otherlikely to go to war with each other


Arguments Against Arguments Against GlobalizationGlobalization US should not be subordinate to US should not be subordinate to

the WTOthe WTO American workers are forced to American workers are forced to

compete with foreign workers compete with foreign workers who do not receive fair treatment, who do not receive fair treatment, such as child laborerssuch as child laborers


Arguments Against Arguments Against GlobalizationGlobalization Causes loss of American jobsCauses loss of American jobs US subsidized businesses, such as US subsidized businesses, such as

farms can operate below cost and farms can operate below cost and undercut foreign farmers unfairlyundercut foreign farmers unfairly


IT Sector UnemploymentIT Sector Unemployment

1990's dot-com boom and 1990's dot-com boom and speculation led to unnatural speculation led to unnatural expansionexpansion

Early 2000 the bubble burstEarly 2000 the bubble burst Silicon Valley lost 13% of non Silicon Valley lost 13% of non

agricultural jobs, highest since agricultural jobs, highest since the Great Depressionthe Great Depression


Foreign Workers in the IT Foreign Workers in the IT IndustryIndustry H1-B visas valid up to six yearsH1-B visas valid up to six years Hiring company must certify that no Hiring company must certify that no

qualified Americans are availablequalified Americans are available Foreign workers must be paid Foreign workers must be paid

prevailing wageprevailing wage Prevalent in ITPrevalent in IT Quota reduced to 65,000 for FY 2004 Quota reduced to 65,000 for FY 2004


Foreign Workers in the IT Foreign Workers in the IT IndustryIndustry L-1 visasL-1 visas Allows companies to bring Allows companies to bring

current, foreign employees to UScurrent, foreign employees to US Does not requirement of Does not requirement of

prevailing wageprevailing wage


The Digital DivideThe Digital Divide

Disparity between those with Disparity between those with technology and Internet access technology and Internet access and those who do notand those who do not

Exists between countriesExists between countries Social divide is between rich and Social divide is between rich and

poor within a countrypoor within a country


The Digital DivideThe Digital Divide

Global divideGlobal divide– Poorer countries with little individual Poorer countries with little individual

wealthwealth– Inadequate telecommunications Inadequate telecommunications

infrastructureinfrastructure– English language is not prevalentEnglish language is not prevalent– Low rate of education and literacyLow rate of education and literacy– Country's culture does not make it a Country's culture does not make it a

prioritypriority


Internet Access by RegionInternet Access by Region


Social DivideSocial Divide

Disparity in Internet access within a Disparity in Internet access within a countrycountry

2000 survey of Internet use2000 survey of Internet use– 18 – 29 year olds – 66%18 – 29 year olds – 66%– Age 65 and older – 13%Age 65 and older – 13%– College degree – 74%College degree – 74%– High school drop outs – 18%High school drop outs – 18%– Whites – 50%Whites – 50%– Hispanics – 46%Hispanics – 46%– Blacks – 35%Blacks – 35%


Models of Technological Models of Technological DiffusionDiffusion

New technology is expensiveNew technology is expensive Price drops as technology maturesPrice drops as technology matures First VHS VCR cost $1,000 in 1977First VHS VCR cost $1,000 in 1977 Price dropped 98.5% between 1976 Price dropped 98.5% between 1976

and 2003and 2003 Normalization modelNormalization model Stratification modelStratification model


Critiques of the Term Digital Critiques of the Term Digital DivideDivide

Promotes the idea of ‘haves’ versus Promotes the idea of ‘haves’ versus ‘have nots’ as simply one of access‘have nots’ as simply one of access

Ireland produces a great deal of IT Ireland produces a great deal of IT productsproducts

They are not high consumers of ITThey are not high consumers of IT 1997 – Ireland’s telecommunications 1997 – Ireland’s telecommunications

company held a contest to select and company held a contest to select and fund an “Information Age Town”fund an “Information Age Town”

Winner was Ennis, a town of 15,000Winner was Ennis, a town of 15,000



$22 million prize ($1,200) per resident$22 million prize ($1,200) per resident Every business was provided withEvery business was provided with

– ISDN lineISDN line– Web siteWeb site– Smart-card readerSmart-card reader

Every family receivedEvery family received– Smart-cardSmart-card– PCPC



3 years later, most IT was unused3 years later, most IT was unused Benefits not fully explained or Benefits not fully explained or

understoodunderstood Formerly, unemployment claims filed in Formerly, unemployment claims filed in

person, which also served social functionperson, which also served social function After new IT, applications filled onlineAfter new IT, applications filled online Many PCs later sold on the black marketMany PCs later sold on the black market



Social systems must support IT changeSocial systems must support IT change ““Digital Divide” implies binary divisionDigital Divide” implies binary division Access is actually a continuumAccess is actually a continuum ““Digital Divide” implies that lack of Digital Divide” implies that lack of

access is a disadvantageaccess is a disadvantage


The “Winner-Take-All” SocietyThe “Winner-Take-All” Society

The Declaration of Independence The Declaration of Independence declares that “all men are created declares that “all men are created equal”equal”

We are not equal in societyWe are not equal in society What if we were all guaranteed the What if we were all guaranteed the

same income?same income? ““From each according to his abilities, From each according to his abilities,

to each according to his needs.”to each according to his needs.”


The “Winner-Take-All” SocietyThe “Winner-Take-All” Society

IT and efficient transport makes it IT and efficient transport makes it easier for products to dominate world easier for products to dominate world marketsmarkets

Network economies encourage people Network economies encourage people to use the same productto use the same product

English has become the dominate English has become the dominate language of businesslanguage of business

Business norms have changedBusiness norms have changed


Harmful Effects of Winner-Harmful Effects of Winner-Take-AllTake-All

Increases the gap between rich and poorIncreases the gap between rich and poor Attracts many people to lucrative, but Attracts many people to lucrative, but

socially unproductive worksocially unproductive work Creates wasteful investment and Creates wasteful investment and

consumptionconsumption Competition for elite schools increasesCompetition for elite schools increases Less well known but good schools sufferLess well known but good schools suffer


Reducing Winner-Take-All Reducing Winner-Take-All EffectsEffects

Societies can enact laws limiting Societies can enact laws limiting business hoursbusiness hours

Businesses can form associations with Businesses can form associations with their own rulestheir own rules

Progressive and luxury taxes remove Progressive and luxury taxes remove some incentivessome incentives

Campaign finance reform reduces Campaign finance reform reduces influence of the wealthyinfluence of the wealthy


Access to Public CollegesAccess to Public Colleges

It is proven that in general more It is proven that in general more education equates to higher salarieseducation equates to higher salaries

State’s funding of higher education has State’s funding of higher education has decreased since 1980decreased since 1980

Tuition must make up the differenceTuition must make up the difference Tuition rise has outpaced income growthTuition rise has outpaced income growth 63% of Americans believe education 63% of Americans believe education

should be paid for by students and should be paid for by students and familiesfamilies


Ethical AnalysisEthical Analysis

Should states make college available Should states make college available to all qualified high school graduates?to all qualified high school graduates?

Requires state funding of difference Requires state funding of difference between cost and ability to paybetween cost and ability to pay


Utilitarian AnalysisUtilitarian Analysis

Goal of state is universal accessGoal of state is universal access Cost to state may average 50 – 75% of actualCost to state may average 50 – 75% of actual Average college graduate makes $20,000 per Average college graduate makes $20,000 per

year more than a high school graduateyear more than a high school graduate Difference over 35 years is almost $750,000Difference over 35 years is almost $750,000 At a tax rate of 12%, this means $84,000 At a tax rate of 12%, this means $84,000

more in taxes paidmore in taxes paid Graduates less likely to be jailed, Graduates less likely to be jailed,

unemployed, etc.unemployed, etc.


Utilitarian AnalysisUtilitarian Analysis

More graduates can lower the value of More graduates can lower the value of a degreea degree

Other consumers of state resources Other consumers of state resources can not pay their waycan not pay their way

A degree does not guarantee successA degree does not guarantee success


Kantian AnalysisKantian Analysis

Perfect duty is fulfilled in all casesPerfect duty is fulfilled in all cases Imperfect duty is general, but not Imperfect duty is general, but not

applicable in all casesapplicable in all cases Is providing access to higher education Is providing access to higher education

a perfect duty, imperfect duty or a perfect duty, imperfect duty or neither?neither?


Social Contract Theory AnalysisSocial Contract Theory Analysis

Rawl’s second principle of justice states Rawl’s second principle of justice states that inequalities of income and wealth that inequalities of income and wealth must be to everyone’s advantage and must be to everyone’s advantage and all qualified must have equal access to all qualified must have equal access to positions of responsibilitypositions of responsibility

Greater education leads to positions of Greater education leads to positions of greater authoritygreater authority

Children from poorer families have Children from poorer families have unequal access to education, therefore unequal access to education, therefore powerpower


Questions & DiscussionQuestions & Discussion

ethics for the information age

Documents

person hours

manufacturing jobsworking

yearprotestant work

average american working

moreeffects of increase

home workersautomation

job creationworking

yeareffects of increase