Saturday, October 31, 2020

Favoritism

It's a generalization, but overall, the economy of the United States is designed to favor Efficiency over Resilience. There is nothing particularly wrong with this; one is not necessarily better than the other. It has, however, resulted in the overall disparity in labor participation that we see between groups; when the goal is to satisfy demand with as little outlay as possible, keeping the labor force down is seen as a virtue. And in a society that historically had few to no qualms about determining both intrinsic and instrumental value based on appearance, social approval and similar qualities, this resulted in the labor force being noticeably skewed when compared to the population at large, especially in the higher ranks of management, where the returns on education and labor were the highest.

Now that society, or at least some rather vocal sectors of it, have determined that this should be changed, there are voices that wish to sound the alarm about what they see as "reverse" discrimination. (As an aside, I find the concept of "reverse discrimination" to be vapid, implying, as it does, that there is an appropriate direction for an inappropriate practice.) But what is really at work here is an attempt to solve an effect, without dealing with a cause.

For large, mature organizations, altering the demographics of the workforce organically while managing the size of that workforce is going to entail preferential hiring and promotion practices. There's no way around that. Going from, say, 25% of senior managers being women to something closer to 50% is going to mean that men will find senior management difficult to enter unless the pool of senior managers is greatly and rapidly enlarged. And in a society that begrudges "unnecessary" labor participation, that expansion is unlikely to occur unless some remarkable overall economic expansion takes place, and companies need to expand their labor forces rapidly simply to keep up.

This puts businesses in a difficult position. Activists for diversity, inclusion and representation are likely to be aggrieved at what they perceive as foot-dragging on the part of the business community, and the people who find themselves newly shut out of desirable jobs are going to be similarly upset at being blocked from opportunities in favor of those they find less deserving. To be sure, a lot of this is the business community's own doing. An intense and decades-long focus on shareholder value at the expense of all other considerations has siphoned off a lot of the wealth that could be used to fund labor force expansion. The accumulation of wealth in the hands of a relatively small group of people at the top of the food chain has increased the price sensitivity of the majority of people lower down the ladder. This has resulted in an even greater push for Efficiency of production and delivery, and since labor is a large expense, corporations have turned to even more aggressive ways of cutting those costs. And when labor force participation is effectively capped by economic concerns, the quest for employment opportunities, especially desirable ones, becomes a zero-sum competition. (The drive to find ways to unemploy even more people through the use of automation isn't helping.)

The fundamental "problem" with societies is that decision-making doesn't scale up very effectively (when it can be scaled up at all). Casting diversity, inclusion and representation as civic virtues is easy. Deciding that they are civic assets, and therefore worth paying for is vastly more difficult. After all, the entire point behind opportunity hoarding (which is what leads to discrimination in the first place) is the perception that opportunities are scarce, and therefore precious. And in order to make employment less precious, it's going to have to be easier to obtain. And that's going to mean a broader social trend away from an Efficient economy and towards a Resilient one. But there's a reason why the social trend points the other way; unless that can be corrected, opportunity will remain scarce, and contention for them will go unabated.

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