Ethics for the
Information Age
Chapter 8 – Work and Wealth
William H. Bowers – whb108@psu.edu
Topics
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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
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Telecommuting Advantages
Telecommuting Disadvantages
Temporary Work
Monitoring
Multinational Teams
IT Sector Unemployment
William H. Bowers – whb108@psu.edu
Topics
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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
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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
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Cost savings can be overestimated
The economy is becoming globalized
Digital divide
Unequal distribution of benefits
William H. Bowers – whb108@psu.edu
Automation & Unemployment
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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
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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
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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
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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
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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
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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
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Compared to 1900 we
Work fewer hours
 Produce more
 Earn more
 Have access to a greater variety of jobs
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William H. Bowers – whb108@psu.edu
Effects of Increase in
Productivity
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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
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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
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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
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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
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Increased productivity
Decreased absenteeism
Improved morale
Widens employee pool
William H. Bowers – whb108@psu.edu
Telecommuting Advantages
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Decreased overhead
Improves resilience through dispersion
Good for the environment through
decreased commuting
Employees save money
William H. Bowers – whb108@psu.edu
Telecommuting Disadvantages
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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
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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
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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
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Tracking Internet usage
Monitoring telephone usage
Checking email content
Computer file monitoring
Keystroke capturing
William H. Bowers – whb108@psu.edu
Monitoring
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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
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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
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Allows for around the clock operations
without requiring multiple shifts
Provides diversity and multiple
viewpoints
William H. Bowers – whb108@psu.edu
Globalization
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Worldwide network of businesses and
markets
Made possible by decreasing cost of IT
William H. Bowers – whb108@psu.edu
Arguments for Globalization
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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
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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
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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
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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
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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
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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
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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
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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
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Disparity in Internet access within a country
2000 survey of Internet use
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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
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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
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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
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$22 million prize ($1,200) per resident
Every business was provided with
– ISDN line
– Web site
– Smart-card reader
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Every family received
– Smart-card
– PC
William H. Bowers – whb108@psu.edu
Critiques of the Term Digital Divide
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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
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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
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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
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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
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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
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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
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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
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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
Utilitarian Analysis
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Goal of state is universal access
Cost to state may average 50 – 75% of actual
Average college graduate makes $20,000 per year
more than a high school graduate
Difference over 35 years is almost $750,000
At a tax rate of 12%, this means $84,000 more in
taxes paid
Graduates less likely to be jailed, unemployed, etc.
William H. Bowers – whb108@psu.edu
Utilitarian Analysis
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More graduates can lower the value of a
degree
Other consumers of state resources can not
pay their way
A degree does not guarantee success
William H. Bowers – whb108@psu.edu
Kantian Analysis
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Perfect duty is fulfilled in all cases
Imperfect duty is general, but not
applicable in all cases
Is providing access to higher education a
perfect duty, imperfect duty or neither?
William H. Bowers – whb108@psu.edu
Social Contract Theory Analysis
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Rawl’s second principle of justice states that
inequalities of income and wealth must be
to everyone’s advantage and all qualified
must have equal access to positions of
responsibility
Greater education leads to positions of
greater authority
Children from poorer families have unequal
access to education, therefore power
William H. Bowers – whb108@psu.edu
Questions & Discussion
William H. Bowers – whb108@psu.edu