Category: Labor Economics

Firms Invest in France as Rules “Make It Easier to Hire and Fire”

(p. B1) PARIS — The announcements came in a steady drumbeat. Around 1,300 job cuts at France’s biggest automaker. At least 2,500 at France’s largest supermarket chain. Over 200 sought at a major clothing retailer. And thousands more are on the way.
Just weeks after France’s labor overhaul went into effect, companies are readily taking advantage of new rules that make it easier to hire and fire.
. . .
Perceptions of France, long derided as a difficult place to do business for its onerous labor rules, are changing.
Growth has recently picked up after being stagnant for nearly five years. And there are signs that the changes, a major piece of the president’s economic program, are drawing the interest of investors.
Amazon will open a new distribution center south of Paris this year, creating over 1,000 jobs. Facebook and Google announced Monday they would invest in artificial intelligence development in France. Also Monday, Toyota announced it would invest 300 million euros, or $367 million, to increase capacity at a plant in northern (p. B3) France, creating up to 700 jobs through 2020.
“The complex labor laws have historically been the No. 1 obstacle to the competitiveness and attractiveness of France,” said Olivier Marchal, the chairman of Bain & Company France, a business consulting firm. The changes, together with other business-friendly measures such as a gradual reduction in the corporate tax, have “drastically changed investor perceptions,” he said.

For the full story, see:
LIZ ALDERMAN. “Newfound Freedom … to Fire.” The New York Times (Weds., January 24, 2018): B1 & B3.
(Note: ellipsis in article title, in original; ellipsis between quoted paragraphs, added.)
(Note: the online version of the story has the date JAN. 23, 2018, and has the title “French Companies Have Newfound Freedom … to Fire.”)

Apple Orchard Must Focus on “Placating a Government Regulator”

(p. A1) ALTAMONT, N.Y. — For eight weeks every fall, Indian Ladder Farms, a fifth-generation family operation near Albany, kicks into peak season.
The farm sells homemade apple pies, fresh cider and warm doughnuts. Schoolchildren arrive by the busload to learn about growing apples. And as customers pick fruit from trees, workers fill bins with apples, destined for the farm’s shop and grocery stores.
This fall, amid the rush of commerce — the apple harvest season accounts for about half of Indian Ladder’s annual revenue — federal investigators showed up. They wanted to check the farm’s compliance with migrant labor rules and the Fair Labor Standards Act, which sets pay and other requirements for workers.
Suddenly, the small office staff turned its focus away from making money to placating a government regulator.
The investigators arrived on a Friday in late September and interviewed the farm’s management and a group of laborers from Jamaica, who have special work visas. The investigators hand delivered a notice and said they would be back the following week, when they asked to have 22 types of records available. The request included vehicle registrations, insurance documents and time sheets — reams of paper in all.
Over the next several days, the Ten Eyck family, which owns the farm, along with the staff devoted about 40 hours to serving the investigators, who visited three times before closing the books.
“It is terribly disruptive,” said Peter G. Ten Eyck II, 79, who runs the farm along with a daughter (p. A14) and son. “And the dimension that doesn’t get mentioned is the psychological hit: They are there to find something wrong with you. And then they are going to fine you.”
This is life on the farm — and at businesses of all sorts. With thick rule books laying out food safety procedures, compliance costs in the tens of thousands of dollars and ever-changing standards from the government and industry groups, local produce growers are a textbook example of what many business owners describe as regulatory fatigue.
Over the past five decades, Mr. Ten Eyck said, there has been an unending layering of new rules and regulations on his farm of over 300 acres, as more government agencies have taken an interest in nearly every aspect of growing food, and those agencies already involved have become even more so.
Now, a new rule is going into effect that will significantly expand the oversight of one regulator, the Food and Drug Administration, at the farm.
. . .
Researchers at the Mercatus Center, a conservative-leaning economic think tank at George Mason University, say apple orchards are facing a growing federal regulatory burden. Quantifying that burden is difficult, but using a computer algorithm that analyzes regulations through keyword searches, researchers from the center’s RegData Project estimated the federal regulatory code contains 12,000 restrictions and rules on orchards, up from about 9,500, or an increase of 26 percent, from a decade ago.
Many of those rules apply to other businesses as well, and some restrict the actions of government regulators, not the orchard owners. Using the Mercatus Center data, and screening for such exceptions, The New York Times identified at least 17 federal regulations with about 5,000 restrictions and rules that were relevant to orchards.
. . .
. . . regulation streamlining is a winning message across the political spectrum when it comes to making life easier for small businesses, according to more than 20 interviews with business owners and others in the produce industry.
Industry by industry, small businesses have been lobbying governments — from town health departments to federal cabinet agencies — to simplify rules and eradicate redundancy.
. . .
The grievances relate largely to the sheer amount of time and money that it takes to comply, and what farmers see as a disconnect between them — the rule followers — and the rule makers, who Mr. Ten Eyck describes as “people looking at a computer screen dreaming up stuff.”
“The intentions are not bad,” he said. “It is just that one layer after another gets to be — trying to top the people before them.”

For the full story, see:
STEVE EDER. “One Apple Orchard and 5,000 Government Rules.” The New York Times (Thurs., December 28, 2017): A1 & A14-A15.
(Note: ellipses added.)
(Note: the online version of the story has the date DEC. 27, 2017, and has the title “When Picking Apples on a Farm With 5,000 Rules, Watch Out for the Ladders.”)

“The Transforming Power of the Individual Will”

(p. A10) “These deep transformations have started and will continue with the same force, the same rhythm, the same intensity in 2018,” the French president told his compatriots in his New Year’s Eve greetings a few days before.
Mr. Macron was hinting at the real disruptions he has brought about in French political life — in employment and fiscal policy so far, with other big jolts promised soon. Remarkably in so hidebound a country he is getting away with it.
. . .
Mr. Macron imbibed from his mentor, the late philosopher Paul Ricoeur, a belief in the transforming power of the individual will. As proof, the young president can point to his own quick rise to the top, a stunning success that undergirds many of his pronouncements.
Similarly, the changes he has pushed through so far — like his lightening of the mammoth French labor code, with barely a whimper from the opposition — only buttress the narrative of individual determination, which he now hopes to infuse in his fellow citizens.
It is an unusual position for a French politician, who for generations have emphasized the protective power of the state — and the proof of any success will come only with a significant drop in the stubborn 10-percent jobless rate, elusive so far. But already surveys show higher levels of confidence among business executives than have been seen in many years.

For the full story, see:
ADAM NOSSITER. “French President Opens Year With Scolding for Journalists.” The New York Times (Sat., JAN. 6, 2018): A10.
(Note: ellipsis added.)
(Note: the online version of the story has the date JAN. 5, 2018, and has the title “Macron Opens Year Pulling No Punches With Journalists, or Anyone.”)

Automation Is “About Doing More with the People We’ve Got”

(p. A1) Mr. Persson, 35, sits in front of four computer screens, one displaying the loader he steers as it lifts freshly blasted rock containing silver, zinc and lead. If he were down in the mine shaft operating the loader manually, he would be inhaling dust and exhaust fumes. Instead, he reclines in an office chair while using a joystick to control the machine.
He is cognizant that robots are evolving by the day. Boliden is testing self-driving vehicles to replace truck drivers. But Mr. Persson assumes people will always be needed to keep the machines running. He has faith in the Swedish economic model and its protections against the torment of joblessness.
“I’m not really worried,” he says. “There are so many jobs in this mine that even if this job disappears, they will have another one. The company will take care of us.”
. . .
(p. A8) The Garpenberg mine has been in operation more or less since 1257. More than a decade ago, Boliden teamed up with Ericsson, the Swedish telecommunications company, to put in wireless internet. That has allowed miners to talk to one another to fix problems as they emerge. Miners now carry tablet computers that allow them to keep tabs on production all along the 60 miles of roads running through the mine.
“For us, automation is something good,” says Fredrik Hases, 41, who heads the local union chapter representing technicians. “No one feels like they are taking jobs away. It’s about doing more with the people we’ve got.”

For the full story, see:
PETER S. GOODMAN. “Sweden Adds Human Touch to a Robotic Future.” The New York Times (Thurs., December 28, 2017): A1 & A8.
(Note: ellipsis added.)
(Note: the online version of the story has the date DEC. 27, 2017, and has the title “The Robots Are Coming, and Sweden Is Fine.”)

Is a Michelin Star the Best Metric of Good Food?

(p. A4) MONTCEAU-LES-MINES, France — It is like giving up your Nobel, rejecting your Oscar, pushing back on your Pulitzer: Jérôme Brochot, a renowned and refined chef, decided to turn in his Michelin star.
He is renouncing the uniquely French distinction that separates his restaurant from thousands of others, the lifetime dream of hundreds. But Mr. Brochot’s decision was not a rash one, born of arrogance, ingratitude or spite. Rather, it was for a prosaic, but still important, reason: he could no longer afford it.
. . .
Even in a region famed for its culinary traditions, this declining old mining town deep in lower Burgundy could not sustain a one-star Michelin restaurant. Mr. Brochot, a youthful-looking 46, had gambled on high-end cuisine in a working-class town and lost.
. . .
Already Mr. Brochot’s strategy appears to be working. He has cut his prices and is offering a more down-to-earth cuisine of stews, including the classic blanquette de veau, and serving cod instead of the more expensive sea bass.
It had depressed him deeply, he said, to have to throw away costly bass and turbot, like gold even in France’s street markets, at the end of every sitting because his customers couldn’t afford it. “There was a lot of waste,” he said.
“Since we changed the formula, we’ve gotten a lot more people,” Mr. Brochot said. Above all, the effect has been psychological. “In the heads of people, a one-star, it’s the price,” he said.
On a recent Friday afternoon, most of the tables had diners, including Didier Mathus, the longtime former mayor, a Socialist.
. . .
“Maybe the star scared people,” Mr. Mathus said. “I understand. He’s saying, ‘Don’t be scared to come here.’ Here, it’s simple people, with modest incomes.”

For the full story, see:
ADAM NOSSITER. “Rejected Honor Reflects Hardships of ‘the Other France’.” The New York Times (Thurs., December 28, 2017): A4.
(Note: ellipses added.)
(Note: the online version of the story has the date DEC. 27, 2017, and has the title “Chef Gives Up a Star, Reflecting Hardship of ‘the Other France’.”)

Tax Overhaul “Armageddon”

(p. A19) To travel the liberal byways of social media over recent weeks was to learn that Donald Trump was on the precipice of axing Robert Mueller and was likely to use the days just before Christmas, when we were distracted by eggnog and mistletoe, to lower the blade.
Christmas has come. Christmas has gone. Mueller has not.
To listen to Nancy Pelosi and other Democratic leaders, the tax overhaul that Trump just signed into law is no mere plutocratic folly. It’s “Armageddon” (Pelosi’s actual word). Their opposition is righteous, but how will millions of voters who notice smaller withholdings from their paychecks and more money in their pockets square that seemingly good fortune with such prophecies of doom on a biblical scale?
Some of these Americans may decide that the prophets aren’t to be trusted — and that the president isn’t quite the pestilence they make him out to be.

For the full commentary, see:
Bruni, Frank. “The Dangers Of Trump Delirium.” The New York Times (Weds., December 27, 2017): A19.
(Note: the online version of the commentary has the date DEC. 26, 2017, and has the title “The End of Trump and the End of Days.”)

Some Elevator Operator Jobs Remain

(p. 10) There are 69,381 passenger elevators in this vertically obsessed city, and nearly all of them promise a journey about as exotic and exciting as making toast. You get in, you push a button, the doors open a few seconds later at your destination.
But there remain quite a few machines, manually controlled and chauffeur-driven, where climbing aboard is more like taking a short trip on the Orient Express.
. . .
Most of the elevators are in residential buildings, but a few war horses serve heavy duty in commercial complexes.
Collectively they form a hidden museum of obsolete technology and anachronistic employment, a network of cabinets of wonder staffed round the clock. No one knows how many there are, exactly. The city Department of Buildings offered a list of more than 600, but spot checks indicated that most had gone push-button long ago. On the other hand, officials at Local 32BJ of the Service Employees International Union, to which most doormen and elevator operators belong, said they knew of only one or two.
A non-exhaustive field survey this fall turned up 53 buildings with manual passenger elevators. There are undoubtedly dozens more, but probably not hundreds.
Why they still exist in such relative profusion, when the city is down to its last few seltzer men and its final full-time typewriter repair shop, when replacement parts are no longer made and must be machined by hand, is a question with many answers. But sentiment plays a large part.
. . .
Push-button elevators had actually been around since the 1890s, but were not practical for larger buildings. They were slow. Initially they could make only one stop per trip. Later, they could make multiple stops, but only in the order the buttons were pressed.
It took until 1950 for Otis to perfect a push-button system smart enough to handle the traffic and shifting demands for service over the course of the day in a multi-elevator building. The company’s Autotronic system, Otis boasted in advertisements, “minimizes the human element” and “gives tenants a sprightly feeling of independence.”
The elevator man’s fate was sealed.
Almost.

For the full story, see:
ANDY NEWMAN. “Riding a Time Capsule to Apt. 8G.” The New York Times, First Section (Sun., DEC. 17, 2017): 10.
(Note: ellipses added.)
(Note: the online version of the story has the date DEC. 15, 2017, and has the title “Riding a Time Capsule to Apartment 8G.”)

DeepMind Mastered “Go” Only After It Was Told the Score

(p. C3) To function well outside controlled settings, robots must be able to approximate such human capacities as social intelligence and hand-eye coordination. But how to distill them into code?
“It turns out those things are really hard,” said Cynthia Breazeal, a roboticist at the Massachusetts Institute of Technology’s Media Lab.
. . .
Even today’s state-of-the-art AI has serious practical limits. In a recent paper, for example, researchers at MIT described how their AI software misidentified a 3-D printed turtle as a rifle after the team subtly altered the coloring and lighting for the reptile. The experiment showed the ease of fooling AI and raised safety concerns over its use in real-world applications such as self-driving cars and facial-recognition software.
Current systems also aren’t great at applying what they have learned to new situations. A recent paper by the AI startup Vicarious showed that a proficient Atari-playing AI lost its prowess when researchers moved around familiar features of the game.
. . .
Google’s DeepMind subsidiary used a technique known as reinforcement learning to build software that has repeatedly beat the best human players in Go. While learning the classic Chinese game, the machine got positive feedback for making moves that increased the area it walled off from its competitor. Its quest for a higher score spurred the AI to develop territory-taking tactics until it mastered the game.
The problem is that “the real world doesn’t have a score,” said Brown University roboticist Stefanie Tellex. Engineers need to code into AI programs so-called “reward functions”–mathematical ways of telling a machine it has acted correctly. Beyond the finite scenario of a game, amid the complexity of real-life interactions, it’s difficult to determine what results to reinforce. How, and how often, should engineers reward machines to guide them to perform a certain task? “The reward signal is so important to making these algorithms work,” Dr. Tellex added.
. . .
If a robot needs thousands of examples to learn, “it’s not clear that’s particularly useful,” said Ingmar Posner, the deputy director of the Oxford Robotics Institute in the U.K. “You want that machine to pick up pretty quickly what it’s meant to do.”

For the full commentary, see:
Daniela Hernandez. “‘Can Robots Learn to Improvise?” The Wall Street Journal (Sat., Dec. 16, 2017): C3.
(Note: ellipses added.)
(Note: the online version of the commentary has the date Dec. 15, 2017.)

The paper by the researchers at Vicarious, is:
Kansky, Ken, Tom Silver, David A. Mely, Mohamed Eldawy, Miguel Lázaro-Gredilla, Xinghua Lou, Nimrod Dorfman, Szymon Sidor, Scott Phoenix, and Dileep George. “Schema Networks: Zero-Shot Transfer with a Generative Causal Model of Intuitive Physics.” Manuscript, 2017.

The paper, mentioned above, from the MIT Media Lab, is:
Athalye, Anish, Logan Engstrom, Andrew Ilyas, and Kevin Kwok. “Synthesizing Robust Adversarial Examples.” Working paper, Oct. 30, 2017.

Will Ending Firm Hierarchy Create “a Blissful Business Utopia”?

(p. 18) “The Kingdom of Happiness” doesn’t take place in Silicon Valley per se, but it is definitively about tech culture. Groth follows Tony Hsieh, the creator of Zappos, as he pours $350 million of his personal wealth into downtown Las Vegas with the goal of reinventing the area as . I won’t be giving away the story by pointing out that it doesn’t end well for Hsieh, . . .”
. . .
When she’s sober, Groth documents Hsieh’s attempt to integrate “holacracy” into his organizations, a term that rids a company of hierarchy and titles, and instead creates an all-for-one do-what-you-want mentality. (No, I’m not kidding.) It gave me a panic attack just thinking of working in a place like that.

For the full review, see:
NICK BILTON. “Denting the Universe.” The New York Times Book Review (Sunday, FEB. 19, 2017): 18.
(Note: ellipses added.)
(Note: the online version of the review has the date FEB. 14, 2017, and has the title “Pet Projects of the New Billionaires.”)

The book under review, is:
Groth, Aimee. The Kingdom of Happiness: Inside Tony Hsieh’s Zapponian Utopia. New York: Touchstone, 2017.

Only 5% of Jobs at Risk of Total Automation

(p. B6) About 15% of all hours worked globally could be automated by 2030 using technology that is currently available, McKinsey estimates. The new report builds on McKinsey’s earlier research, published in January [2017], which found that 60% of all occupations could be at least partially automated with current tools, though fewer than 5% are at risk of total automation.
Like prior waves of technological change, the adoption of new tools like machine learning and artificial intelligence will likely create more jobs than it destroys, says the Institute, the think-tank arm of consulting firm McKinsey & Co.

For the full story, see:
Lauren Weber. “Forget Robots: Bad Public Policies Can Kill More Jobs.” The Wall Street Journal (Thurs., Nov. 30, 2017): B6.
(Note: bracketed year added.)
(Note: the online version of the story has the date Nov. 28, 2017, and has the title “Forget Robots: Bad Public Policies Could Be Bigger Job Killers.”)