Changes and challengies facing the new work UNIAPAC

Summary:

1. Analysis of present situation
   1. Introduction
   2. Unemployment
   3. Robotics
   4. Increase of life expectancy
   5. Loss of Welfare State notion
   6. Illicit activity spreading
   7. Government-citizens Relationship
   8. Consumerism and need induction
2. Social costs
   1. Concept of True cost for goods
   2. Concept of social cost for business strategies
   3. Relational social costs
3. Hints on future out-look
   1. New occupations
   2. Business Welfare/CSR
4. A new business model
   1. Ecological -economy or economy of Common Good
   2. Leadership
   3. A new way to prepare the Balance Sheet
   4. The compassionate companyAnalysis of present situation

• Unemployment

In Italy, the unemployment rate is at 11,5%. This level has slightly reduced in respect of the peaks of years 2013 and 2014, but it will be very difficult to return to the Italian physiological rates of 4-5%.

On the other side, the ILO – International Labour Organization – in its recent global report has estimated an increase of the number of unemployed in 2016 and 2017, even if with a substantial settling of the rate at 5,8%. Globally, this means about 200 million unemployed. (http://www.ilo.org/global/research7global-reports7weso720167WCMA_443480/lang–en/index.htm)
We are therefore facing a structural crisis of the economical model which does not seem to withdraw; unfortunately, moreover it is suffering the effect of population growth.

• Robotics

The latest estimates of World Economic Forum forecast a reduction of workforce globally of 5 million employed, not only due to robotics but with a significant contribution of it.(http://www3.weforum.org/docs/Media/WEF_Future_of_Jobs_embargoed.pdf)
This represents however a temporary effect, since the unavoidable technological progress opens at the same time the way to new professions, services and initiatives.

• Increase of life expectancy

In a recent research published on Lancet magazine (December 2012), which has involved 700 worldwide researchers coordinated by Washington University (http://thelancet.com/pdfs/journals/lancet/PIIS0140-6736(12)61690-0.pdf) the following results have been highlighted:

“In 2010 the global healthy life expectancy at birth was of 59,0 years for men and 63,2 for women, compared to respectively 54,8 and 58,7 in 1990. The difference between life expectancy and healthy life expectancy was of 8,5 years for male population and 10,0 years for female population. Although life expectancy at birth has increased between 1990 and 2010 of 4,7 years for males and 5,1 years for women, the healthy life expectancy has grown of only 4,2 years and 4,5 years respectively, showing that the worldwide population is loosing in disability a greater number of healthy years than twenty years before. Although women keep losing more years in disability than men, in general the gap between genders both in life expectancy and in healthy life expectancy keeps enhancing, because the increases for women have been greater in both cases.”

The research, which includes 187 countries, even if mostly addressed to the analysis of causes of death rate and the trend of some of these (cardiovascular illnesses and infectious diseases are reducing; Alzheimer’s and diabetes’ deaths are increasing), supplied some significant information for economy: the continuous rise in life expectancy with a relatively lower growth in healthy life expectancy involves a greater request of medical assistance though with lower public funds.

• Loss of Welfare State notion

An expensive and broaden welfare is no longer sustainable because the possibility to finance it is progressively eroding, due to taxation on middle classes, which are progressively earning lower incomes. The end of European middle class corresponds to the period in which Nations can no longer assume to use taxation to rise wealth: on one side the population count is reducing, on the other the traditional welfare structure shows the necessity of being updated.
Logically not only the social framework of western Nations is changing but also the mechanism of social protection is becoming critical.
Furthermore, western companies are facing difficulties in providing labour protection to their own workers and at the same time are competing with emerging and developing countries’ competitors that do not undergo these costs. In addition to this, the low yield of stock market is causing difficulties to health insurance companies that have to reduce their offer causing problems especially in those systems based on them.
Poverty has also been considered a high risk factor for both organic and mental health of entire populations.

• Illicit activity spreading

It is worth to briefly highlight this aspect that, in the case of Italy, is contributing to spread a deep sense of discouragement in citizens and a low drive to change. Italy is rated at 69^th place in the Corruption Perception Index with a score of 42 on a scale between 1 and 100.

• Government-citizens Relationship

Still referring to Italy, the parting between citizens and political world/bureaucracy keeps broadening.
An alarming and important electoral fragmentation and a reduction in participation have distinguished the latest political elections, accompanied and ensued in the following months by a non-recognition and a rejection of political parties and their representatives, strongly supported until a short time before.
Dissolution of town councils are more and more frequent, due also to criminal associations, and the discovering of illegal cases in public administration seems to be endless.
All this is not contributing to create an atmosphere of general trustworthiness to convince companies in launching new economic challenges: a sense of egoism and desperate necessity to preserve own interests are predominant.

• Consumerism and push for craving

Advertisement is inducing us, by transmitting images of perfect but unrealistic lives, to consume more and more unneeded products. Moreover it is not only focusing on selling products but it is promoting dreams, lifestyles to pursue or imitate, failing which it’s leaving a painful exclusion or inadequate feeling.
On their side, economists ensure us that only through an increasing consumption we will build a solid and winning economy.  The goods, which once could be repaired if broken, are today being replaced because economically more convenient.
Consumerism might be a phenomenon inherent in the mature development of western civilization, being it so sceptical, individualistic, and deprived of ideals and certainties.
Neuroscience has demonstrated that a person feeling linked to compassion, solidarity, connection, i.e. a pro-social feeling, is activating the same cerebral areas that are tackled during the purchase of a desired good or, most generally, in a situation of pleasure.
It is not so much the acquisition/piling up of extrinsic goods, as much as the self-motivation as an intrinsic good, that establishes a more long lasting well-being feeling.

2. Social costs

• Concept of True Costs for goods

Two examples are taken into consideration: food and clothing.
Examining the food case, Food Tank NGO, which has a variety of partnerships with associations, United Nations and companies, has issued a survey through a recent publication “The real cost of Food”.
The report shows how food can have, on a large scale and long-term period, a negative impact, the cost of which is not supported neither by farmers nor by consumers, but rather by the whole society. This impact is not immediately visible and it may be difficult to appreciate the negative potentiality. For example, an average consumer would not recognize the link between the bargain of a cheap chicken and the conditions of workers in poultry industry, rather than the environmental impact of the avicultural production or the increasing predominance of antibiotics resistance caused by the massive use of them in avicultural breeding.

It is not so simple to calculate the social cost of these aspects, but the report of Food Tank identifies some impressive figures:

• Overweight and obesity cost globally 2 trillion Dollar in sanitary costs;
• USA farmers benefits and assurances cost 20 billion Dollars to taxpayers;
• Subsidies in UE cost 58 billion Euro
• Resistance to antibiotics costs 10 billion Pound sterling in UK and 55 billion Dollars in US;
• Chemical substances present in pesticides which are dangerous to the endocrine system cost 157 billions Euros to UE
• The low salaries paid by companies such as McDonald’s cost 153 billion Dollars to American taxpayers for government assistance programs.

In case of clothing, it is worth mentioning two cases:

• The documentary “The true cost”, which was inspired by the collapse of the Rana Plaza production centre at Dhaka in Bangladesh on 24^th April 2013, and which opened our eyes on the background of the 10 Euro T-shirts we are used to buy regularly. 1133 textile workers perished and 2500 were injured during this slaughter, and they were only guilty of sewing clothes of very well-known brands, which we wear daily, for 14 hours a day with a 23 euro monthly wage.
• The book Made in Italy – the unknown side of Italian Fashion written by Giò Rosi in which the author (using a nickname), who has been working for years in this field, has seen with his eyes the miserable places where great part of our luxury is produced. And where he witnesses how slavery still exists, in Chinese factories as well as in the heart of old Europe.
• Concept of social cost for business strategies

In the current system each company is free to operate following principles that mainly consider the economic growth goals, while employees have been negotiating for the last century better working conditions. Both sides have though lost the focus on the medium-long term effect the production activity would have caused on social costs. This is evidenced by the increase of family problems and generally speaking by the profound social disruption which has occurred with the rising of the well-being society.

• Relational social costs

The productive model developed in the last century has caused the known scenario of the nuclear family. This event, already intrinsically adverse for the development of future generations has been loaded with the employment of both parents. The new generations have had and keep having only one occasional parental reference presence with severe consequences for the raising of their personality and the development of their capacity to face future stressful situations. Only now, the productive world starts realizing that it is necessary to supply their own employees with an extra-working support and an adequate equilibrium work-family.
It is noteworthy that recent neurophysiology studies highlight that the lack of a parental presence dramatically shows to lead to severe consequences on future generations’ resilience. Actually, a low affection development causes serious problems both on stress dealing and on physical and clinical conditions of those suffering from such conditions: today’s predominant lifestyles do not allow preparing new generations with an adequate capacity of stress handling and of facing difficulties both in social and in professional life.
The costs of mental disorders in Europe are very high. Most recent surveys on psychopathology show that in Europe these are the expenses (in billion Euro): 113.4 on mood disorders;  93.9 psychotic disorders; 65.7 addictions; 74.4 anxiety disorders; 27.3 personality disorders; 21.2 somatoform disorders; 0.8 eating disorders (Olesen et. Al., 2012)
In WHO Action Plan 2013-2020 the following emerged for mental health: the exposition to stressful events in young age is an ascertained risk factor for the onset of mental disorders that could be anticipated. Moreover, vulnerable groups can involve: family members living in poverty, people with chronic illness, babies and children exposed to abuses and neglected, teenagers exposed to drugs, minorities, elderly people, people undergoing human rights discrimination and violation, i.e. lesbians, gays, bisexual or transsexuals, prisoners and people exposed to conflicts, natural disasters or other humanitarian emergencies.

3. Hints on future outlook

• New occupations

In opposition to the lack of traditional jobs, new job types are evolving, which were unimaginable until a few years ago and still today look more like science fiction.

These are some provocative  examples picked out from recent press articles published on this subject:

• space pilot, space tour guide, planet architect
• vertical farmer
• body spare part builder

It would be necessary to focus the attention to the enhancement of all professions, which have the responsibility of human capital, and to future workforce preparation.

In the meantime there is the need to improve all those jobs involving the lifelong people care and a good build-up and support of new generations skills or in other words all the services to individuals and to families, i.e. nurses, social assistants, sanitary and assistance operators. It would be better to focus on professions where personal relationship is important and not replaceable by automation. Presently, investments are not focusing on relationship, being it considered not profitable while it is instead instrumental to organic and mental well-being.

• Business welfare/CSR

The two topics are only apparently different.
In the last few years companies have clearly developed a trend to compensate public deficiencies by introducing policies of Social Responsibility and Business Welfare.
It is still unclear if the aim is really the Common Good or rather it is intended as a promotional goal and an easy way to achieve a mark of good “corporate citizens”.
Incidentally it is worth mentioning the “cause related marketing”, a partnership between a business company and a non-profit organization, having the mission to promote an image, a product, a service, gaining mutual benefits. We are still going round the concept of maximising profit using a socially correct action only as an appearance.

4. A New business model

The model is based on how human beings should develop as the main religions have described, that is a model for the complete man fulfilment in all his talents. Today that model is evidence based, i.e. based on evidence given by neurophysiology about the best developing of human beings. Today it is clear also to economists, but unfortunately not to enterprises, that the motivational reward is adequate only for mechanical jobs, but not for sophisticated and complex behaviours. The present economical system is based on this misunderstanding and this is the point on which, sometimes criminally, true cost is hinged.
The real motivation comes out from the ambition to keep improving ourselves in something important for us, from the drive to pursue what we do and from the necessity to lead our lives.
Cases like Google where people spend 20% of their free time thinking limitlessly or like Wikipedia, which has overtaken Encarta, Microsoft’s encyclopaedia, where a range of technicians and a quantity of billions had been invested, have demonstrated that it is not a reward or a bonus to enhance motivation but it is rather an interior motivation.

• Ecologic economy or economy of Common Good

The capitalistic economy has favoured some values such as profit, shareholders value and, only marginally and recently, stakeholders value. It is therefore a matter of redefining the stakeholder value and broaden its meaning in order for it to become Common Good.
Companies should be measured on how much richness they are capable to produce in terms of support to the community in a wide meaning and not only with directly involved users.
Essentially, companies are no longer to be considered as isolated systems using primary goods and facilities at an apparently low cost, selling their own products on market, but rather as pieces of a more complex system, which should be protected and defended by all the members of the system itself.
The concept must be shared with deep belief by businessmen and this might require some time to develop a change of culture. In the meantime, a rewarding system, e.g. in terms of tax benefits, can be started acknowledging what each company does in favour of society by means of attitudes and initiatives not harmful but pro-active towards Common Good: actions focused on the reduction of social costs. These should be promoted towards not only company’s employees, but rather involving the whole community.
As not all companies will be able to support these expensive extraordinary policies, it is important to identify, as said before, a range of priorities which will consider some factors, such as:

–       measurable behaviour suited to favour, in addition to employees and their families’ well- being,  also the community where they operate

–    recruitment of disabled and disadvantaged (invalid, ex-prisoners, etc.)

–     support to social assistance schemes

…………………………………………………….

as well as other widespread issues, such as:

–     control of sub-suppliers

–     energy saving

–     raw material saving

–     plans for environmental and natural resources protection;

…………………………

There is though a great barrier: visiting the most important multinational companies websites, they all appear as the perfect image of Common Good creators: where’s the trick? The trick might be hidden in the fact that companies mostly promote information that positively affects public opinion but avoid showing their potentially negative behaviour. A control and measurement system of website contents does not exist. Furthermore, companies decide on their own.

• Leadership

Clearly, a deep transformation process is required to all industry leaders and managers who will no longer be tried on their economic results but also on the way their choices and decisions will affect society. New managers will be required to conceptualize new needs in terms of new occupations, new ways of working and most of all a new rationale for complex systems. We are speaking of meta-professions that will design new professions.

• A new way to prepare the Balance Sheet

A confluence between Balance Sheet, as considered until today, and a Sustainability report is considered as a sound hypothesis.
It might be necessary to assign an economic value to the activities connected to a real sustainability, measured with universally valid criteria, removing all activities directly or indirectly related to own business  and which are presented as a social activity.
An example:

Company X wants to establish a plant in town Y and in order to obtain permissions it undertakes the building of a gymnasium. The company will include the gym amongst the social activities, but has somebody verified which production processes will be applied in the new plant and if the company is behaving in a socially correct manner? Or is it more likely that the gymnasium is a further façade activity but a real social interest is not there?

• The compassionate company

A new paradigm change is necessary which allows companies to start considering that the research of production boost is driving to a potential standstill: reducing job demand in favour of automation increase and with machinery replacing human labour also in service industry (consider home banking case), for whom  services and goods will be produced in a future perspective – planning, if most of consumers are not provided with economic funds?
A new model of company is required: the compassionate company supported by compassionate consumers.
Compassionate is not intended as charitable or welfare related, but as a consciousness that the ongoing revolution, disengaging man from the necessity to work, has the obligation to redistribute the acquired wealth to the  benefit of everybody. Not only for a superior sense of justice, but especially because society itself is requiring, for the sake of environmental rationality, well performing members.
If these are not performing well enough, the society, which is a sum of members, will bear the consequences.
Accordingly, it is within the interest of industry leaders to find an earning compensation formula for lost jobs, to allow them to carry on with other activities.
The solutions might be the ones previously expressed in this document but also for example, a limitation of business profits, which can, over a certain threshold, be redistributed to to the society.
According to the press, a petition has been recently launched in France requiring the Government a law which could reduce the gap between the maximum and the minimum salary in a company that now reaches a ratio of up to 240 times: in old Olivetti the statutory rule was that the ratio could not exceed 10 times and in Banca Etica of Padova the ratio cannot exceed 6 times.
The Italian 2016 stability law has introduced the benefit companies concept that follows what has already been established in some American States, while it is not so diffuse in Europe, where only a mild form of Bcorporate is present.
Why not push to the generalization of this form of society which integrates social goals in business model, overcoming philanthropic and charitable aspects but engaging the enterprise itself and its management with a strong commitment, hence making it not dependant from any possible sensitivity of each individual manager? By the way, presently the Benefit Companies are not regulated by any taxation relief.
UCID and UNIAPAC could be the ministers of this new culture and UCID / UNIAPAC managers should be its apostles.

5. Conclusions

All in all, it is strongly requested the capacity of generating and spreading around social capital, by gathering persons ready to engage themselves into economic projects with social impact, as it happened after the publication of the encyclical  Rerum Novarum. Beyond the historical reasons which would justify this kind of initiatives, they will increase the resilience of the whole social fabric. The latter is in fact facing the growing impact of serious phenomena of people alienation and disintegration.
In other words it is important to realize that democracy is needed by the entire society, not only  through the the growth of widespread individual initiatives, but still more through collective initiatives, no matter of their juridical form (either partnership firms, companies, syndicates, cooperatives etc.).
Indeed, the very quick evolution of the society, the huge flows of people between the continents, the presence of not censused companies together with the destruction or  transformation of the existing ones, the technological innovation in itself (outsourcing and  off – shoring) do spread around the feeling that it is nowadays impossible to know the reality in all its shades and trends, thus avoiding any attempt to watch at the society in a structural way, as to ease rational and agreed  choices and decisions.
That is why its development reflects mainly a “journalistic” and short term orientation, based on emotions, which shifts from superficial enthusiasms to pessimistic attitudes, with the consequence, as above pointed out, of not understanding the reality as it is.
Nevertheless by watching carefully at the present social changes (and taking advantage  of the updated new instruments) we would be  allowed not only for less emotional attitudes  (the main objective), but also for catching the opportunity of launching collaborative processes among people, who are nowadays so culturally diversified that it could seem to be a real challenge for them to live, work and interact well together (in fact, the differences in culture, race, social class, religion, professional skills could appear more suitable a dividing factor than a specificity and seed for a social and cultural wealth).
Therefore in addition to the promotion of measures concerning the main mechanisms  related to the society and the economy governance, Christian business leaders should act having in mind the clear objective of putting the economical subjectivity at the centre, together with a strong consciousness of the value of mutual collaboration.
Compassionate and mercy economy does not mean, even etymologically, to be only focused on the needs of  people in difficulty – what is in any case very important -, but it implies to foster partnership  and collaboration processes with people whose value and different perspectives are recognized as really interesting to be caught.
A society in which do coexist, side by side, large economic organizations (in manufacturing, in business control and in finance), millions of artisans, many small and medium enterprises, mutual and cooperative companies, is surely more able to cope with the current dramatic changes, allowing people to live active lives in a safer economic environment as compared to what people could face in a strong centralized model. Indeed the latter may reduce the leadership capabilities of people and the consciousness of their mutual interrelationships, justified by the Christian joy of sharing our brotherhood in Christ towards God. It is thus of the greatest importance to study and support all the possible ways of social capital enrichment and of  a real unit in facing  the threats and opportunities of the social and political scenario.

Dott.ssa Marta Zighetti, psichoterapist and writer
Ing. Gianfrancesco Imperiali di Francavilla, former CEO ABB in Italy, former Member of the Executive Committee of Milan Confederation of Industry (Assolombarda)

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