1. © 2012 The McGraw-Hill Companies, Inc. All rights reserved. Slide 1 Richard T. Schaefer

2. Slide 2 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. The Economy and Work Economic Systems Case Study: Capitalism in China Work and Alienation The Changing Economy Social Policy and the Economy: Microfinancing 18

3. Slide 3 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. █ What makes work satisfying? A Look Ahead █ How have the trends toward deindustrialization changed the work people do? █ What will the workforce of the 21 st century look like?

4. Slide 4 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. The Economy and Work █ Fair trade: consumers voluntarily pay above-market prices for certain foods so that workers higher wages –Cultural relativism: viewing foreign workers and factory owners from the perspective of their own cultures █ Economic system: Social institution through which goods and services are produced, distributed, and consumed

5. Slide 5 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. Economic Systems █ Industrial society: Society that depends on mechanization to produce its goods and services –Capitalism –Socialism

6. Slide 6 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. Capitalism █ Capitalism: Economic system in which means of production are held largely in private hands –Main incentive for economic activity is accumulation of profits –Laissez-faire: Businesses compete with minimal government intervention –Monopoly: Exists when a single firm controls the market

7. Slide 7 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. Socialism █ Socialism: Means of production and distribution owned collectively rather than privately owned –Communism: Economic system under which all property is communally owned and no social distinctions are made on the basis of people’s ability to produce

8. Slide 8 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. The Informal Economy █ Informal economy: Transfer of money, goods, or services is not reported to the government –In U.S., about 8% of economic activity In developing nations, informal economy represents significant part of total economic activity

9. Slide 9 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. Sociology in the Global Community █ 18-1: Working Women in Nepal –In your own family, is “women’s work” taken for granted? Have you ever tried to figure out what it would cost your family to pay for all the unpaid work women do? –Why is recognizing women’s work important? How might life change if the true economic value of women’s work were recognized?

10. Slide 10 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. Table 18-1: Characteristics of the Three Major Economic Systems Note: Countries listed in column 3 are typical of one of the three economic systems, but not perfectly so. In practice, the economies of most countries include a mix of elements from the three major systems.

11. Slide 11 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. Case Study: Capitalism in China █ China expected to become the world’s largest economy by 2020 –Chinese more interested in acquiring latest consumer goods –Communist Party officials’ decision to open China’s economy to capitalism reduced once omnipotent institution’s influence

12. Slide 12 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. The Road to Capitalism █ Communist party assumed control of China in 1949, outlawing profit-making –By 1960s, China’s economy dominated by state-controlled enterprises –In 1980s government eased restrictions on private enterprise –By mid-1990s party officials began to give businesses to private entrepreneurs

13. Slide 13 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. The Chinese Economy Today █ Growing free-market economy brought significant inequality to Chinese workers █ Chinese capitalists now have to compete with multinational corporations In 2006, GM’s Chinese operation was producing 6 million automobiles a year at a higher profit than in U.S.

14. Slide 14 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. Chinese Workers in the New Economy █ Loosening state control led to rise in job mobility, increased opportunity, and prosperity for family-owned businesses –Struggles include a lag between urban and rural salaries and worker safety –Many middle-aged urban workers lost jobs to rural migrants seeking higher wages –Serious social problems have accompanied China’s massive economic growth

15. Slide 15 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. Figure 18-1: World’s Largest Economies, 2007 Note: 2009 data standardized in terms of estimated purchasing power parity to eliminate differences in buying power. Sources: World Bank 2007:194–196; 2011.

16. Slide 16 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. Work and Alienation █ Pioneers of sociological thought concerned about negative impact of industrialism on workers █ Durkheim argued individuals experience anomie, or loss of direction as labor becomes more differentiated

17. Slide 17 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. Marx’s View █ Marx believed industrialized advances within capitalist societies cost workers meaningful relationships with their work –Alienation: condition of estrangement or disassociation from surrounding society Marx said workers needed greater control over workplace and products of their labor By 1980s, term burnout increasingly used to describe stress experienced by workers, including professionals

18. Slide 18 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. Worker Satisfaction █ People with greater responsibility for finished product experience more satisfaction █ Factors in Job Satisfaction –Higher wages –Shorter work week –Positive relationships with co-workers Ritzer: relatively positive impression given by many workers is misleading; manual laborers have little job satisfaction

19. Slide 19 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. The Changing Face of the Workforce █ U.S. workforce is constantly changing –Sociologists and labor specialists foresee workforce increasingly composed of women and racial and ethnic minorities 52% of new workers expected to be women from 1988 to 2018 –More diverse workforce means relationships between workers are more likely to cross gender, racial, and ethnic lines

20. Slide 20 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. Deindustrialization █ Deindustrialization: systematic, widespread withdrawal of investment in basic aspects of productivity –Can take the form of corporate restructuring –Downsizing: reductions in a company’s workforce as part of deindustrialization –Social costs cannot be overemphasized

21. Slide 21 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. Research Today █ 18-2: Affirmative Action –Is affirmative action part of the admissions policy at the college or university you attend? Do you think the policy has helped level the playing field? –Take a poll of your classmates. What percentage of the class supports affirmative action in hiring and college admissions?

22. Slide 22 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. Offshoring █ Offshoring: transferring types of work to foreign contractors –Offshoring improves the efficiency of business operations, so it is functional to society. –Also increases economic interdependence in the production of goods and services –Impact on workers at home is severe

23. Slide 23 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. Global Offshoring █ The Setting –U.S. companies have outsourced certain types of work for generations –Offshoring began when U.S. companies transferred manufacturing to foreign factories –The trend includes jobs that require considerable training: accounting and financial analysis, computer programming, claims adjustment, telemarketing, and hotel and airline reservations

24. Slide 24 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. Table 18-2: Occupations Most Vulnerable to Offshoring Sources: Bureau of Labor Statistics data cited in Hira 2008; Moncarz et al. 2008.

25. Slide 25 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. Microfinancing █ Looking at the Issue –Microfinancing: lending small sums of money to the poor so they can work their way out of poverty –Brainchild of Bangladeshi economist Muhammad Yunus –2011 estimates: microfinancing reaching 91 million people in 100 countries –Some critics charge some lenders are taking advantage of the poor

26. Slide 26 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. Microfinancing █ Applying Sociology –Interactionists: poor people can significantly improve their circumstances through mutual support (Collins) –Feminists interested because 90% of recipients of microcredit are women –Critics: creation of small home-based industries reduces demand for formal employment opportunities

27. Slide 27 © 2012 The McGraw-Hill Companies, Inc. All rights reserved. Microfinancing █ Initiating Policy –Need to reduce overlending and monitor success of borrowers escaping poverty –Lenders need to work with political leaders to ensure that they do not regard one another as competitors for political support