The rise of precariat

Wan Ahmad Fayhsal Wan Ahmad KamalTuesday, January 3, 2017
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It was a nightmare to many liberals — both in the US and worldwide — to see a controversial figure like Donald Trump winning the presidential election and set to helm the strongest country on earth.

Despite barrage of mudslinging exercises concocted by the mainstream media on the eve of the presidential race, President-elect Trump prevailed and caused a massive upset by clinching the crucial votes from the American public: The middle and working class of the Rust Belt states — the hub where America was known to be a great industrial and manufacturing nation.

Many pollsters and political analysts got it wrong but the signs are already on the horizon for years, to notice the potential social upheaval that led to Trump’s winning. If we could profiled the voters, how best to describe them? Maybe the answer lies in the new social class called “precariat”.

What and who are the precariat?

In the words of British economist, Professor Guy Standing, “precariat” — derived from the word precarious — is a new emerging class in the workforce that experiences constant deprivation, anger, anxiety, and alienation in their work. It has three important labour dimensions that defined such qualities: Relations of production, distribution and state.

In terms of their relation to production, the precariat is in the state of unstable labour ranging from flexible contracts, casual jobs, freelance, parttime and having intermittent employment. All these relations yielded unsecure occupational identity and unclear narrative with regard to their career.

From the viewpoint of distribution relation, the precariat relies solely on money wages devoid of pensions, retrenchment and medical benefits. They are also losing what proletariat usually possessed: The rights-based state benefits based on welfare model. As wages stagnated, the precariat would normally resort to borrow money from the banks or any other informal financial institutions in order to continue living. Such desperation only deepens their problem and exacerbating social inequality further.

With regard to the precariat’s state relation, their mode of living is akin to denizens rather than citizens that have clear civil, cultural, political, social and economic rights. In fact, according to Standing, they are fast becoming supplicants to the state in asking for benefits or services rendered by the bureaucrats.

What separates them from the ordinary working class called the proletariat is that the precariat usually have more education than their job requirement. They are meant to do something related to their knowledge and skills acquired from their educational endeavour, but ended up flipping burgers in the fast-food outlet or becoming informal labour in the gig economy, eg driving Uber.

Precariat and Antiglobalisation Political Tsunami

It is safe to assume that those who voted for Trump and Brexit are largely from the precariat class. They have conservative values in a sense of yearning for the good old days when their countries once prospered with stable jobs and state welfare that are now fast disappearing due to offshoring of jobs and increasing number of immigrants competing in the job market.

For example in the US, The Economist reported the negative impact that North America Free Trade Agreement has on American labours are plain to see: Between 1999 and 2011, America lost, in net terms, about six million manufacturing jobs. Compounded further with the ascension of China into the global trade arena after becoming a member of World Trade Organisation, a research done by David H Autor, David Dorn and Gordon H Hanson concluded that up to 2.4 million jobs in the US may have been lost — either directly or not — due to cheaper imports from China.

All these workers who had lost their jobs due to the factors above are forming the bulk of the Rust Belt voters who resonated their views with Trump’s clarion call to make America great again by bringing jobs back to these former American industrial heartlands.

Among the younger precariat might have different values than the Rust Belt precariat of Trump, but their support for Bernie Sanders who lost to Hillary Clinton in the Democratic Party presidential primaries indicated a similar precariousness with regard to labour and economic issues.

One of the greatest concerns among the younger precariat is their student loan. According to the US official statistic, almost 40 million Americans hold student loans amounting to US$1.2 trillion (RM5.38 trillion). It is the second-highest level of consumer debt after mortgages.

The Occupy Movement that emerged in 2011 was fuelled by such resentment from the younger precariat who are demanding greater accountability and fairer wealth distribution. The movement claimed to represent the 99% of people in their protest against the 1% consisted of the Wall Street bankers and capitalists who are usually blamed for the cyclical economic crisis especially in recent 2008 subprime debacle.

Precariat and Bilderberg

The notion of precariat is not a mere academic discourse neither it is an isolated phenomena occurring only in the West. Its presence among us has even turned the heads of the elites who rule and shape the direction of our global politics and economy.

The 64th Bilderberg Conference, an elite gathering of world leaders, and corporate captains that was held in Dresden, Germany from June 9-12, 2016, had placed the issue of “precariat and the middle class” in this year meeting agenda. Dubbed by some as the “secret Davos” due to the nature of its meeting that is shrouded in secrecy and exclusivity, the conference is a stark contrast to its more flamboyant and illustrious peer from the World Economic Forum.

Bilderberg conference is known to address major issues that shaped the undercurrent of international politics and economy. An annual meeting initiated in 1964, it was designed to foster dialogue between Europe and North America by gathering national leaders, experts from industry, finance, academia and the media to partake in discussing major issues guided by the Chatham House Rule.

The outcome of the conferences was not reported and only recently they issued press release with regard to the conference agenda and its list of participants. With precariat slated in this year Bilderberg agenda, the problem is now being duly acknowledged by the Bilderberg members consisting largely of the top 1% that wields massive influence in our world today.

As world economy remain sluggish and global wealth inequality worsen — as reported by Credit Suisse Global Wealth Report 2016 — the rise of precariat will no longer be confined to the Northern Hemisphere rather it will be contagious to other parts of the world especially among the emerging-market economies as their developmental model are not much different than the developed nations where the precariat was first habituated.

It is high time for every government in Asia to pay closer attention to this emerging class lest the political stability of the nation will be more precarious by each day just like the precariat whom if not managed well will be a political force to be reckoned with as demonstrated in the US and Britain recently.

  • The author is a fellow at Putra Business School, Universiti Putra Malaysia.
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