Service Event Horizon

I read a newspaper editorial yesterday that I think was meant to cheer me up over the state of the economy. It didn’t.

It was the bit that followed an intro about the tumult in the eurozone, with the euro falling, increased borrowing by the French and £41 billion in new bad loans in Spain. It read:

“Yet, in Britain, came the positive news that the service sector, which accounts for more than 70 per cent of our entire economic output, grew in December at its fastest rate for six months.”

Am I alone in being depressed by this news? I knew that manufacturing and heavy industry have all but disappeared, but have we really allowed ourselves to become a nation that simply ‘services’ each other?

What happens when we become wholly reliant on service industries? And is ‘industry’ the right word to use anyway?

It will mean that people will earn their living by selling services to others who also work in the ‘industry’ so they in turn can spend their wages on services bought from the people they’re just sold services to.

That doesn’t sound like a healthy or sustainable economy to me.

It reminds me of the Shoe Event Horizon theory described by the prescient Douglas Adams in Hitchhiker’s Guide to the Galaxy. It goes something like this:

Depressed people tend to look down and when they do, they see their shoes. They buy new shoes to try to cheer themselves up, so in a generally depressed society, the demand for shoes will grow.

The demand for shoes rises faster than the capacity to make good quality footwear and as the manufacturing quality decreases, shoes wear out faster and need to be replaced more often, further increasing demand.

Retailers respond to this demand by switching to cheap, mass-produced shoes causing quality to fall even more. The result is an irreversible spiral of increasing shoe demand and decreasing shoe quality.

Eventually, this destabilizes the economy to the point where it is “no longer economically viable to build anything other than shoe shops”, and society collapses.

If this sounds ludicrous, think Primark, Deichmann and Matalan. Or even the clothing and footwear sections of Asda, Tesco et al.

Doesn’t it sound like the ‘service industry’ society we’re heading towards’?

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4 comments… Add yours
  • rhymeswithplague 7th January 2012

    In cattle and horse ranching, “service” has an entirely different meaning.

  • Mr Parrot 7th January 2012

    It has the same meaning in the UK, Mr Plague ;o)

  • Jennyta 7th January 2012

    Yep! We’re not even just a nation of shopkeepers any more. Very depressing.

  • Jan James 8th January 2012

    It’s amazing how creative people are at creating new ways to service each other. “I’ll stick pins in your back (acupuncture) in trade for you trimming my toenails (pedicure).” All you have to do is invent a service, then convince everyone else that they need it. It’s phony, though, and as you pointed out it can come crashing down in a day when people decide they can take an aspirin for pain and cut their own toenails. And it must make us even more absurd to people in third world countries. Oh. Wait. A lot of them work in the service industries.


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