Capitalism follows a simple logic: firms must constantly raise productivity to generate profits, repay capital, stay competitive, and satisfy investors. But as productivity rises, fewer workers are needed for any given output, pushing unemployment higher and eroding shared prosperity and legitimacy. Social stability is therefore structurally linked to continuous economic growth.

This creates a fundamental asymmetry. Some sectors—like manufacturing—achieve relentless efficiency gains. Others—such as care and education—resist automation because their value is rooted in manual work, attention, and human relationships. Yet wages must rise everywhere to retain workers, causing rising relative costs in sectors that can’t boost productivity (Baumol’s cost disease). The result is widening imbalance and a structural need for redistribution to sustain the care economy.

In early industrial growth, productivity gains created both jobs and profits, fueling broad prosperity. But as efficiency gains accelerated, wages in fast sectors decoupled, while slow sectors faced rising costs and fiscal constraints. Financialisation—through household debt, corporate leverage, and public borrowing—temporarily masked these strains, sustaining consumption but eroding resilience. Today, automation and AI further boost productivity in fast sectors, while demographic shifts intensify care demand in sectors crippled by wage compression and chronic underfunding. Moreover, the “fast economy” aggravates inequality, unemployment, and systemic health problems. The outcome is rising care costs and—when redistribution and debt are under pressure—cuts to social services amid growing need.

The crisis of the slow sector is not a moral or technical failure but a consequence of capitalism’s productivity and profit logic, destabilizing social goods essential for cohesion and dignity. Ecological limits, when framed as external issues, distract from the core problem: an economic system that squeezes shared capacity for care and renewal, vital for both societal resilience and sustainability.

Resolving this paradox is challenging. Redistribution alone can’t replace jobs lost to automation. Automating care diminishes quality and falls short of rising needs. Degrowth proposals face political and economic barriers. A viable solution demands structural #transformation: breaking dependency on growth, redistributing technological gains, curbing financial speculation, and recognizing care, education, and repair as core public goods—not marginal costs—shielded from narrow #productivity goals.

Without a new social contract, the harder the system pushes, the faster it unravels—tearing apart the economic, social, and ecological fabric sustaining its legitimacy. When care labour is displaced or devalued, and mutual responsibility erodes under market logic, even the mightiest engines of progress ultimately undermine their own foundation.

#capitalism #transformation #careeconomy #productivity #socialcontract