E. F. Schumacher spent twenty years as an economist at Britain’s National Coal Board before publishing Small Is Beautiful. That career does not quite match the image his title may suggest. As the coal industry declined, his responsibilities included improving efficiency and advancing mechanization. Large mining machines really could ease the miners’ punishing physical labour. Meanwhile, he was criticizing industrial society and promoting technologies better suited to conditions in developing countries. He pursued both kinds of work for years.
This history leaves a question that an introduction to his criticism should not brush aside. If machinery could relieve people of exhausting work, what troubled him about it? Nostalgia for handcraft is not a sufficient explanation. Published in 1973, Small Is Beautiful collects essays on a range of subjects. Its chapter on Buddhist economics offers a particularly useful way into what he thought work was for.
Schumacher begins with a familiar account: employers regard labour as a cost, workers regard work as a burden, and wages compensate for the trouble. He thinks this leaves too much out. People also acquire abilities through working and learn to cooperate with others. Remove those possibilities, and work becomes little more than hardship exchanged for pay. Naturally, doing less of it then looks desirable. But we still need to ask how a job came to offer so little beyond an income.
He borrows an example from carpet weaving. Handweaving also uses a loom, but one that holds the warp threads while the craftsperson does the weaving. A power loom takes over work that previously called on the weaver’s skill. The distinction that matters to Schumacher is between a tool that helps someone exercise an ability and machinery that can make the ability redundant.
Yet valuing a craft does not entitle us to decide which working life its practitioner should prefer. A weaver may love the craft, or may have had enough of years of repetitive labour. We need to hear from the person concerned. What happens after the machine arrives? Can the displaced worker learn and do something else, or does the change end with a dismissal notice? An account of the benefits of technology has to include the life that follows.
The extra harvest
In a 1976 interview, Schumacher told a story that takes the question beyond the workplace. People providing aid to a village taught improved cultivation methods, and the harvest increased. When they returned the following year, output had fallen back to its previous level. They assumed the villagers had forgotten what they had learned. In Schumacher’s account, the problem lay beyond the fields: selling the additional produce required women to carry more of it in baskets on their heads over a long distance to market. The villagers did not object to a larger harvest. They could not bear the additional transport work.
The aid workers were assessing a farming technique. The villagers had to consider what its success meant for the household. More produce in the fields meant more to carry on the road. Whether the extra income justified that effort was a question for the people who would have to do the extra work. Output mattered, but increasing it did not finish the job. Schumacher went on to discuss the difficulties of making wheels locally and how people might obtain transport they could make and use themselves. Once the problem became that concrete, dismissing the villagers as resistant to progress was no longer much of an answer.
His proposal for intermediate technology is concerned with this ability to put a technique to use. The name can suggest a compromise somewhere between advanced and backward. In his 1965 account of the proposal, however, the starting point was employment. In places short of capital and in need of many livelihoods, equipment had to be affordable and methods learnable. Ordinary people should not have to wait for an entire expensive supporting infrastructure before they could participate in production. A useful technology would improve on inefficient methods without costing so much that most people could never use it.
On those terms, comparing a small workshop with a large factory involves more than the price of each item produced. Who repairs the equipment? Where do materials come from? Can people nearby learn to operate it? These conditions help determine whether a livelihood can last. Completing a factory does not by itself give local people the means to develop. Conversely, modest tools that people can afford and maintain may allow them to build on abilities they already possess.
There were objections at the time. At a development conference in 1964, the economist Nicholas Kaldor worried that intermediate technology might waste equally scarce capital on uncompetitive products. Some participants from India and Africa also wanted the most advanced technology. Those objections belong in the story. People lacking jobs may lack money too. Creating more positions is not enough if the work cannot improve their lives. Schumacher’s response required design, research, and practical testing of which methods would be economical. Calling a proposal small did not excuse it from having to demonstrate its worth.
This year’s income, the next generation’s capital
For the villagers, the burden of carrying produce was a cost that an account of higher yields could miss. At the beginning of his book, Schumacher looks further ahead and asks what else industrial production leaves out of its calculations. Coal, the material he knew professionally, makes the question easy to grasp.
Extracting and selling coal brings in money, while leaving less coal underground. Schumacher draws on the distinction between capital and income: consuming an existing stock is not the same as earning a return that can continue. What nature provides does not become inexhaustible because nobody sends a bill for it. He is concerned not only with mineral depletion but also with the limits of the environment’s capacity to absorb pollution.
The argument does not require denying the benefits of using resources. Energy helps people build, travel, and improve their lives. Those gains are real. An account of what we obtain now, however, does not establish how long that production can continue. Presenting only the year’s earnings can pass the consequences of depletion into an indefinite future, where some other people or invention are expected to deal with them.
Restraint, understood this way, is more than a taste for an austere personal life. Before expanding production, we need to explain which needs it will meet and who will bear its costs. People without enough food or clothing have compelling reasons to want more. For people who already have plenty, further acquisition may not be the only way to live better. One instruction to consume less cannot fairly govern both circumstances. If concern for people is to guide these proposals, it must make room for the difference.
Who owns the company?
Neither careful consumers nor restrained managers can, on their own, change the way a company is governed. Workers may recognize that a decision will hurt them and still lack the power to challenge it. The discussion of labour therefore leads inside the enterprise: who decides how work is organized, and what happens to the money it earns?
Small Is Beautiful discusses Scott Bader, a British chemical manufacturer producing synthetic resins and other materials. This was no handcraft workshop sheltered from modern industry. In 1951, the Bader family transferred ninety per cent of its shares to the Scott Bader Commonwealth; the remaining shares followed in 1963. The Commonwealth owns the company, and employees can join it as members. The point was not to distribute parcels of shares that individuals could sell, but to give people who worked together a way to participate in governing the business.
Extracts from the 1963 constitution preserved in Britain’s Quaker faith & practice specify members’ say over the allocation of surplus and the raising of new capital. They also require the enterprise to use its resources to benefit people outside the organization. This goes beyond announcing concern for employees. Workers should have some part in deciding where money goes, not only a chance to receive some of it. Responsibility to others also enters the constitution, rather than remaining wholly dependent on a manager’s next decision.
The significance is not simply the founder’s generosity. If the story ends by praising a good employer, the remedy remains an appeal to character. Something more durable was attempted when the family surrendered powers it had previously held. Whether the arrangement would continue to serve its purposes now depended in part on the rules of the Commonwealth and on members’ ability to use their rights—not only on the hope that the next owner would be equally kind.
Smallness then acquires a meaning more demanding than headcount. A business with a dozen employees may still be governed entirely by one person. Employees knowing one another does not mean they feel free to disagree with the boss. A smaller scale can make some things easier to see; it cannot ensure justice. Nor does Schumacher simply propose breaking up every large organization. He also considers how smaller units can retain autonomy within them. Shared affairs require coordination, while the people doing particular jobs need room to judge and adjust.
Difficult questions remain. How should disagreements be settled? What responsibilities should members bear? How should losses be shared when business goes badly? No single company’s experiment answers these questions permanently. It does, however, help give substance to the demand for dignity at work. That dignity concerns more than a supervisor’s manner. It also concerns whether someone affected by a decision can participate, question it, or ask for it to be reconsidered.
Smallness cannot choose for us
The same concern can be turned back on Schumacher. His picture of a modest, ordered life has real appeal: people possess useful skills, earn a living somewhere familiar, and look after one another. But a familiar life will not suit everyone. Some want to stay; others want to leave. Some want to practise an inherited occupation; others want to learn something their home town has never offered. A community that makes room only for the first group has not yet shown equal concern for all its members.
Buddhist economics contains a particularly difficult contradiction. Schumacher values work for developing people’s abilities, yet treats employment outside the home as generally unnecessary for women and large numbers of women entering offices and factories as evidence of economic failure. Dismissing this as a conservative opinion of its time would leave the problem intact. The life he values already assigns women their work, without giving their own wishes comparable attention.
If work can help people learn and take part in shared affairs, those opportunities should not be allocated in advance by sex. Care within a household deserves respect; so does seeking an occupation beyond it. The objection is to one kind of life preventing another, not a demand that everyone prove independence in exactly the same way. Asking this of Schumacher extends his concern for people to a place where his own account fails to carry it.
Read in this spirit, Small Is Beautiful remains open to argument. By putting labour, resources, and the organization of enterprises into the same book, it makes it harder to announce an improvement in life on the strength of one attractive number.
Return to the mine. We need not romanticize exhausting labour, and we need not stop asking questions once a machine has relieved it. Workers’ income, their chances to learn and help make decisions, and the possibility of another livelihood after leaving the mine all belong in the account of change. Schumacher brings these questions back into economics. For the answers, we still need to listen to the miners themselves.