[alsomike]

I read this right after another story I found on HN - The Youth Unemployment Bomb: http://www.businessweek.com/print/magazine/content/07_52/b40...

It's relevant because one of the methods for reducing unemployment was encouraging entrepreneurship. Considering the small chances of startup success, isn't the relationship between Crowdspring client / designers exactly the same as Venture Capitalist / startup founder? Most of the designs are losers, just like most startups. You could even extend this logic to social media participation - lots of people make YouTube videos, a few get huge and earn a share of the advertising dollars, same with blogging.

When there's an oversupply of skilled labor, you can switch to a contest model instead of an employment or contractor model, driving down the costs even more. This problem affects young, relatively well-educated Westerners, and as the Business Week article points out, this is the root of the current political violence in Egypt. Companies trying to find new ways to grow will demand tax cuts, governments will cut benefits to give it to them because they want to see improved unemployment numbers, and this will further enrage the struggling unemployed. If this trend continues, it's a downward spiral that could bring increased political violence in the West.