From the Good Ideas File: Two views of a “Post-Employment Economy”

This article touches on a topic that received some attention in The Local Economy Revolution, but it’s becoming so critical, and so potentially earthshaking, and so little discussed in planning and economic development and local government circles, that I’m starting to work out a new book on the topic.

If you follow business and economic news, you have heard a ton about “jobless recoveries,” “workerless businesses,” the Freelancer Economy, and a whole lot of other catchphrases.  All of these are getting at the same fundamental issue, from different angles: the traditional relationship between employer and employee is decoupling and fragmenting, for a whole range of reasons.  I’m not one who believes that everyone is going to become a tech wizard freelancer working from coffeeshops, but I do think that the assumptions about employment that most of us have grown up with are going to morph into a whole lot of different models, and most of us will move through lots of those fluidly throughout our lives.  And of course, if you deal with tech people, or consultants, or a wide variety of others, you know that’s already happening.

Which leaves a lot of people — both generally, and particularly people who have the job of trying to help their communities adapt to change and find success in the future… really out on a limb.

Which is why I really liked this article.  Plus, I liked how the author framed the big question:

Will a post-employment economy actually suck, or will it wallow in awesomeness? 

 

As you might guess, the answer is yes.  Answer #1 should sound pretty familiar:

View #1: Post-Employment Sucks

In the Atlantic, Conor Sen offers up a quick overview the post-employee economy. One graph from the manufacturing sector pretty much tells the story. Since 1970 production has increased 170% while hours worked has decreased 30%. Businesses can do more work with fewer employees.

And it isn’t just manufacturing — across the board automation and outsourcing are providing the means by which companies can provide their products and services with fewer people on the payroll. This in part accounts for the precipitous drop in participation in the workforce that we’ve seen over the past few years

And while until now these job-destroying forces have mostly been confined to the goods-producing and information sectors, it looks like the next wave is going to hit much broader in the service sector. As nascent technologies like IBM’s Watson show, everyone from bankers to retail workers to health-care and education workers are at risk. “Long IBM, short labor” is a trade that should work for years barring government policy changes.

Fun.  But then there’s view #2, which this author outlines a little more pragmatically and a little less gee-whiz than some of them:

View #2: Post-Employment Wallows in Awesomeness

Da Vinci Institute founder Thomas Frey, writing at the World Future Society blog, describes tremendous opportunity arising from post-employment in a piece entitled Workerless Businesses: An Explosive New Trend. The trick, as Frey sees it, is to turn Sen’s assessment in its head. If productivity gains are accruing to “the owners of the factors of production,” what happens when individuals become the owners?

New technologies and massive de-industrialization have led us to exactly that point. Who needs a job working for a company that’s trying to cut staff when you can be the head of a company yourself, one with significant resources at your disposal and no staff to speak of?

…. The looming question is whether workerless businesses can somehow take up the slack, ultimately providing us much or more work as traditional employers are eliminating. As I noted a while back, this is no small challenge seeing as it is, in some ways, John Henry redux:

Automation is eliminating jobs. Machines are doing it. They are fast, efficient, and relentless. Creating jobs is a whole different matter. Creating jobs requires developing new business models, which means identifying market needs — figuring out what is important to people, what they will pay for. It is a fundamentally creative activity — one that machines can’t perform.

It’s the story of John Henry all over again…but there’s a difference. The same technology that is eliminating jobs also connects us and empowers us in ways unimaginable just a few years ago. Maybe what’s

statue

Statue of John Henry. From Wikipedia

becoming obsolete is not jobs per se, but the idea that they are something that you simply find.

Increasingly, perhaps, a job is something that we each have to create. We can’t count on someone else to create one for us. That model is disappearing. We have to carve something out for ourselves, something that the machines won’t immediately grab. [emphasis mine]

I think that’s a good sum-up of the basic proposition.  And I agree: I think the answer will be yes.  I’ve seen over and over that people aren’t necessarily hard-wired to pivot the way the emerging economy seems to expect, and we have a good number of John Henrys in the making.   The author sums up the conflict these folks are facing very well:

The rub for a lot of folks is that this is not the deal they thought they were getting. The old deal was go to school, find a job, work it. Maybe once or twice you trade up for a better job, but basically there’s always a job there. Jobs are supposed to go on for years and years. They are supposed to be safe, secure, permanent. The gig economy is anything but that, and running an empire of one involves constant uncertainty.

We can’t underestimate that, and we can’t pooh-pooh it.  What we are going to have to do is figure out how we can help people make that change.

But fighting for the reinstatement of that “deal” is a fistfight with a hurricane.  Or John Henry killing himself to beat the machine, which then rolls past him to take over the industry.

 

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