The Future of Jobs report 2018

[ From the Centre for the New Economy and Society ]

As technological breakthroughs rapidly shift the frontier between the work tasks performed by humans and those performed by machines and algorithms, global labour markets are undergoing major transformations. These transformations, if managed wisely, could lead to a new age of good work, good jobs and improved quality of life for all, but if managed poorly, pose the risk of widening skills gaps, greater inequality and broader polarization.

As the Fourth Industrial Revolution unfolds, companies are seeking to harness new and emerging technologies to reach higher levels of efficiency of production and consumption, expand into new markets, and compete on new products for a global consumer base composed increasingly of digital natives. Yet in order to harness the transformative potential of the Fourth Industrial Revolution, business leaders across all industries and regions will increasingly be called upon to formulate a comprehensive workforce strategy ready to meet the challenges of this new era of accelerating change and innovation.

This report finds that as workforce transformations accelerate, the window of opportunity for proactive management of this change is closing fast and business, government and workers must proactively plan and implement a new vision for the global labor market. The report’s key findings include:

• Drivers of change: Four specific technological advances—ubiquitous high-speed mobile internet; artificial intelligence; widespread adoption of big data analytics; and cloud technology—are set to dominate the 2018–2022 period as drivers positively affecting business growth. They are flanked by a range of socio-economic trends driving business opportunities in tandem with the spread of new technologies, such as national economic growth trajectories; expansion of education and the middle classes, in particular in developing economies; and the move towards a greener global economy through advances in new energy technologies.

• Accelerated technology adoption: By 2022, according to the stated investment intentions of companies surveyed for this report, 85% of respondents are likely or very likely to have expanded their adoption of user and entity big data analytics. Similarly, large proportions of companies are likely or very likely to have expanded their adoption of technologies such as the internet of things and app- and webenabled markets, and to make extensive use of cloud computing. Machine learning and augmented and virtual reality are poised to likewise receive considerable business investment.

• Trends in robotization: While estimated use cases for humanoid robots appear to remain somewhat more limited over the 2018–2022 period under consideration in this report, collectively, a broader range of recent robotics technologies at or near commercialization— including stationary robots, non-humanoid land robots and fully automated aerial drones, in addition to machine learning algorithms and artificial intelligence— are attracting significant business interest in adoption. Robot adoption rates diverge significantly across sectors, with 37% to 23% of companies planning this investment, depending on industry. Companies across all sectors are most likely to adopt the use of stationary robots, in contrast to humanoid, aerial or underwater robots, however leaders in the Oil & Gas industry report the same level of demand for stationary and aerial and underwater robots, while employers in the Financial Services industry are most likely to signal the planned adoption of humanoid robots in the period up to 2022.

• Changing geography of production, distribution and value chains: By 2022, 59% of employers surveyed for this report expect that they will have significantly modified how they produce and distribute by changing the composition of their value chain and nearly half expect to have modified their geographical base of operations. When determining job location decisions, companies overwhelmingly prioritize the availability of skilled local talent as their foremost consideration, with 74% of respondents providing this factor as their key consideration. In contrast, 64% of companies cite labour costs as their main concern. A range of additional relevant factors—such as the flexibility of local labour laws, industry agglomeration effects or proximity of raw materials—were considered of lower importance.

• Changing employment types: Nearly 50% of companies expect that automation will lead to some reduction in their full-time workforce by 2022, based on the job profiles of their employee base today. However, 38% of businesses surveyed expect to extend their workforce to new productivity-enhancing roles, and more than a quarter expect automation to lead to the creation of new roles in their enterprise. In addition, businesses are set to expand their use of contractors doing task-specialized work, with many respondents highlighting their intention to engage workers in a more flexible manner, utilizing remote staffing beyond physical offices and decentralization of operations.

• A new human-machine frontier within existing tasks: Companies expect a significant shift on the frontier between humans and machines when it comes to existing work tasks between 2018 and 2022. In 2018, an average of 71% of total task hours across the 12 industries covered in the report are performed by humans, compared to 29% by machines. By 2022 this average is expected to have shifted to 58% task hours performed by humans and 42% by machines. In 2018, in terms of total working hours, no work task was yet estimated to be predominantly performed by a machine or an algorithm. By 2022, this picture is projected to have somewhat changed, with machines and algorithms on average increasing their contribution to specific tasks by 57%. For example, by 2022, 62% of organization’s information and data processing and information search and transmission tasks will be performed by machines compared to 46% today. Even those work tasks that have thus far remained overwhelmingly human—communicating and interacting (23%); coordinating, developing, managing and advising (20%); as well as reasoning and decisionmaking (18%)—will begin to be automated (30%, 29%, and 27% respectively). Relative to their starting point today, the expansion of machines’ share of work task performance is particularly marked in the reasoning and decision-making, administering, and looking for and receiving job-related information tasks.

• A net positive outlook for jobs: However this finding is tempered by optimistic estimates around emerging tasks and growing jobs which are expected to offset declining jobs. Across all industries, by 2022, growth in emerging professions is set to increase their share of employment from 16% to 27% (11% growth) of the total employee base of company respondents, whereas the employment share of declining roles is set to decrease from currently 31% to 21% (10% decline). About half of today’s core jobs—making up the bulk of employment across industries—will remain stable in the period up to 2022. Within the set of companies surveyed, representing over 15 million workers in total, current estimates would suggest a decline of 0.98 million jobs and a gain of 1.74 million jobs. Extrapolating these trends across those employed by large firms in the global (nonagricultural) workforce, we generate a range of estimates for job churn in the period up to 2022. One set of estimates indicates that 75 million jobs may be displaced by a shift in the division of labour between humans and machines, while 133 million new roles may emerge that are more adapted to the new division of labour between humans, machines and algorithms. While these estimates and the assumptions behind them should be treated with caution, not least because they represent a subset of employment globally, they are useful in highlighting the types of adaptation strategies that must be put in place to facilitate the transition of the workforce to the new world of work. They represent two parallel and interconnected fronts of change in workforce transformations: 1) large-scale decline in some roles as tasks within these roles become automated or redundant, and 2) large-scale growth in new products and services—and associated new tasks and jobs— generated by the adoption of new technologies and other socio-economic developments such as the rise of middle classes in emerging economies and demographic shifts.

• Emerging in-demand roles: Among the range of established roles that are set to experience increasing demand in the period up to 2022 are Data Analysts and Scientists, Software and Applications Developers, and Ecommerce and Social Media Specialists, roles that are significantly based on and enhanced by the use of technology. Also expected to grow are roles that leverage distinctively ‘human' skills, such as Customer Service Workers, Sales and Marketing Professionals, Training and Development, People and Culture, and Organizational Development Specialists as well as Innovation Managers. Moreover, our analysis finds extensive evidence of accelerating demand for a variety of wholly new specialist roles related to understanding and leveraging the latest emerging technologies: AI and Machine Learning Specialists, Big Data Specialists, Process Automation Experts, Information Security Analysts, User Experience and Human-Machine Interaction Designers, Robotics Engineers, and Blockchain Specialists.

• Growing skills instability: Given the wave of new technologies and trends disrupting business models and the changing division of labour between workers and machines transforming current job profiles, the vast majority of employers surveyed for this report expect that, by 2022, the skills required to perform most jobs will have shifted significantly. Global average skills stability—the proportion of core skills required to perform a job that will remain the same—is expected to be about 58%, meaning an average shift of 42% in required workforce skills over the 2018–2022 period.

• A reskilling imperative: By 2022, no less than 54% of all employees will require significant re- and upskilling. Of these, about 35% are expected to require additional training of up to six months, 9% will require reskilling lasting six to 12 months, while 10% will require additional skills training of more than a year. Skills continuing to grow in prominence by 2022 include analytical thinking and innovation as well as active learning and learning strategies. Sharply increasing importance of skills such as technology design and programming highlights the growing demand for various forms of technology competency identified by employers surveyed for this report. Proficiency in new technologies is only one part of the 2022 skills equation, however, as ‘human’ skills such as creativity, originality and initiative, critical thinking, persuasion and negotiation will likewise retain or increase their value, as will attention to detail, resilience, flexibility and complex problem-solving. Emotional intelligence, leadership and social influence as well as service orientation also see an outsized increase in demand relative to their current prominence.

• Current strategies for addressing skills gaps: Companies highlight three future strategies to manage the skills gaps widened by the adoption of new technologies. They expect to hire wholly new permanent staff already possessing skills relevant to new technologies; seek to automate the work tasks concerned completely; and retrain existing employees. The likelihood of hiring new permanent staff with relevant skills is nearly twice the likelihood of strategic redundancies of staff lagging behind in new skills adoption. However, nearly a quarter of companies are undecided or unlikely to pursue the retraining of existing employees, and two-thirds expect workers to adapt and pick up skills in the course of their changing jobs. Between one-half and two-thirds are likely to turn to external contractors, temporary staff and freelancers to address their skills gaps.

• Insufficient reskilling and upskilling: Employers indicate that they are set to prioritize and focus their re- and upskilling efforts on employees currently performing high-value roles as a way of strengthening their enterprise’s strategic capacity, with 54% and 53% of companies, respectively, stating they intend to target employees in key roles and in frontline roles which will be using relevant new technologies. In addition, 41% of employers are set to focus their reskilling provision on high-performing employees while a much smaller proportion of 33% stated that they would prioritize at-risk employees in roles expected to be most affected by technological disruption. In other words, those most in need of reskilling and upskilling are least likely to receive such training.

There are complex feedback loops between new technology, jobs and skills. New technologies can drive business growth, job creation and demand for specialist skills but they can also displace entire roles when certain tasks become obsolete or automated. Skills gaps—both among workers and among the leadership of organizations—can speed up the trends towards automation in some cases but can also pose barriers to the adoption of new technologies and therefore impede business growth.

The findings of this report suggest the need for a comprehensive ‘augmentation strategy’, an approach where businesses look to utilize the automation of some job tasks to complement and enhance their human workforces’ comparative strengths and ultimately to enable and empower employees to extend to their full potential. Rather than narrowly focusing on automation-based labour cost savings, an augmentation strategy takes into account the broader horizon of value-creating activities that can be accomplished by human workers, often in complement to technology, when they are freed of the need to perform routinized, repetitive tasks and better able to use their distinctively human talents.

However, to unlock this positive vision, workers will need to have the appropriate skills enabling them to thrive in the workplace of the future and the ability to continue to retrain throughout their lives. Crafting a sound in-company lifelong learning system, investing in human capital and collaborating with other stakeholders on workforce strategy should thus be key business imperatives, critical to companies’ medium to long-term growth, as well as an important contribution to society and social stability. A mindset of agile learning will also be needed on the part of workers as they shift from the routines and limits of today’s jobs to new, previously unimagined futures. Finally, policy-makers, regulators and educators will need to play a fundamental role in helping those who are displaced repurpose their skills or retrain to acquire new skills and to invest heavily in the development of new agile learners in future workforces by tackling improvements to education and training systems, as well as updating labour policy to match the realities of the Fourth Industrial Revolution.


Christine Haskell, PHD has built her practice on credible, published research and data. In the Research Series, you’ll find highlights, shareable statistics, and links to the full source material.


Apprentices of Siemens USA think like master craftsmen

[ from New America ]

Image Credit: New America

Image Credit: New America

Apprenticeship Program Profile: Siemens Charlotte

In 2011 when Siemens could not find enough qualified workers for its newly opened gas turbine factory in Charlotte, the company started the apprenticeship program—which is now one of the more than 550 registered apprenticeship programs in North Carolina. Applying to the apprenticeship at Siemens is no less competitive than applying to a top-tier college. “It’s not that you apply and get in,” said Orkhan Patsiyev, a fourth-year apprentice at the program. After four selection rounds, which include transcript screening, aptitude tests, orientation, and pre-apprenticeship—only four to eight candidates are offered the apprentice positions from an original pool of more than 100 applicants.

Once through the selection process, apprentices at Siemens are paid and receive on-the-job training in mechatronics and machining. At the same time, apprentices work toward an associate degree in machining or engineering technology at a community college nearby, with the full cost of attendance paid by Siemens. Once they successfully complete the program, apprentices are hired as full-time employees and can work at any Siemens location in the U.S., with a starting wage at around $55,000 (which is on par with median family income in America). Most importantly, completion of the program comes with no student debt.

This is why Mr. Patsiyev decided to apply for the program, instead of going to college to study mechanical engineering as he originally planned. “I wanted to go to the apprenticeship, where I get hands-on experience, get a two-year degree in machining, which I could [use] to study engineering later, when I’ve already had a full-time job at the company that I want to work,” he said. “That kind of makes me change my mind.”

The apprenticeship at Siemens involves 8,000 hours of training in total during four years. Apprentices spend most of that time (6,400 hours) at the factory, where they are paired with mentors, who are tenured machinists or maintenance workers at the factory. The apprentices work alongside with the mentors, who show them how to run a machine correctly and safely and answer their questions about the process. “Within the first year, I learned a lot, because we got one of the best mentors,” said Mr. Patsiyev. Even as a fourth year student who knows more about machining compared to when he first started, Mr. Patsiyev said that he still turns to his mentors whenever anything comes up. At the end of each year, the mentors provide feedback on the progress of each apprentice to the apprenticeship coordinator.


Apprentices spend the remaining 1,600 hours at Central Piedmont Community College, where they take classes toward an associate degree in either machining or engineering technology over three and a half years. Apart from these technical classes, they can take some optional customized training programs at the college, such as business etiquette and public speaking, at the expense of the company.


THE REPORT: Varying Degrees 2018

New America's Annual Survey on Higher Education: Executive Summary

After years of economic growth following the Great Recession, people still feel anxious about the economy and see higher education as essential for improving personal financial circumstances. While New America’s second annual survey about perceptions on higher education shows that Americans believe pursuing education beyond high school is important for career growth and economic security, they still feel that higher education is not fine the way it is, and that government should do more to make it affordable.

Varying Degrees 2018: New America’s Second Annual Survey on Higher Education surveyed 1,600 Americans ages 18 and older to better understand their perceptions of higher education, economic mobility, and government funding. Like last year, the survey shows unifying themes, as well as differences across various demographics when it comes to the value of education beyond high school in today’s economy and the government’s role in funding this education. We pay particular attention to the similarities and differences of opinion among Republicans, Democrats, and Independents in this election year.

Our top findings include:

  • Americans believe well-paying jobs require education after high school. Less than half (48 percent) believe there are well-paying jobs that do not require education after high school.

  • Americans believe education after high school creates opportunities. Most Americans (80 percent) believe there are more opportunities for those who pursue education after high school versus only 14 percent who say there is more opportunity for those who pursue work right away.

  • Americans want change in higher education. Like last year, only one in four Americans believes that higher education is fine the way it is.

  • Americans believe public colleges and universities are worth the costbut feel mixed about private and for-profit colleges and universities. A majority of Americans say community colleges and public four-year colleges and universities are worth the cost (81 percent and 65 percent, respectively). Whereas only about two in five Americans believe that private (44 percent) and for-profit (40 percent) colleges and universities are worth the cost.

  • Regardless of demographics, Americans like their local colleges and universities. Four out of five (81 percent) have a positive view of the higher education institutions near them.

  • Americans support workforce-based programs such as apprenticeship.There is wide agreement (90 percent) that apprenticeships and skills training programs prepare students for a good standard of living.

  • Americans believe higher education is a public benefit and that the government should do more to make it affordable. A majority (60 percent) believe government should spend tax dollars on higher education because it is good for society, compared with 27 percent who say students should fund it because higher education is a personal benefit. Over three-quarters of Americans think state and federal government should spend more tax revenue on higher education to make it more affordable.


Christine Haskell, PHD has built her practice on credible, published research and data. In the Research Series, you’ll find highlights, shareable statistics, and links to the full source material.


The Prepared Mind: Our Current Problem

To tackle the wicked problems of our present and future, we need to embrace a strange, counter-intuitive irony: as organizations across all sectors continue to create and adopt technologies like artificial intelligence, employees need to stay relevant by increasing their subjective intelligence.

As production work and other jobs automate, the skills people need to stay relevant are becoming elusive.

As production work and other jobs automate, the skills people need to stay relevant are becoming elusive.

OUR CURRENT PROBLEM

The structures that supported organizations and strengthened the American workforce for generations have been gradually breaking down in every sector. My research on master craftsmen and how they gain mastery helps connect the dots on this new dilemma, and might be the place to seek initial solutions.

It’s a cliché now to even reference the pace of change, exponential growth, and irreversible catastrophes as necessary catalysts for adaptation. We all know that tomorrow’s work will be very different than today’s — we just think tomorrow will remain forever “in tomorrow.” Regardless, in between these recurring reports a truly new change has appeared–one that creates tremendous opportunity with one hand, and keeps the employees from taking advantage of it with the other.

To fully understand this quandary, we need to understand how it took shape. Three primary structures that both support and perpetuate longstanding American traditions are weakening: education; workforce training; and the traditional 9–5 job, and the assumptions of advancement that go with it. Decline in each of these traditions has eaten away a different corner of the economy. All three areas wear down, spread and merge together with technological change, enabling a brand new problem: a job market mismatched to the skills and needs of the workforce.

According to McKinsey, the global consulting firm, the upcoming shift of workers to new occupations “could be on a scale not seen since the transition of the labor force out of agriculture in the early 1900s.”

This dynamic has put American workers in a dilemma. Job reports continue to show bursts of new jobs from time to time, but a range of solid opportunities geared to the future is not broadly reachable for most people. In fact, my research suggests that those best able to adapt and thrive in the years ahead will be people who learn to learn well, and the discipline to think like master craftsmen. However, the American system of advancement has never been designed to prepare people for these requirements.



STABILITY, WHAT IS THAT?

Previous generations could expect a structured, predictable path for career advancement that could last most if not all of their working lives. After attaining a specific degree, you were categorized into a current job, and worked to advance within the company or industry. Not anymore. Today, an employee’s average tenure is just over four years. Companies are increasingly hiring people on a part-time or contract basis.

Enabled by technology, gigging has become more and more mainstream. It has been estimated that 94 percent of the jobs added to the economy from 2005 to 2015 were in temporary, contract, independent, or freelance work. A recent Marist/NPR poll found that approximately 20 percent of Americans’ jobs are untraditional — a figure that could rise to 50 percent in the next ten years.

Since 1995, the percentage of workers engaged in part-time or freelance work has almost doubled.  Image Credit:    Laura Zulliger

Since 1995, the percentage of workers engaged in part-time or freelance work has almost doubled. Image Credit: Laura Zulliger


THE HALF LIFE OF SKILLS

Stability has another enemy: skills connected with a specific occupation are becoming outdated faster than ever. By one estimate, the “half-life” of skills today is about 5 years, and quickly shortening. As digital skills become increasingly required across every job function, employees will have to update and invest in their skill sets even more often. Thus the decline of the 4-year degree in favor of targeted, flexible learning alternatives.

With as much as 45 percent of job activities automated with existing technology there is tremendous pressure for employees to complete with machines to do work faster and cheaper — or decide to change occupations altogether. Pearson, an ed-tech company, estimates that 7 of 10 workers today are in occupations that will see increasing uncertainty by 2030. In McKinsey’s view, the shift of workers to new occupations “could be on a scale not seen since the transition of the labor force out of agriculture in the early 1900s.”

Maruti Suzuki plant--621x414.jpg


THE DECLINE EMPLOYER INVESTMENT

Common sense would dictate that organizations spotting these trends would want to increase internal training efforts to maintain the relevance of their workforce. Some do. Employers like Facebook, Apple, Walmart and the Container Store are just a handful of organizations with notable approaches to internal employee training. Others like General Assembly, Galvanize, and various coding boot-camps are experimenting with new ways to train employees with skills targeted to an emerging need in a specific company.

The last Annual Engagement report published by the U.S. government suggests that 90 percent of leaders believe that building capabilities is a top-ten priority for their organizations; 8 percent track the programs’ return on investment; and, one in four employees get anything out of training.

Internal training programs are increasingly hard to find. One recent study found a 28% decline in employer-paid training across the United States. According to another, Annual Engagement analysis by the U.S. government, 90 percent of leaders believe that building capabilities is a top-ten priority for their organizations; 8 percent track the programs’ return on investment; and, one in four employees get anything out of training.

The lack of training opportunities disproportionately impacts lower-skilled and lower-educated workers, who are the most vulnerable to automation, and those workers who would benefit most from knowing in advance the outcome to which a specific type of training would lead. But make no mistake, lack of upskilling will impact more than just manufacturing. This dilemma will touch every profession from law, healthcare, psychiatry, education — just to name a few.


INVESTING IN THE WRONG SKILLS, WRONG TIME

For most of us, advancing in our lives and careers in a climate where much of what we do is being automated will require different skills — specifically, the capacity for imagination and deep learning. A recent report on the occupations of 2030 showed that 80 percent (8 of 10) top jobs will require creativity, an understanding of systems, and judgment. It is becoming clearer that employees need to start to seek out their own pathways toward training, if not outright invent the job they want to have.

Starting at the turn of the 21st century, the U.S. job market entered a decade of upheaval. As can be seen from this graph, at various times many more jobs disappeared than were created–the worst being just after the 2008 recession. Since 2010, those wild swings have begun to level off, leading to today’s uptick in demand for skilled workers. Image Credit: New America and Bloomberg

Our current systems are not built for just-in-time effectiveness to face adaptive challenges. According to Dr. Anthony Carnevale, head of Georgetown University’s Center for Education and the Workforce, the U.S. spends just $8 billion a year on training, compared to $500 billion on higher education — making the U.S. an education nation, not a training nation.

Adult training programs have had an uneven and often disappointing record of effectiveness. One reason is that they are almost always chasing a problem rather than preventing one which makes them appear out of step and experienced as irrelevant. Another reason is that there is little political will, within the organization or even more broadly across society, that ‘retraining’ is a solution, even as we learn that the ways we’ve tried to retrain workers have not been that successful.

When confronted with this challenge we too often opt for the easy way out or choose challenges with which we are familiar, leaving the hairier problems for the next leadership change. Some of the most promising, innovative approaches to credentialing and adult learning — such as “nanodegrees,” virtual and augmented reality, alternative MBA programs, coding boot camps and MOOCs (Massive Open Online Courses) — attract people already digitally sophisticated or highly educated. In other words, there are so silver bullets on what works at scale to retrain employees for jobs of the future. The challenges to upskilling are especially acute for low- and middle-skilled adult employees — a group that receives little support from employers, and faces many obstacles to advancing, stay up-to-date on market trends, and search for opportunities. They must, therefore, navigate this territory on their own, despite having less financial cushion, scheduling flexibility, core skills, and belief in the payoff of pursuing training in new skills.


THE UNSTABLE MIDDLE CLASS

Volatility in any part of the market hits the low and middle-income the hardest placing them at the highest risk of poverty. In a recent report from the Federal Reserve, researchers found millions of families experiencing significant month-to-month fluctuations in pay. Many of us are already there. Data from the report suggest that 40% of households have no emergency savings and 44% of the adults who responded said they could not pay for a $400 emergency expense without selling something or borrowing money.

As mentioned, support structures (e.g., education, the 9 to 5 workday, and workforce training) that have long held up the economy have not kept pace with the changing nature of work. As employees opt out in greater numbers toward independent work and with increasing turnover in traditional employment, the safety net for many is still built around employer-provided benefits. Workers struggle to find affordable healthcare, start retirement accounts, and many lack disability or unemployment insurance entirely.

A worker saddled with that kind of economic instability has little time to consider self-development. It is not within the realm of possibility to forgo income in order to study. They likely have little savings enabling him or her to invest in starting a small business, undertake an uncertain job search, or invest in a career pivot. Regrettably, taking those kinds of chances is quickly becoming the way to advance one’s career prospects.


MIND THE GAPS: EDUCATION

The World Economic Forum predicts that upwards of 65% of children entering primary school today will eventually work in jobs that do not even exist today. How are schools preparing tomorrow’s adults for a world like this?

44% of the adults in a 2016 survey said they could not pay for a $400 emergency expense without selling something or borrowing money.

We are on a crumbling foundation. A recent study by labor economists found that “one more robot per thousand workers reduces the employment to population ratio by about 0.18–0.34 percentage points and wages by 0.25–0.5 percent.” Despite students’ optimism about their prospects and confidence in their abilities, most employers found recent college graduates poorly prepared for the workforce. About a third of respondents expressed no confidence in training and education evolving quickly enough to match demands by 2026. Some of the bleakest answers came from some of the most respected technology analysts. A primary concern remains about employees’ capacities for applying knowledge in real-world settings, critical thinking, and communication. And those are just a few of the “soft skills” considered increasingly important.

A focus on nurturing unique human skills that artificial intelligence (AI) and machines seem unable to replicate: Many of these experts discussed in their responses the human talents they believe machines and automation may not be able to duplicate, noting that these should be the skills developed and nurtured by education and training programs to prepare people to work successfully alongside AI. In an economy that is getting increasingly dynamic, most schools continue to teach as they always have: with students working by themselves at their desks instead of collaborating on creative projects.

Respondents of the study suggest that workers of the future will learn to deeply cultivate and utilize individual creativity, collaborative activity, abstract and systems thinking, complex communication, and the ability to thrive in diverse environments.

In a 2017 book called “Robot-Proof: Higher Education in the Age of Artificial Intelligence,” Joseph E. Aoun, president of Northeastern University, challenges universities to revamp their entire approach to education. He illustrates a new discipline called “humanics,” which he believes would help students prepare for jobs that will increasingly exist alongside automated machinery. The study of humanics would stress three core skills: data literacy, technological literacy, and human literacy. Aoun also calls for more experiential and applied learning, including regular internships and work experience.

If Aoun is right, how far should schools go? It might be prudent to invest in coding and computer science skills, but since we can’t plan for what change is coming — but we can prepare for change itself. If schools adapt their curriculum to emphasize computer or IT skills, and computers themselves do those jobs within such a short time, won’t those skills be obsolete? Timing and relevance are certainly big concerns. But education needs to last a lifetime, not be targeted toward the half-life of a job or a particular technology. In other words, adult workers should get the same sort of in-depth studies that a youngster receives in elementary school.

If you can’t see yourself doing what you are doing for the rest of our life, you will never advance.

To make such a change really work, those elementary school studies must be truly in depth, and foster a capacity for change and innovation. But in elementary schools, where standardized testing is emphasized, failure is often seen as unacceptable, which discourages thinking outside the box. The current system is designed to “educate people out of their creativity,” says Sir Ken Robinson, author of “Out of Our Minds: Learning to Be Creative” and other books about revolutionizing education. “If you’re not prepared to be wrong,” he said in a 2006 TED Talk, “you’ll never come up with anything original.” This sentiment is echoed by the last carousel craftsmen in America, Art Ritchie, put it “If you can’t see yourself doing what you are doing for the rest of our life, you will never advance.” Surprisingly, some of the most vocal critics of education’s status quo are teachers themselves. Regardless, our schools continue to line desks in neat rows, distributing memorization-based worksheets reinforcing the student as the empty vessel to be filled rather than a whole, creative person with perspective.


MIND THE GAPS: ENTREPRENEURISM

As technology continues its path of creative destruction, of one sort or another, not everyone will need to be an entrepreneur to get ahead. They will, however, need to be entrepreneurial. The tumultuous changes we just described in the economy will require more people to be self-directed, seeking out their own opportunities and charting their own path through them. Reid Hoffman, founder of professional social networking site LinkedIn, calls this needed mindset “the start-up of you.”

To the institutionalization mind of memorized education and organizational conformity American ultra-independence feels like a distant myth, but the pendulum is swinging back. “The whole concept of a 9 to 5 job for life was a historical quirk,” says Susan Lund of McKinsey. “In 1900, 45 percent of people in the United States were self-employed. Today, with the rise of new employment and wealth generation platforms such as Uber, TaskRabbit, and Airbnb, it looks like we’re returning to that.”

The rising percentage of older people in the workforce over the coming decade presents a double challenge: As skills become obsolete with increasing speed, more and more adult workers will need retraining. But most retraining programs still haven’t proven effective.

Image Credit:  NY public library

Image Credit: NY public library

In spite of the many articles being written about the economy’s turn (or return, it seems) to an entrepreneurial future, there is a disconnect between trends and the preferences of the American worker. An Economic Innovation Group (EIG) report found that there is actually a decline in the number of businesses being started, the number of people moving for job opportunities, and the number of workers changing into new jobs.

EIG referred to this phenomenon as the retreat of “economic dynamism” and it impacts multiple demographics. Even millennials seem averse to taking risks and “are on track be the least entrepreneurial generation in history,” according to EIG co-founder John Lettieri. In a 2016 poll from the United States Senate, millennials overwhelming responded that entrepreneurship is essential to the economy, and they consider someone working at a startup a success. Yet when asked about the best way to achieve success, a majority chose employment at one company and working their way up as the best option. This conservative preference is not a coincidence. Millennials carry more student debt, face rising housing costs, and have less confidence about the future than previous generations.

In policy debates about the future of work, experts emphasize opportunity, training, and skills. They compartmentalize and therefore rarely mention the financial stability people need to explore those opportunities.

No one doubts that the situation we are in is complex and thorny. There are many reasons why workers are reluctant to take chances, but it’s also likely that a good number of them would feel bolder if they could afford to and felt psychologically safe enough about their future to experiment. Few connect the dots on this problem.

In policy discussions, these conflicting trends — career instability and income volatility — are continually treated as entirely separate and unrelated. Conversations about the future of work emphasize opportunity, training, and skills; meanwhile, the financial stability that people need to explore those opportunities is rarely mentioned.

Today’s job market is littered with these very dangerous potholes, which can be summed up as follows:

  • Jobs are less certain and structured

  • Skills lose relevance more quickly

  • Pay is becoming highly unstable

  • Employers provide fewer benefits, training, and assistance with career advancement

  • The traditional safety net is ill-suited to the sources of disruption and instability that workers face.



A COMPANY OF CRAFTSMEN AND CRAFTSWOMEN

A clear take-away from all these competing trends is that in tomorrow’s world, courting risk and embracing surprise may be the safest routes to take. For more people to will be willing to dance with this kind of uncertainty, a stronger foundation will have to be laid. Among other things, education needs to prioritize individual creativity, adaptability and entrepreneurial through simulation-based learning; re-investment in on-the-job training instead of just classroom or online learning; and update the safety net that gives people the stability, time, and resources to take risks.

As we wait for our political leaders to catch up with this reality, individuals can take the lead in upleveling themselves. In fact, inspiring outliers to the economy’s declining support structure already exist — and the jobs people are finding aren’t all in high-tech. Benefits of automation are real (and if past trends hold, automation will spawn as many new jobs as it eliminates), but there are lots of people seeking a life, and interesting work, beyond a computer screen. And plenty of consumers are looking for products made by entrepreneurs who think like master craftsmen.


STAYING HANDMADE ONLINE

Charles & Hudson / Flickr / Creative Commons

Charles & Hudson / Flickr / Creative Commons

In 2010, Etsy cofounder and Chief Marketing Officer Matt Stinchcomb had succeeded at something that seemed impossible: he and his partner took an idea about creating a durable business from joyful, ecological and more connected point of view over simply an economic one. What started as a marketplace to buy handmade things became a platform for building more connected human scale economies. Yet, by 2010, he found himself disillusioned with his job.

Matt moved to Berlin for a couple of years to run their international operations. His business partner left and the company appointed a new CEO, Chad. Chad asked Matt to take over marketing, again. “I hated it. I was less interested in email open rates and more interested in the real connections we could create with the platform which is hard to quantify from a marketing point of view.”

“The birth of my son made me question what I was doing with my life. We’re doing a lot of great things with Etsy, but I know that I need to be doing something of service to make this world better. I thought about running for office, and running a nonprofit…”

This birth of his first son made him question is career path and “in exploring some of the ways that fear was keeping me from the convergence of myself and my business, I put forward a proposal to say ‘if we really want to actually be this engine for impact, it needs to be someone’s job to steward it. Not someone’s job to do it.” Matt wanted to go deeper, to think about how do we use the business as the engine for impact and work across the company to give everyone not just the tools, but also the desire to maximize benefit for everyone in the system — he wanted to craft the business.

In 2015 Etsy.com went public, Matt saw an opportunity to pre-endow a different entity with stock. The CEO tasked Matt with the strategy of the new venture, leading to Etsy.org (later the Good Work Institute). Matt took space and risk to re-imagine how business is practiced and taught. He saw a need to “change what we are teaching, how we are teaching, who the teachers are, who the students are…. The things I was reading in all those marketing books wasn’t actually helpful. It was the things I was reading in Buddhist books, or permaculture books, or just what I learned by doing.”

Fear kept Matt from the embracing risk. “I always like to think about the idea that business as usual is destroying the world. Business as unusual could heal the world.” Having no formal business education he felt like an impostor when suggesting alternatives. Ultimately, he was willing to be misunderstood and challenged as he forge in a different direction. “The fear isn’t that you are not an intuitive person. The fear is that you actually listen to your intuition.”

“What I had been feeling on a personal level was disconnection — from nature, from community. That’s what initially led me to start exploring Buddhism. The more I explored that, the less willing I was to be in that disconnected state. I had to overcome those fears to connect these two things.”

The   Good Work Institute   .  conducts something other than business as usual. Image Credit: Franco Vogt

The Good Work Institute. conducts something other than business as usual. Image Credit: Franco Vogt

For the Matt, the keys to success were basic principles that are time-honored but often forgotten: deep connection with a particular problem (or medium), confidence with one’s own creativity, self-management through trial and error, and the constant ability to pivot and learn on the job. In similar ways, countless creative entrepreneurs have used services like Etsy and Ebay to create, and then expand, their businesses.


HUMAN SKILLS IN AN AUTOMATED WORLD

With robots doing everything from conducting funerals, evaluating rules in legal cases, assisting surgeries, and erotic dancing, it doesn’t take much to feel replacement is imminent for everyone. Yet technology has clear limitations — today, and for the foreseeable future.

The trend in automation is to do things more cheaply and smaller. As such, machines excel at processing data and performing routine tasks. However, they fall short on inherently human traits such as humor, empathy, social intelligence, communication, and leading and inspiring others. Machines also aren’t particularly good at a range of other qualities, often identified with craftsmanship, which are expected to be in increasing demand as well. These include deep expertise, creativity, artistry, adaptability, and the capacity for individual creativity that leads to innovation. Master craftsmen are in the business of raising standards.

What will it take for today’s workers to flip their fear and convert threat into an opportunity? Taking the first step requires a shift in mindset — to see technology as not just a machine that must be operated, but a challenge that must be mastered. And it goes a step further, the problem that machine is solving needs to hold a deep fascination for the worker, so that compulsion and drive to solve it under any conditions aids in persistence in our thorniest issues, making any technology that aids the worker a means to a much larger end. The problems people are attaching to, if they are the right problems for them to solve, become their medium of individual expression — much like master craftsmen contend with the idiosyncrasies of wood or stone.

Apprentices of Siemens USA, provide an example, explaining their goal is to move beyond being simply a “machine operator” who “pushes a button.” Instead, they want to learn to become true “machinists” — employees who can understand the bigger picture, program the machine, fix problems, apply judgement, and comprehend with precision how their programming will impact production. This kind of end-to-end perspective returns us back to craftsmanship as it was and moves away from the kind of line specialization that had workers competing with machines to do work more cheaply. End-to-end thinking requires openness, discernment, self-management, and the ability to both seek and find problems.

Learning to think like a craftsman as a manufacturing worker could be applied to warehouse workers at Amazon, Walmart, and others. And the story doesn’t end there. As technology advances and the nature of work changes, both the apprentice and the master craftsman alike will need to constantly evolve, take risks, re-learn and adapt. But far too many will not, unless we start making changes — now — to our systems of education, workplace training, and employee support.


Christine Haskell, Ph.D. is a leadership consultant and adjunct faculty at Washington State University. She helps busy leaders take responsibility for their learning and development. She writes on the topic of “Craftsmanship and The Future of Work.” sharing lessons from master craftsmen and women on personal and professional mastery, is due out late 2019. Sign up for her (semi-regular) newsletter here.

Joint Economic Committee Hearing on the Decline of Economic Opportunity in the United States: Causes and Consequences

[ from the Economic Innovation Group ]

Dynamism in Retreat

The economy today is suffering from too little change, not too much. I realize this is a provocative claim in the age of the gig economy, automation, and the dawn of artificial intelligence. But the fact is Americans are less likely to start a business, move to another region, or switch jobs now than at any other time on record. Indeed, the U.S. economy is quickly becoming less dynamic in nearly every measurable respect.

Why does this matter? If we believe the problem is too much change, it follows that policy priorities will be oriented around mitigating disruptions and hedging against risk. On the other hand, if we understand the economy has grown too static and too risk averse in too many areas, the logical response is a dynamism-boosting policy agenda — precisely what I believe is urgently needed.

Dynamism can be understood, in essence, as the rate and scale of economic churn. It fuels an economy’s process of creative destruction, enhancing our ability to adapt and allocate resources in a more efficient manner. Historically, the high-churn nature of the U.S. economy acted as a kind of shock absorber in times of economic change or trauma.

Guideposts for an Opportunity Agenda

Before discussing potential solutions, let’s play devil’s advocate and ask if declining dynamism is really a problem that can or should be solved. If the decline is inevitable, why bother with useless policy prescriptions? Or, if there are hidden benefits to declining dynamism, why be worried at all?

Dynamism is only worth restoring to the extent that its decline corresponds with downstream negative outcomes. If, for example, we were seeing strong GDP growth, robust labor force participation, increased upward mobility, and strong wage growth, declining dynamism would be a moot point. Unfortunately, we see just the opposite. Furthermore, we can be certain that much of the current dilemma is due to policy choices and thus totally within our control. Nevertheless, our solutions should not fundamentally be aimed at making the economy look more like the past, but rather at ensuring that the benefits of tomorrow’s economy are broadly shared.

Here are five guideposts for a future-oriented opportunity agenda:

1. Focus on new firm creation and competition. Access to opportunity suffers when incumbents are too powerful, markets are too concentrated, and entrepreneurs are an endangered species. Policymakers should rebalance the playing field with lower barriers to entry and greater emphasis on the unique needs of new companies. This includes, among other things, reforming exceedingly complex tax and regulatory regimes, which serve to protect incumbents from competition, and boosting access to capital and talent for new ventures. It also includes accelerating the pipeline of high-skilled workers into the labor market — both through better skills training and by fixing the truly self-defeating U.S. immigration system.

2. Enhance geographic mobility and labor market fluidity. Central to any opportunity agenda should be empowering people to move to places of opportunity and efficiently develop and deploy their skills in the marketplace. Among other things, this means getting rid of onerous occupational licensing requirements, designing a safety net that does not discourage mobility, and revamping local zoning and land use regulations so that high-opportunity areas can accommodate more people.

3. Invest in the future. The United States has benefitted enormously from previous decades of massive public sector investments in infrastructure and basic research, but we often forget why such investments are critical to private sector innovation and dynamism. As we renew our commitment to smart public sector investments, we should also abandon 13 traditional economic development incentives, which too often amount to giveaways that mortgage the future of local communities. New approaches are needed.

4. Growth is still key. The United States is in desperate need of stronger GDP growth, which itself would go a long way to addressing concerns about access to opportunity and upward mobility. A broad pro-growth agenda is necessary, but we should also be bold in incorporating ideas aimed at helping struggling regions regain their footing. Meanwhile, let’s resist the temptation to feel complacent given our relatively strong post-crisis performance in comparison to other developed economies. Their present struggles are a glimpse into our economic future unless we take action soon.

5. We need data. It is hard enough to diagnose complex problems when data are available. Without sound data, we are left with little more than faith-based policymaking. The federal government should protect and expand its investment in the economic statistical agencies and allow for improvements that will make their work even more useful in the years to come.  But that is not enough. In light of how little we know about solving long-standing problems (especially related to upward mobility), federal policies should aggressively support novel approaches and reward state and local policy innovation. A more experimental approach to policymaking alongside existing legacy programs could provide a wealth of new data on what works and what should be discarded.

Conclusion

The decline of dynamism poses a threat to economic opportunity and upward mobility for future generations. A country as prosperous as the United States has a moral obligation to devote serious resources and brainpower to ensuring that everyone — especially children from poor backgrounds — has a shot at a better life. This is by no means the job of government alone, but the public sector has a crucial role to play in organizing the necessary attention and resources. The good news is that we retain enormous advantages and resources as a nation — more than enough to meet this challenge if we choose.


Christine Haskell, PHD has built her practice on credible, published research and data. In the Research Series, you’ll find highlights, shareable statistics, and links to the full source material.


The Challenge of Declining Dynamism

In a 2016 poll from the United States Senate, millennials overwhelming responded that entrepreneurship is essential to the economy, and they consider someone working at a startup a success. Yet when asked about the best way to achieve success, a majority chose employment at one company and working their way up as the best option. This conservative preference is not a coincidence. Millennials carry more student debt, face rising housing costs, and have less confidence about the future than previous generations.

In policy debates about the future of work, experts emphasize opportunity, training, and skills. They compartmentalize and therefore rarely mention the financial stability people need to explore those opportunities.

[ from The Committee on Small Business and Entrepreneurship United States Senate ]

This decline has far ­reaching implications. Americans are far less likely to start a company today than they were 30 years ago—far less likely to see starting a business as a pathway to realizing the American Dream. This corresponds with a series of other interrelated trends that point to a less dynamic future.

Americans today are also less likely to move to new areas of the country. They are less likely to switch jobs. The average company is rapidly getting older. Industry sectors are seeing widespread consolidation. Historically, the churn caused by a steady influx of new businesses has acted as a kind of shock absorber for our economy. This is no longer the case. Even as the global economy has undergone massive transformations driven by technology and globalization, the U.S. economy is rapidly becoming less flexible, less able to adapt, and less efficient at allocating resources—including its most precious resource: human capital.

These changes are felt most acutely in those parts of the country that have fallen behind and are struggling to replace lost industries and millions of middle class jobs. As a result, a rising tide of geographic inequality separates millions of Americans from the economic gains of the national recovery, as fewer areas than ever are carrying the bulk of overall U.S. economic growth.

The consequences are dire. A less entrepreneurial America is one with increasingly limited opportunities to realize the American Dream.

Today’s policymakers will decide if our economic future belongs to the incumbents, or if we will instead renew the entrepreneurial spirit that has fueled American dynamism from the very beginning.