The Work Market
There are some colossal political forces in action today. Many of our largest and successful companies operate in numerous countries and continents. They have little affiliation for their originating nation nor any other. The measures revolve around costs and productivity, not the wellbeing and continued employment of the current workforce. This doesn’t mean they are deliberately jettisoning people, just operations will be moved to the optimum location.
One of these factors upon which decisions are made is the cost of employment; wages, employment law and training. Post-Brexit, the UK will be able to respond to the needs of business, if it desires, to attract them to settle here. The inherent dangers for employees include the removal of the wage safety net, relaxed laws which allow easy dismissal and diluted Health and Safety regulations. It is possible the quality of the jobs available for the majority of people will be poor.
It is very likely that any trade deal with the USA will be driven by the demands of American businesses. Employment in America is more precarious than in the UK. However, Employment Law in the UK today is far more business friendly than the rest of Europe. To compete the temptation for the UK Government might be to concede workers’ rights. It isn’t certain this will happen but there will be a concerted effort from certain multi-nationals to influence UK policies.
Wikipedia describes Moore’s Law as, “the observation that the number of transistors in a dense integrated circuit doubles approximately every two years. The observation is named after Gordon Moore, the co-founder of Fairchild Semiconductor and Intel, whose 1965 paper described a doubling every year in the number of components per integrated circuit, and projected this rate of growth would continue for at least another decade. In 1975, looking forward to the next decade, he revised the forecast to doubling every two years.”
This may appear to be gobbledegook to some of us but a simplistic interpretation is the amount of power of Information Technology is rising at an exponential rate; in 20 years it will be 1000 times more powerful and in 22 years by 2000 times it is now, in 24 years 4000 times more powerful, in 26 years 8000 times and so on. It is not possible to get our minds around the unbelievable scope and opportunities this creates.
Again, technology supports the view businesses can operate from anywhere. The key factor will be skills and education. The incredible increases of graduates in, for example, India and China the two largest populations in the world may give them the edge. These two countries have issues today regarding language, infrastructure and culture for Western businesses but these are becoming less relevant and they are creating their own companies which are competing hard.
The robots are not only coming but they are here. The business case is compelling; imagine if a robot costs £50000, which may equate to two people’s salary and it can replace 12 human beings, the pay back is just two months.
Together with Artificial Intelligence (AI) the effect on employment is going to be immense. The Chief Economist at the Bank of England has estimated that 50% of today’s jobs will be impacted in the next 10 years.
Let’s consider a job which many of us would think has to be carried out by a person, that of a doctor. We build a relationship and trust with our GP, not least of which is because we know the doctor has 7 or more years training and is, therefore, competent. He or she can observe us and assess our demeanour and behaviour.
Yet doctors are highly fallible and make mistakes. An automaton will be able to instantly access all of our data, any test results, family history and our DNA. It will be 98% correct, perhaps twice as accurate as a person. It will be a major step forward, which will be strongly resisted by the people it can help.
So, if even the job of a doctor is under threat, what roles aren’t vulnerable?
Some research by accountants PWC, estimates around 50% of jobs occupied by people with few qualifications will be done by technology, 36% of those with people with a “medium” education and 12% of the jobs of graduates. Roles traditionally taken by men will be hardest hit.
It is the pace of the change which is the threat. Technology is in revolutionary mode and employees are in gradual evolution; the contrast is too severe to accommodate the effects. Of course, since the times of the Luddites there has been resistance to the introduction of technology and the economy has adapted and even more jobs created. The specific workers may have been badly treated but the overall trend has been positive, including rising standards of living.
A very real concern today is about the quality of the jobs which will be created, even if there isn’t mass unemployment. What will pay levels be like? What strange hours will people need to work? Will there be a demand for extreme flexibility?
It is amusing to note that Charles Duell, Commissioner of Patents for the USA in 1899 said, “Everything that can be invented has been invented”. Good job, Chuck, a man of vision.
Jobs will exist but increasingly people will need to move to where they are, especially the good ones. This may even mean between countries, so Brexit may make that more difficult. Companies will pay for the skills they need, so which skills should we be targeting for ourselves?
What will be the effect on families and relationships?
What happens if you need more than one job to survive?
What if your partner has a career?
Resources and the Environment
The world has finite resources and some are already becoming scarce.
There is increasing pressure on organisations to be environmentally sensitive.
Constant innovation is needed to deal with these issues, and the costs of purchase and responsiveness.
Employment will go to those of us who can contribute to solving the problems emanating from there issues.
Losing jobs in;
- Manufacturing (once 25% of all jobs in the UK, now less than 10%)
- Traditional retail
- Gaining jobs in;
- Low wage occupations
- Call Centres
- Non-traditional Retail
- High Tech
In the section regarding employment for young people we reflect that in a study by an academic named Fritz, he showed that the top ten jobs for school and university leavers in 2010, none even existed 6 years before; staggering again. How can we prepare ourselves and our children?
The unemployed are better off than those in employment 60 years ago. This is a staggering statement but if a view is taken in a materialistic way it is true. The average home in the 1950s did not have central heating, a phone or a washing machine. Many still didn’t have indoor toilets, showers or televisions. It was a different planet. The safety net is stronger, albeit not across the whole world and there are pressures on the systems. But even if we can survive, is a life without a job or something worthwhile the way we want to carry on?
In the UK there is low unemployment today, relatively. There are more jobs, even if many are McJobs. The unemployment statistics have been massaged over the years by the exclusion of certain groups of people, who don’t have jobs but survive on State Benefits.
Even so there are, for example, 20% of job seekers with a long-term illness, which inevitably restricts the options and 30% have no qualifications at all, which reduces their range of possible jobs.
By 2025, it is estimated that 75% of jobs will be taken by millennials, people aged under 40. What about the rest of us? How should we adapt? What sort of jobs will be available for us?
Do these themes worry you? Hopefully, they have got you thinking about the impact the trends and pressures will have and how you can respond. These are high level macro issues and there are both positives and negatives; there are threats and opportunities. Our view is, that with some thought, there is scope for personal development and success.
People who sit back and wait for solutions to be delivered to them may struggle but people who take considered action will thrive.
In other articles and videos we will be addressing how the workplace will change and what the employee of the future needs to behave like.
Recommended reading: “The Future of Work” by Jacob Morgan