The future of jobs and how we will define "work" cast many questions for forward-thinking executives.
But first, what does the expression "the end of work" mean? It's the result of technology—defined as artificial intelligence (AI) and "robotization"—exerting a slow but continuous degradation on the value and availability of work, in the form of wages and the number of adult workers with full-time jobs. The widespread disappearance of jobs would usher in a social transformation unlike what we've ever experienced or imagined. The issue won't be saving jobs; it will be saving or recasting the concept of work, which has become a religion in its own right.
Already, careers that once were viewed as progressions up a ladder are now often multidirectional and lateral. In 1994, Suffolk University professors Robert J. DeFillippi and Michael B. Arthur defined these changes as the creation of the "boundaryless career," where the career path is defined by the individual's soft and hard skills, not by his formal education or experience.
So, what are some aspects of the future workplace that will affect executives' decisions and strategic thinking? Read on.
AI and robots increasingly drive economic growth
In "The Future of Employment: How Susceptible Are Jobs to Computerization?" Oxford University researchers Carl B. Frey and Michael A. Osborne present a model that calculates the probability of substituting a worker in a given sector. Frey and Osborne conclude that machines might replace 47 percent of active workers in the future.
In addition, of 1,896 prominent scientists, analysts, and engineers questioned in a recent Pew survey on the future of jobs, 48 percent of them said the AI revolution will be a permanent job killer on a vast scale. And the Bank of England has warned that within the coming decades robots could replace as many as 80 million U.S. jobs.
Job creation is very different today than it has been in the past. The newest industries being created are mostly related to computer software, telecommunications, and like applications, are the most labor efficient, and don't require many people.
Economic historian Robert Skidelsky, author of Keynes: Return of the Master, predicts that "sooner or later, we will run out of jobs." If Skidelsky is right, it raises the question of what will our society look like without universal work or something close to it? So, a basic question for leaders is: Do I take advantage of the AI/robotic revolution and plan for a massive replacement of my workers, or somehow organize work to protect workers by making more flexible arrangements?
Contingency work and the "gig" economy
One in three U.S. workers—53 million people—are now "contingent," already contending with the changed structure of work, perhaps juggling multiple jobs and serving as temporary, "gig," or self-employed workers. An increasing number of corporations, government institutions, and even colleges and universities have replaced full-time workers with part-time and contract or piecemeal workers, many without any security or benefits.
During the recent recession, many Americans who lost their jobs scrambled to make a living. Simultaneously, Internet commerce expanded, enabling the most specialized consumer wants to be met with great efficiency and speed. This provided some enterprising individuals the unprecedented ability to capitalize on their own hands, minds, things, and hours.
Thus, says Jacob Morgan, author of The Future of Work: Attract New Talent, Build Better Leaders, and Create a Competitive Organization, the gig economy was born: Americans were able to turn a craft expertise into an Etsy side job, or a car into a job for Sidecar, Lyft, and Uber for a little extra money. Benefit-less, contractor jobs that fill the gig economy include low barriers to entry and flexibility of schedule.
Sara Horowitz, founder and CEO of Freelancers Union, believes that the jobless future is here. Many people already are combining part-time work just to get by, she notes. In an article in The Atlantic, Horowitz writes that as of 2005, 30 percent of the workforce has participated in this "freelance economy," and entrepreneurial activity reached an all-time high in 2010.
Management consultants McKinsey & Company estimate that by 2025 some 540 million workers will have used one of these gig platforms to find work. The benefits to companies are obvious: instant access to a pool of cheap, willing talent without having to go through the lengthy recruitment process and without costly benefits. For the taskers, the benefits are not so good. However, the champions of crowdsourcing maintain that it provides a powerful force for the redistribution of wealth by providing a fresh stream of income into the economy.
In balance, the new work reality is more likely to increase income inequality and depress wages. The big challenge for governments will be how to codify, and provide ethical, legal standards for this kind of work, to prevent abuses by employers.
So, a key question for leaders is: To what degree will contingent, contract, and gig workers become a more permanent feature of your organization? The result would require restructuring everything from the use of office space to benefits and employee motivation.
The disappearance of jobs, income inequality, and the consumer economy
In Rise of Robots: Technology and the Threat of a Jobless Future, Martin Ford asks "What happens to the consumer economy when you take away the consumers who are not working?" And what will happen to much of the infrastructure that supports the world of work as we know it—from the building of suburban communities supported by a commuter working force to the endless rows of office buildings?
It also means— writes Richard Freeman, a leading labor economist at Harvard University—that far more people need to "own the robots" inclusive of other kinds of automation and digital technologies in general. Some mechanisms already exist in profit-sharing programs and employee stock-ownership plans. Other practical investment programs can be envisioned, he says.
Whoever owns the capital will benefit as robots and AI inevitably replace many jobs. If the rewards of new technologies go largely to the very richest, as has been the trend in recent decades, then dystopian visions could become reality. But the machines are tools, and if their ownership is more widely shared, the majority of people could use them to boost their productivity and increase both their earnings and their leisure. If that happens, an increasingly wealthy society could restore the middle-class dream that has long driven technological ambition and economic growth.
The concept of a "living income" also allows us to keep the wheels of the economy and innovation turning. "A fundamental insight of economics is that an entrepreneur will only supply goods or services if there is a demand, and those who demand the good can pay," writes the Center for Internet and Society expert Andrew Rens.
Progress depends, in no small way, on people buying stuff, and that depends on them having an income. Whatever the reasons for the disconnect between productivity and wage growth, it's a problem for everyone, not just workers. Rich people like their money, but who wants to live in a world where the haves hide in cloistered communities defended by private armies, while starving have-nots work for peanuts, if at all?
To date, we have chosen to distribute society's resources largely based on our ability and willingness to work. We appear to be rapidly evolving to a world where assets, not labor, are the primary drivers of prosperity. So, the question is: How can we move toward an economy that equitably distributes benefits in an asset-based economy?
Defining work and its value
Prior to the 20th century, in English the term "job" connoted fragmented, low-quality piecework. But through time we elevated some of these to the status of "real jobs" and labeled the minority who performed them as job holders.
Peter Frase, author of Four Futures: Life After Capitalism, describes how automation will change North America, based on his argument that human labor will end, along with our belief and commitment to "work for work's sake." Many experts would argue that for some time now, jobs have not been motivating or rewarding for most people, as evidenced by studies that show as many as 70 percent of workers are not engaged in their jobs. The modern quest for meaningful work underpins a paradox: We are both disengaged from our jobs and terrified of losing them.
For decades, psychologists and other experts have demonstrated that intrinsic factors—purpose, meaning, creativity, fulfillment, and autonomy—are absent in the typical job today. Several studies have shown that North Americans place a higher value on work and work more hours than Europeans, and feel guilty when they are not productive. This emphasis will exacerbate the problem of the disappearance of jobs from the lives of many.
Will the vacuum be replaced—as has often been forecasted—by leisure time? One such possibility would be the development of creative communities such as "maker spaces" or industrial shops of artisans in small communities.
One theory of work proposes that people see themselves in jobs, careers, or callings. People who say their work is "just a job" emphasize that they are working for money rather than aligning themselves with any higher purpose. People who pursue a calling do not do it for status or pay, but for the intrinsic fulfillment of the work itself.
There was a time when work and home were distinct realms. The old industrial clock regulated our lives into discrete blocks of time, and there was a clear separation between public and private life. No longer. The constant connectivity of mobile, digital technologies erases the boundaries of the week and weekend and their characteristic social relations. How will we maintain the line between "my time" and "employers' time"?
Recent studies from research at McKinsey conclude that providing meaningful work to employees was the most important contributing factor to a high level of engagement. In The Progress Principle, author Teresa Amabile reports that of all the events that can deeply engage people in their work, the single most important factor was meaningful work. "Beyond affecting the well-being of employees, research shows that the ‘inner work life' affects the bottom line," she writes.
Repercussions
It is difficult to predict with accuracy how technology will shape our future, to what extent it will be used in favor of the citizen and the public good. What has become clear is that it has fallen on society to assume responsibility for the way technology is used—including to protect individual identity and privacy from governments and corporations.
Technology is not the solution to hunger, war, and poverty, but merely a tool. Society can no longer meekly adopt it without thinking of the repercussions of particular advances. Rather, we must actively ensure that it enhances our quality of life the way we had hoped it would. If not, technology will keep advancing but society will lag behind.
Questions for Leaders to Consider
- "The central question of 2025," insists GigaOM lead researcher Stowe Boyd, is "What are people going to do in a world that does not need their labor, and where only a minority are needed to guide the robot-based economy?"
- How do leaders need to take advantage of the artificial intelligence/robotic advantage to maintain competitiveness?
- How do people support themselves?
- What does it mean to be a productive member of society in a post-job world?
- How do we define work?
- What strategic steps do leaders have to take now to prepare for the very different world of work in the future?
Read more from CTDO magazine: Essential talent development content for C-suite leaders.
