January 27, 1998
by Konrad M. Kressley
This is the fifth article in a series about the future. An earlier installment described the coming of the Information Age. This segment describes some of the ways in which the world of work will be different in the next century.
As part of a Fulbright travel grant, I recently had the opportunity to tour a Hyundai auto plant in Korea. I had prepared myself to encounter swarms of workers, but was surprised to find that the noisy assembly halls were only sparsely manned. Most of the operations, such as cutting, shaping and welding steel parts, were performed by robots on a seamless assembly line that snaked through the building from the roof to the ground. Sure, there were people to spot glitches and program the robots, but they were few in number. Since then, I have learned that more and more assembly operations, both here and abroad, are performed in this manner. It is the wave of the future.
Now, take a look around you and note how many tasks once performed by humans are now in the domain of the machine. Take the car-wash, or better yet, Automatic Teller Machines. While the steel money boxes don't come cheap, they offer enormous advantages to the banks. One expert claims that each ATM replaces three bank employees. Besides the salary savings, the machines never complain about over-time, demand fringe benefits, join a union or do any of the other things that give ulcers to the boss. They're ideal employees. So what's next? Your bank is probably trying to sell you on "interactive" banking, allowing you to initiate transactions via your home computer and modem. Consumer advocates say that unless you're totally homebound or do a huge amount of banking, the additional charge is hardly worth the small improvement in convenience. It can't make checks clear faster, if that's what you had in mind. On the other hand, the banks experience considerable cost savings, because you'll be supplying much of the interactive hardware and telephone charges for transmission.
Years ago, the first generation of robots took on some of the physical tasks performed by manual laborers. Currently the second generation of robotics makes it possible to automate clerical tasks. Futurists predict that the next generation of computers will take over many managerial and professional tasks. New airliners are so highly automated that pilots are only needed as trouble- shooters. There is some debate as to whether "fuzzy logic" and artificial intelligence can replace human intellect. In any case, evolving imaging and data-storage technologies can certainly land a hand. Robot surgery, now entering the mainstream, provides doctors with a truly exact and steady "hand," while a computer compilation of court records would permit a lawyer to skip much of the tedious research to prepare a case. It's probably more challenging to speculate about which tasks cannot be automated. Occupations that require creativity, imagination, leadership and interpersonal skills, such as negotiations, head the list. Any literary, artistic or spiritual activity would also qualify.
Conventional wisdom has it that service occupations, like those in the fast-food industry cannot be automated, but will always require lots of little people to make them work. Think again. As you read this, clever gastronomic engineers at McDonald's fabled Hamburger University are putting the finishing touches on robots that can prepare everything from fries to Big Macs. Meanwhile, other labor-intensive industries, such as nursing care, are also looking for help from sophisticated machines. While the computer jocks and engineers are having a field day, social scientists are scratching their heads wondering what all this means to people who are looking for work. There is obviously a spectrum of opinion on this issue. Optimists believe that the Third Wave will create new and yet unknown occupations. Who, for instance, could have imagined the job of systems analyst in the 1920s? Pessimists suggest that evolving technologies will continue to make human labor ever more irrelevant. From a historical perspective, large-scale technological innovations usually have wrenching human consequences. Not everyone is equipped to ride the Third Wave along with Bill Gates; many will fall by the wayside as their skills and knowledge become obsolete. Read Thomas Moore's book The Disposable Workforce or Jeremy Rifkin's The End of Work, both published in 1996, to get an idea. In a nutshell, far fewer workers will be needed to supply society's requirement for goods and services in the next century. Social problems loom on the horizon as our nation, founded on the work ethic, contemplates the prospect of having huge numbers of permanently unemployed citizens.
From today's perspective, the industrial age was characterized by a high level of stability in terms of employment. It was fashionable to complain about regimentation, yet both workers and employers valued consistency and security. Now, information-age technologies are spawning more flexible "virtual" enterprises that are no longer tied to a fixed location or permanent staff of employees. Let us examine a few examples of this phenomenon. Take the movie industry: Until recently, the major Hollywood studios operated like a factory, turning out films in an assembly-line fashion. Nowadays, film making may involve a different set of writers, actors, financiers and locations for each movie. Studio bosses have been replaced by "deal makers." If you order merchandise by mail, you may also be dealing with a virtual enterprise. Colorful catalogs give the impression that your order goes to a factory and warehouse. In fact, many of those 800 numbers are nothing more than electronic mail drops transmitting your order to a vast network of independent suppliers. As internet use become more widespread, electronic marketing will capture more and more of the retail sector, turning stores and sales clerks into an anachronism. Daily newspapers will feel the ripple effect. Newspapers are still a relative bargain compared to other consumer purchases. But did you realize that they currently generate a major portion of their income from classifieds and other forms of print advertising? As the on-line market place gains acceptance, the news industry will also be dramatically transformed.
Nike, the sportswear manufacturer, is a virtual corporation on a global scale. Multi-million- dollar advertising campaigns lead consumers to believe that these are American products. Not so. There is no Nike factory; shoes, shirts and all their other products are produced by legions of third- world contractors who pledge themselves to follow manufacturing standards dictated by the home office. As you can imagine, the combination of an All-American product image with some of the world's lowest paid workers yields astounding profits.
Which segment of the labor market is registering the fastest growth? If you guessed temporary services, you are correct. Just as the virtual enterprise thrives on flexibility in production and marketing, employment policies follow the same pattern. The phenomenon can be understood in terms of the "just-in-time" inventory control systems. For many years, corporations that produced cars and other durable goods maintained huge warehouses full of parts to be assembled. More recently, rapid transportation and computerized data-transmission technologies have made it possible to ship parts directly from the supplier to the assembly line without a costly layover in a storage facility. Now, the "just-in-time" philosophy can also save money on labor costs. Specifically, management only wants the workers that are needed at each moment in time. That means hiring and firing at a moment's notice. Permanent employees are also the more costly since they have been conditioned to expect pensions, health insurance and other benefits on top of straight salaries. The recent waves of corporate downsizing can be explained in terms of automation and information technologies that permitted the elimination of mid-level management layers. Older employees are the most vulnerable. Meanwhile, temporary employees and subcontractors are filling in. Do you know about out-sourcing? Instead of performing all operations in-house with a permanent labor force, many corporations have turned labor intensive operations over to smaller firms that do not have to contend with entrenched unions, benefit plans and other burdens of established enterprises. A large part of America's much heralded growth of small businesses can be traced to these corporate "spin- offs." Few car buyers realize that their new vehicle may contain a majority of parts manufactured by firms totally unrelated to the proud logo on the hood. None of this is meant to demonize the business sector; it's simply the most efficient way to offer goods and services to the public. To be sure, government and the non-profit sector, such as education, are following suit. States and local governments call outsourcing "privatization," when they transfer their convicts to corporate-run prisons. Meanwhile, universities try to trim their permanent faculties by hiring more part-time instructors and instituting "distance learning," the electronic version of correspondence courses.
So what does this mean for individuals? First of all, even though folks still need to eat and pay rent on a regular basis, they can forget about permanent or long-term employment in the future. Even the Japanese are catching on to this. It means, essentially, that people can expect to have a variety of jobs and careers in a lifetime. The industrial era required order and stability, putting golden handcuffs on suitable employees. Now, employees must shed the "cookie cutter" mentality of the assembly line and approach the fluid Information Age labor market with open minds tuned to the requirements and opportunities of the moment. Career development, from this perspective, becomes an adventure with both risks and opportunities. Not everyone is up to the challenge, particularly middle-aged workers who thought that they had a secure job and then found themselves swept away in waves of corporate consolidation and downsizing during the past two decades. Did you know that computer giant IBM cut roughly half its workforce in the ten years leading up to 1995? Those who want to survive need to pull up their socks, upgrade their skills and look over the horizon.
And now, a few words about the Information Age workplace. To begin with, instead of heading to the office each morning, people will increasingly find their workplace coming to them. It probably started when sales people and managers of far-flung enterprises began hitting the road. Eventually those people traded their office for a company car and a lap-top computer. Now, cellular telephones allow folks to conduct business from almost anywhere. Much of the "virtual" workforce will be tele-commuting and working out of home offices. Such tasks as book editing, consulting or stock-market analysis require neither a city office nor face-to-face contact with the boss. All you need is a good PC and a quick modem. Disabled or house-bound individuals have the most to gain.
Obviously business managers love it: they can cut back on office space, utilities, equipment and employee amenities. Workers like the idea of not having to "dress for success" or enduring long commuter drives during rush hours. Other issues still need to be resolved. For instance, not everyone will be able to blend home life and work harmoniously. The loss of human contact in organizations cannot be replaced by E-mail chatter. Indeed, social psychologists and management gurus suggest that frequent human interaction helps bond organizations through friendly competition, mutual support and other forms of interpersonal relations. It is unlikely that electronic substitutes such as teleconferencing will maintain the loyalty and cooperative spirit that are the hallmarks of successful enterprises.
Some of difficulties mentioned in this article can be resolved through educational reforms. At one time people thought of schooling as a way to fit individuals precisely into occupational slots. Now, we need to rethink this proposition and help folks to master uncertain and changing occupational requirements. Instead of specializing, students will have to learn how to learn, i.e. they will need an education that strengthens intellectual development and learning capacity over a lifetime.
There is still a shortage of people with computer and related high tech skills. While computer literacy will always be important, the current need for technicians should not necessarily be projected into the future. The next generation of information technology promises to be much more user-friendly. You will no longer have to earn a degree in Electrical Engineering before being able to program a VCR. You will probably communicate with the VCR and other computerized devices by speaking to them in plain English, Chinese or whatever your language happens to be.
Educators of the next century need to emphasize the importance of creativity, social skills and the ability to communicate. Social skills are necessary for team work, customer service and living in a multi-cultural society. Furthermore, continued globalization of our economy will require people to gain a working knowledge of foreign languages, history and social diversity. By the way, some futurists are concerned that computers have been oversold as educational devices. They contend that many of today's youngsters are already spending more time interacting with machines than with people. I dare you to imagine what long-run consequences this will have for society.
Some people imagine that the Information Age educational system will be a totally electronic enterprise, where books and teachers will have been replaced by CD ROMs and talking heads on flickering monitor screens. The "virtual" student, equipped with home computer and modem, will never have to set foot on the grounds of his or her alma mater. But why visit there? It's just a shed with a lot of electronic equipment crammed inside. While this scenario appears to be most efficient and cost effective, serious futurists contend that this is not likely to happen. Higher education involves more than the transmission of information; it requires interpersonal exchange of ideas, which doesn't work well in the dehumanized electronic environment. These futurists also suspect that traditional educational establishments will survive to meet social needs that blend the fun of sports and parties with the more serious mission of finding a suitable spouse.
The greatest efforts, no doubt, will have to concentrated in the area of Continuing Education. We are already experiencing a rush of adults returning to school in order to keep pace with changes in the occupational world. We all know folks who are working their way through college; in the future people will have to college their way through work. Some firms have the vision to guide their workers' continued training and education. Many more are likely to take the short- term view of hiring and discarding workers as the moment demands. Under these conditions, individuals need to take control of their fate by continually reevaluating and upgrading their skills in terms of the evolving job market. Let's face it: In order to survive professionally, all of us need to become futurists!
The next installment in this series will examine the future of Social Security, pensions and investments needed to support an aging Baby Boomer population in the next century.