Why Western Workers Should be Scared, Really Scared
I just finished reading a great, insightful article in the New York Times, Once a Dynamo, the Tech Sector is Slow to Hire.
A key message in the article is that not even the technology sector creates new jobs in the United States. This is not much different throughout the Western world.
The article touches on a couple of interesting developments.
• The hierarchy of the world is changing. The Western world is no longer per definition on top of the value chain. Many of the skills of Western workers might be high quality, but they are not cutting edge. The problem here is that the emerging countries are upgrading their skills fast and thus the work in which we need high quality becomes a question of price. It is a no-brainer to figure out the winner here.
• Innovation happens everywhere. I like the term “reversed innovation” which Vijay Govindarajan describes like this: “A reverse innovation, very simply, is any innovation likely to be adopted first in the developing world. Increasingly we see companies developing products in countries like China and India and then distribute them globally.” Govindarajan and Trimble wrote a great article about this; How GE is Disrupting Itself. The point is that innovation no longer just happens in the Western world.
What are the solutions for workers in the Western world? The New York Times article states that “some economists and policy makers are looking to health care to lead an employment surge. They point to the field’s growing demand for new services, the need for physical proximity for many patient procedures, and a bureaucracy that entails layer upon layer of jobs.”
As the Western populations age, taking care of each other will be a job growth area. I am just not sure this will help pay the bill for the societies we have in the Western world today. In my view, Western workers should be scared, really scared…
What is your take on this? How do you think the Western world should create jobs?
Well yes they could be scared but what practical purpose would that have?
For me, feeling scared either represents looking backward and clinging on to the way things used to be or looking to the future and feeling frightened about the terrible things that may happen – or may not.
Alternatively, if citizens had been better prepared by their schools and universities they would perhaps realise that there are unlimited opportunities to innovate and be entrepreneurial in today’s world.
New technology means anyone can have a shop front that the world can come by.
The world has changed a lot in the last few years. Many people focus on the economic crisis as the main cause of this, but for me the more influential changes have been globalisation and the growth of new technologies.
Together, these mean that the whole model we have for employment has to change in response. Many companies are not hiring particulalrly in Europe, because employment legislation means that it is very expensive to shed staff who are no longer needed.
Companies need to be super flexible in the their staffing to be able to compete in a global economy. Therefore potential employees have to be flexible and be willing to do contract work/part time etc if they want to be employed – even if they are highly qualified.
But the bigger tragedy is how students have been led to believe that a degree will lead to a good job – for life even.
A degree is not enough. A degree means your employer will have still have to train you up. Something they no longer are prepared to invest in in many cases.
However, if a graduate can add evidence of creative thinking, innovation, customer service, entrepreneurial thinking etc to their CV then the potential employer can see immediately what value they may add.
Alternatively, all these highly skilled people without work could look around and see that despite all our ‘progress’ the world still has many ‘pain points’ and problems. With some creative thinking and innovation they could look at solving someone’s problem. That could be the start of a useful business, an income stream and possibly employment for others.
Hi Trudy, you ask a good question. What does it help to be scared? I agree that an approach like what you suggest would be a good cure for what is happening although there are no silver bullets. Hard work, focus, lots of passion – and a chunk of luck is needed to get the Western world out of the world we have digged ourselves into. It will be interesting to see what will happen…
Why should we be scared? There is not a finite number of jobs. Sure, maybe the days of there being 500million rich consumers and 5.5billion serfs engaged in subsistence agriculture are over. But its about time!
This is a tremendous opportunity. These new skilled workers will also become consumers. More production, more trade, more economic growth, the planet gets richer. With any luck the wealth might just be spread around a little more evenly.
Well Stefan…you live in a progressive, civilized, Socialist country !
Denmark will not throw it’s citizens out on the cold hard street…but in the US this is common-place, and will become even more so.
Let’s keep in mind that we live in a world of Finite resources…we DO NOT have a spare asteroid or 2 to strip mine (:>)
In the future the developing world (China) will rule the roost…this is not news…Mao-tse-Tung planned for this in 1950…others are carrying out his vision.
What does it mean for Westerners…the only way that they can remain viable is to learn to function in a -0- Growth Environment.
Scandinavian countries are prepared to do this…the US under “things” like Gingrich, Hannity, Beck, and self-serving “republicans”…the answer is obvious.
ReV
The key is education. Sadly in the USA, education is broken. (note: not boke, brokeN). For too long the politicians have wanted an uneducated electorate. Now they have one. The side effect is that US students can no longer compete. Most adults are only semi-literate. Yes, I live here in the USA and see it on a daily basis. Game is over. I don't know how my children will earn a living here.
Next; corporate greed. Employers no longer see employment of people as a positive aspect of business. They see it as an expense. So if its cheaper to employ 3 Chinese than one local, they fire the local person to increase short term profits. Problem is when no locals are earning any money anymore, there is no local market for the products either.
I don’t believe that the (public) educational system has failed…but it is clear that the ruling class (not the politicians…they are just sycophants of the money class) would like things back around 1880 when there were no taxes of any sort and any “public” spending was purely at the beneficence of the wealthy, or possibly the church.
This gives the ruling class the feeling of “importance and prestige” they so desperately crave