The Future of Work: What the March of Technology will Bring Us
As the march off technology continues on, we are left to ponder a larger and perhaps deeper question: just what will the future of work look like? We have become accustomed to taking jobs for single employers where in most cases we work on location for a standard 40 hour work week five days a week. The standard employment contract, except for the low-skilled labor market, often consists of wages plus benefits. The fortunate few may remain in the same jobs for most of their working lives.
This has not been the case for many years now. When Bill Clinton was president during the early 1990s he famously observed that the average worker would change careers seven times over a lifetime, and therefore training programs would be necessary. This was clearly a recognition that the march of technology would render many jobs, and ultimately career paths, obsolete.
Meanwhile, technological advances have made it unnecessary in many cases for workers to work on location. Increasingly, they can, and many do, work from remote locations. Many are contingent workers and work on projects that are temporary. Many workers who at one time may have been “employees” of a firm are now independent contractors going from job to job. This isn’t necessarily a bad thing, but it does require modification of the traditional employment contract.
If workers go from project to project, then they need portability in terms of their benefits. Employer provided health insurance can no longer be an option. Rather insurance needs to be purchased individually by the worker, or it needs to be provided by a central body independent of employers. That is but one reason a single payer system appeals to so many.
The short of it is that work in the future economy will be more career based than job based. What that means is that one’s career will transcend one’s job, as workers go from project to project with different employers. This might be the very meaning of the bit economy. As new technology will make some types of work obsolete, it may result in many workers only being employed when they are absolutely needed. In between projects, workers become free agents.
The work one has done has always been an important component of one’s identity, but in the future it will be even more so, as workers will no longer be able to be identified by the firms they work for. As workers go from project to project as independent contractors working from remote locations, they will be able to define the terms under which they work.
Arguably, this has the potential to make workers more independent and have greater flexibility in scheduling, thus enabling them to spend more time with family, and being able to spend more time at their children’s school functions. No longer will they have to devote themselves to the one company in the hopes that loyalty will be rewarded with promotions and bonuses. In the new bit economy, loyalty no longer exists.
The commitments that workers make will be career based and embedded in industry. The traditional career ladder will no longer exist. This may be neither necessarily good nor necessarily bad. Employers have long been dis-investing in their workers. The stability that workers long enjoyed in no longer there, which is not a good thing. But the liberation that workers have from the control of specific firms may well be a good thing.
The future of work may be different as many workers displaced due to technological advances ultimately end up taking new jobs because they want to; not because they need to. As the march of technology renders many jobs, mostly menial and low-skilled, obsolete, there may be a need for a universal basic income (UBI). If set correctly, any number of workers who used to have to work will no longer need to, but if they decide to, they will do so because they want to.
The confluence of the technologically advanced bit economy along with a UBI will most likely result in more personal investment in human capital, which is to say that more workers will indeed be skilled workers. This doesn’t mean that there won’t be other places around the world where masses of workers continue to be unskilled. Rather, in the world of comparative advantage the U.S. economy, which has always been capital intensive rather than labor intensive, will be a high tech bit economy with a skilled workforce.
The future of work, however, cannot arrive without a significant role for the public sector. The public sector needs to continue to invest in infrastructure, both real and virtual, but it will need to invest more into human capital. K-12 education will need to be revamped. Unemployment Insurance (UI) may need to be rethought, perhaps allowing for more partial unemployment. One idea is to have partial layoffs and allow workers to collect some benefits. Another idea is to give displaced workers lump sums of money so that they could perhaps return to school or develop their own consultancies.
Or the future of work could involve a complete restructuring of the welfare state as we have known it. Instead of traditional UI and public assistance programs, we might just have a UBI along with Individual Development Accounts (IDAs). With such an account, government would deposit a certain amount of money each year into everybody’s account, beginning at birth. Instead of contributing to Social Security, workers would pay into their IDA. They could then draw on it for college, retraining and ultimately retirement. Anything left over could be bequeathed to their children.
We are at the cusp of “the future of work.” It is a shame that nobody in the Democratic party is seriously talking about it. It is equally a shame that nobody in the Republican party talks about it either. Instead they offer the same old tired ideas for growth as though the current economy will remain forever. It would appear, however, that change and the march of technology really waits for noone.