Knowledge Workers and Tomorrow’s Jobs

President Obama, in his 2015 State of the Union address, proposed that America’s community colleges be made tuition free.[1]  With advancing technology, including on-line instruction, that seems to me to be a sensible step. But only a step. America’s education system needs a comprehensive overhaul in order to educate enough people rapidly enough to meet the rapidly changing demands of the 21st century, rather than those of the 20th.

Peter Drucker discussed this need for what he termed “knowledge workers” and provides his usual profound insight to the matter. Here is a post from a year ago that discusses Drucker’s ideas. It is well worth repeating.    — C.H.


Peter Drucker and the Knowledge Worker (from 10 January 2016)

Peter Drucker is arguably the most widely respected of the 20th century management consultants. Drucker wrote over 30 books on management, which are largely focused on human behavior. His 1999 book, Management Challenges for the 21st Century, offers a forward looking assessment of what demographics suggested would be the key problems facing manager in the early decades of the 21st century. Drucker’s concept of a knowledge worker – those whose work is focused on knowledge and its applications – is central to this book. He contrasts knowledge workers with manual workers – those whose work is essentially focused on things and the manipulation of things.

The Knowledge Worker

With his characteristic bluntness and surety, Drucker states:

“Knowledge-worker productivity is the biggest of the 21st century management challenges. In the developed countries it is their first survival requirement. In no other way can the developed countries can the developed countries hope to maintain themselves, let alone to maintain their leadership and their standards of living.”

Drucker credits Fredrick Taylor’s “scientific management” for the awesome improvements in manual worker productivity that characterizes 19th and 20th century industry and agriculture in the developed countries. According to Drucker, those increases in productivity have been the primary source of incremental wealth in the developed world.

The industrial engineering concepts that constitute “scientific management” are quite portable, so they can be quickly applied anywhere, using workers with little education or training. Developing countries have lots of people, many with rudimentary educations at best, who are willing to work for close to pre-industrial wages. Developed countries have aging populations and declining birthrates, hence much higher wage expectations.  

The bottom line is that labor intensive, repetitive manufacturing in the developed countries simply isn’t competitive in this globalized world, a few special cases excepted (at least for a while). Developed countries need sophisticated work based in knowledge, rather than in method. Economies in developed countries need knowledge workers. As Drucker puts it:

“The only possible advantage developed countries can hope to have is in the supply of people prepared, educated and trained for knowledge work. There, for another fifty years, the developed countries can expect to have substantial advantages, both in quality and quantity”.

What To Do?

There have always been knowledge workers, so much is known about knowledge work. Much can be learned about knowledge worker productivity from professional firms such as surgical practices, legal firms, architectural firms and accountancy firms. Today’s medical practices, for example, have several types of knowledge workers – specialized nurses, radiological technicians, physician’s assistants and such – that enhance the productivity of physicians, the practices’ key resource..

For manufacturing firms that intend to become and remain Sustainable, significant changes in organizational practices and organizational structure will be needed. This means new and innovative business models. Obviously, doing all of this will require study, careful thought and even more careful implementation. There isn’t any real alternative to embracing the change. Start by reading (or re-reading) Peter Drucker’s Management Challenges for the 21st Century !

Chuck - Austrian AlpsThoughtful comments and experience reports are always appreciated.

…  Chuck Harrington (Chuck@JeraSustainableDevelopment.com)

This blog and associated website (www.JeraSustainableDevelopment.com) are intended as a resource for smaller manufacturers in the pursuit of Sustainability. While editorial focus is on smaller manufacturers, all interested readers are always welcome.


[1] For more on my thoughts on President Obama’s proposal, see: http://jerasustainabledevelopment.com/2015/01/24/tomorrows-talent/

 

The People Puzzle

A Master Plan

“… so that we can imagine far into the future and life is still good. That’s what ‘sustainable’ means. It’s not some silly hippy thing – it matters for everyone.”

That’s how Elon Musk defines “sustainable” in Tesla’s recently released Master Plan, Part Deux. [1] The Master Plan goes on to outline Tesla’s approach to making a sustainable (solar) energy economy a reality. A solar powered economy is a key component of a future where “life is still good” – for everyone. But it is only one component. This post looks at another component – the future of employment, meaning how people might produce their livelihoods as the future unfolds over the coming decades.

Pieces of a Puzzle

Robot businessman imageUntil the middle of the 19th century, the great majority of Americans worked in agriculture. Then, the advent of railroads and the American Civil War marked a profound change — from a nation of farmers to a nation of industrial workers. A couple of decades more than a century later, the smoke stacks stopped belching and America began morphing, then rushing, toward a post – industrial economy, whatever “post – industrial economy” means for the American workforce.

Frankly, “post – industrial economy” isn’t very well defined, especially from the perspective of the millions of diverse individuals that constitute the American workforce – all of whom want a “future where life is still good”. While that future is far from clear, there are some pieces that, like a jigsaw puzzle, can be examined and fit together.

Here are a few of those pieces:

>> The Age of Oversupply: Daniel Alpert’s 2013 book, The Age of Oversupply, posits that the economic emergence of formerly iron curtain countries and of export oriented Asian countries has resulted in a global glut (billions!) of under-educated workers and of capital looking for higher returns.

>> Demographics: There are dramatic changes evident in the demographics of economically developed countries, including the U.S. Birth rates are declining and populations are aging. In Japan and a few western European countries, populations are actually shrinking. Changes of this magnitude have significant social, economic and political repercussions.

>> Jobs and Education: A recent Bloomberg article entitled Educated Americans have taken almost every job created in the recovery [2] maintains that the U.S. economy has added (or recovered) about 11.6 million jobs since 2010. Of these, about 99% of those jobs were filled by people with at least some college education. Only 80,000 – less than 1% — were filled by people with a high school diploma or less. (Note: The population of the U.S. increased by about 12.3 million between 2010 and 2015).

>> Coal Miners and Re-education: There has been much talk about the demise of coal as a fuel. Of course, that means displacement for those who make their living in the coal mining industry. Re-education comes up frequently. Exactly what these people might be retrained to do does not come up so often.

>> Poorer Kids: A recent McKinsey & Company article informs us that:

“Most people growing up in advanced economies since World War II have been able to assume they will be better off than their parents. For much of the time, that assumption proved correct: except for a brief hiatus in the 1970s, buoyant global economic and employment growth over the past 70 years saw all households experience rising incomes, both before and after taxes and transfers. As recently as between 1993 and 2005, all but 2% of households in 25 advanced economies saw real incomes rise.”

“Yet this overwhelmingly positive income trend has ended. A new McKinsey Global Institute report, Poorer than their parents? Flat or falling incomes in advanced economies [3] finds that between 2005 and 2014, real incomes in those same advanced economies were flat or fell for 65 to 70 percent of households, or more than 540 million people.”

>> Robotics and Automation: Tesla’s Master Plan, Part Deux, mentioned earlier, provides other insights on employment and the future. The Master Plan suggests that advanced manufacturing techniques could accelerate production rates between 5 and 10 times on a roughly 2 year iteration cycle. That means many more vehicles per employee. The Master Plan also mentions vehicles without drivers.

Closer to home, my local grocery and hardware stores are installing more self – checkout aisles. The bank that I use now has ATMs inside as well as outside. Retail stores (and their employees) are being thumped by on-line shopping. The beat goes on.

Robotics and automation, fueled by advances in artificial intelligence, are proliferating rapidly. Good for product costs and (presumably) prices. Not so good for people needing jobs.


What Next?

This essay is about finding (or creating) a future where “life is still good” for everyone, in a post – industrial economy. What that entails is, indeed, a puzzle. The few pieces of that puzzle mentioned here seem to fall into three areas: demographic changes, advances in technology and education. The next post to this blog, The People Puzzle – Part 2, will begin to fit together the pieces of this puzzle and attempt to draw some insights as to what that future where “life is still good” might consist of. Stay tuned.

Chuck - VancouverThoughtful comments and experience reports are always appreciated.

…  Chuck Harrington

(Chuck@JeraSustainableDevelopment.com)

This blog and associated website (www.JeraSustainableDevelopment.com) are intended as a resource for smaller manufacturers in the pursuit of Sustainability. While editorial focus is on smaller manufacturers, all interested readers are welcome.

Image credit: robot / puzzle graphic via www.dreamstime.com


[1] https://www.tesla.com/blog/master-plan-part-deux

[2] www.bloomberg.com/news/articles/2016-06-30/americans-with-more-education-have-taken-almost-every-job-created-in-the-recovery

[3] www.mckinsey.com/global-themes/employment-and-growth/poorer-than-their-parents-a-new-perspective-on-inome-inequality