“The Wealth of Humans: Work, Power, and Status in the Twenty-first Century“
by Ryan Avent
St. Martin’s Press, 288 pages.
“Silicon Collar: an optimistic perspective on humans, machines and jobs“
By Vinnie Mirchandani
Deal Architect, 280 pages.
Dealing with the elimination of human jobs is the top moral question for those of us in the IT world. In most cases, the software we create uses automates to speed up an organization’s daily tasks by taking the work away from humans. When around 70 percent of what workers do day-to-day is menial tasks, there’s a thick layer of boring, error-prone, tedium that can be automated.
Intuitively, this reduces the amount of human labor needed, that is, it reduces jobs. There’s an ongoing theory that smacks of “trickle down economics” head-patting that these lost jobs are recreated elsewhere, but the effect of the current automation-scythe has the potential to slice away more jobs than, say, displacing tellers at banks with ATMs.
An example here is the destructive effect of driverless cars on truck driving. With some estimates putting truck driving as the number one source of employment in many American states, at around 3.5m people total, the relative handful of programmers creating the software for driverless cars will soon be responsible for cutting, well, 3.5 million jobs in America, and much more globally.
In the best scenario, as pointed out in a recent Slate Money podcast, for humans, automation is more about transforming jobs rather than eliminating jobs. As the “best-worst case scenario,” this often means transforming a person’s job so dramatically that the worker has less pay, less employment stability, and less benefits; It’s the gig economy as we currently know it.
Though they offer little in the way of “solutions,” the two books I looked at this month try to frame that dilemma and even provide some solace.
Vinnie Mirchandani’s Silicon Collar tries its best to turn the automation frown upside down by describing the positive effects of automation in an endless series of use cases. More somber, Ryan Avent’s The Wealth of Humans describes the current era of automation and it’s threat to human-labor, kicking up a vision of future thick with a jobless miasma.
Software is Eating Labor
If the question is preserving people’s jobs in the face of AI’s, robots, and automation it’s good to start with what humans are good at. To preserve our monthly paycheck, we need to find what business value we have that differentiates us humans from the robot rivals. Avent tries to do just that in “The Wealth of Humans.”
Rather than comforting us, he ends demonstrating how hard it will be to compete with code and, equally, how difficult it will be for humans to band together to resist job disintegration. He paints a slowly-rolling-in dystopia that could serve as the jumpy newsreel, over-the-credits explainer for one of the later William Gibson books: “as you know, Bob, all these rural vets in VR rigs are jobless because of how much work IT has automated over the past 30 years.”
Avent does a great job cataloging and contextualizing the causes of this shift across all types of labor: from manual, repetitive work, to previously thought of untouchable knowledge work.
Mirchandani’s book is a wunderkammer of digital transformation. It relentlessly catalogs how IT is changing and improving business processes. One use case, for the example, explains how the human-component in auditing is being reduced by automation: auditors don’t need to actually go into the field for “look-sees” to verify inventory when automated logistics and inventory systems can be trusted.
IT Isn’t the Only Hand on the Guillotine
Paired with automation, there are other economic trends that are changing the nature of work. One of the most notable is globalization. While we know all about manual labor-based manufacturing “going off shore,” higher value work like programming, accounting, and just about any labor can also be arbitraged out to countries that charge cheaper rates. Trade rules, cargo ships, and the speed of communications (“The Internet”) enables the flow of this business across boarders and time zones, eliminating the geographic constraints that labor has relied on for years to create on-shore jobs.
Combing automation and globalization puts workers on even shakier ground. There’s less need for high-paid humans because their job can more often be done by a “robot” or shipped off shore to someone who’ll eagerly do it for less.
But this also means that companies are threatened. The same two forces mean it’s easier to replicate a company’s core products and services: what differentiates the companies from the latest “copy cat” across the seas, or on your own shore? As well explained by Professor Rita McGrath‘s transient advantage theory, companies and workers need to find a defensible competitive advantage that can’t be swiped by other geographies and IT-wielding disruption bandits.
Colo Rules Everything Around Me
Avent believes that both companies and individuals need to look at something he calls “social capital” for this differentiation. This is the unwritten, almost unknowable collection of knowledge and practices that the staff in a corporation follows and use to create their magic, their differentiation.
While he uses an interesting description of The Economists’ social capital, Avent doesn’t provide many solid examples to explain the concept. Thankfully, there are many deep wells out there that describe “social capital.” Though 29 years old, my favorite book on realpolitiking caustic corporate cultures, Moral Mazes, fits well here. More on the rainbows and unicorns side, social capital is close to what DevOps cultists call “culture.” Ben Thompson speaks often of the strategic value of the highly intangible, but insanely valuable culture that defines the way companies like Apple and Google are successful.
Key to Avent’s social capital theory is that maximizing value requiring being face-to-face, co-located. Pretty much by definition, once social capital can be written down, systematized, and transmitted — turned into information — it loses it’s differentiating value: it can be easily known and copied by rivals.
As someone who’s worked remotely most of my life, I’m suspicious of the need to co-locate. Of course, working remotely, I’m highly biased. In my 20 years of working in both modes, my sense is that the benefits of all being in one place seem mostly a choice, a result of a standard operating procedure. As numerous open source projects and virtual companies show, it’s possible to choose a “remote first” culture. The productivity glamour of Slack is a good anecdotal data point here and hopefully, the continual growth of SaaS will provide more proof points and capabilities for making remote work easier for organizations to adapt.
Granted, Avent is talking about mega-cities, not just one office. But, the need to cram together into cities seems like the weakest point in Avent’s discussion. It also leads to a bizarre discussion of how too much zoning and regulations in cities leads to high real-estate prices, limiting workers ability to get good jobs in those cities.
While true, that seems like too small of a problem to focus on when trying to solve global labor problems. To me, the core problem, which Avent discusses, is how much cash corporations and executes have been hoarding, locking up capital in a wafer thin slice of society as everyone else looks hungrily through the restaurant’s window.
It’s not just the mega-rich that suck up the supply, though. It seems to me that just as the “1 percent” hoard their wealth, the rest of us in mega-cities are hoarding regular and social capital by insisting on face-to-face work and, really, not doing much to increase the diversity of all types in the workforce. As Avent says: “Workers seek to make themselves scarce by reducing the capacity of others to compete with them.” We wouldn’t expect anything else from Lizard-brains hidden in suits and gleaming, blue glass condo towers.
Mirchandani briefly discusses increasing gender diversity as a de-hoarding tool, but a discussion of the practical side of doing so is missing. Clearly, there are much need to spread the wealth more evenly over all types of disenfranchised people. The demographics of the recent U.S. election certainly show that us privileged cash-hoarders have been ignoring their plight too long.
Ecosystems Are Expensive to Build
While Avent focuses mostly on white collar social capital, there’s also much to be said for “ecosystem capital” (to use an awkward phrase) that you see in Asian manufacturing and, historically in the Detroit area. The denser the clusters of factories and related firms, people say, the more efficient your manufacturing will be; otherwise, I imagine, there are the costs in time and money of shipping and various tariffs as the good cross borders. No doubt, there’s also a hefty dose of Aventian social capital flowing in those factory hubs as well.
If you care about manufacturing, the real question is around the time and cost it takes to build up such an ecosystem in your desired geography. For example, from virtually nothing, China built up it’s so-called “iPhone city” in around 10 years kicked off with something like $10 billion in government spend and subsidies. That doesn’t include ongoing government support, and, of course, Apple’s initial and ongoing spend, adding billions more, no doubt. Looking domestically, some early “mulling” on building out an Apple display factory in the US estimates the cost at $7 billion; no doubt, that would come with additional government subsidies as well.
Anything is possible if you want to pay for it.
Today’s Workers Are Ill-Poised to Save Themselves
Increasingly, what people are finding is that it’s hard to find the types of jobs they know how to do, that pay what they’re expecting, and that aligns with their identity. The last two problems are especially vexing since so many service sector jobs are filling up labor growth curves. This space is full of social quagmires that, as Avent points out many times, we’re ill prepared as a society to easily solve.
For example, while growth in health-care is one of the bright spots, as a recent New York Times article profiled, many unemployed workers have a patriarchal-induced mental block against training for and taking these jobs. They think of “care” jobs as “woman’s work.” As one interviewee in the NY Times piece puts it:
I ain’t gonna be a nurse; I don’t have the tolerance for people. I don’t want it to sound bad, but I’ve always seen a woman in the position of a nurse or some kind of health care worker. I see it as more of a woman’s touch.
As if retraining and finding a new job aren’t intractable enough problems, Avent ratchets up the stress: what if we end up automating all the jobs away? Like…all the jobs. In addition to being identity defining for many of us, much of our economic system is built around people working to fuel the economy, to get the cash they need to sustain the spend of their “life styles.” If you remove the font of cash from that system, all of the sudden (over a few decades, let’s say), things look terribly grim.
Call your Congressman and lobby for portable benefits. Push for a safety net for individuals who do multiple jobs. If they are thinking of funding Universal Basic Income, ask them to also consider using some of the funds instead for rapid retraining programs to allow workers to transition to new skills. Or to invest in the energy, health, and road infrastructure that will generate a new generation of jobs.
Let’s Not All Become Jerks
Feature image: New Old Stock.