So hints the Wall Street Journal today, in an excellent, thought-provoking article by Lauren Weber. The gist of the matter is that large corporations across the country are doing everything they can to cut labor costs. This means, for now, outsourcing, independent contractors, other contractors, temps, and freelancers. I took away three things from the article.
First, it’s absolutely true. Employers no longer wish to employ employees. Read the material and look at the graphs. Consult Google – or your own employment experiences. I’ve talked about this before. James Altucher regularly says the same things. It’s happening (or happened).
And it is not, in and of itself, a bad thing. Yes, “traditional” career jobs are harder to come by, vanishing, in fact. But they were a relatively new phenomenon anyway. The 40 hours a week for 40 years thing came along some time in the industrial revolution. Before that people either worked in small businesses, worked for themselves, or grew crops. Things changed. They’ll change again.
Ms. Weber looks into the desperation (and greed) of some of these job-cutting companies. She also looks at the downside(s) for displaced employees (several of those). What jumped out at me, my second take-away, was this:
Some economists liken the strategy to Hollywood studios, which greenlight movies and then hire directors, actors, editors, special-effects teams and marketing agencies for production. All those outsiders work together to deliver the movie, but the studio has no long-term obligations after the film’s release.
This, I see as the silver lining. The silver screen lining, we’ll wittily call it. The directors, actors, editors, effects, and marketing people of Hollywood clean up – at least for the big films and productions. The actors get the fame so I’ll concentrate on them. Jennifer Lawrence (who is so hot) doesn’t care if a movie is a one-time contract gig because she gets $10 Million for her part. She likely also negotiates residual income from it as well.
Actors can command these sums (some of them) and dictate some terms because the have value. They have it, they know it, and they sell it.
This may be the short-term future of employment. Gerry Spence once wrote (and I cannot remember in which excellent book…) that he hoped some day people would be paid based on their talents. He hoped the employees could dictate their own terms. Big business had that reversed for years; society came to accept it – for most jobs. The actors did not. They sold their talent for what it was worth – what people would pay for it within market limits.
Hopefully this trend will spread outside of Hollywood and Burbank. Whoever you are, whatever you do, you have talent and value. Use it. For now. I say “for now” because of the third thing that jumped out at me, the 800-pound mechanical gorilla in the room:
BNY Chairman and CEO Gerald Hassell vowed to “drive down the labor component of our company” with technology that can perform tasks currently done by people. Other companies view contracting as a stopgap until more jobs are automated, freeing firms to dispense with some workers altogether.
The robots are not coming. They’re here now. And they’re getting “better” every day. What’s coming is their revolution. Right now there are very few jobs which cannot be performed by some android, bot, or AI. In a few years (years, not decades) it will be virtually 100% of the jobs. The decades part will fully round out the 100%. 0 humans needed at that point. And that means 0 jobs. Which means 0 pay. Which will make it a little difficult to pay for the goods and services the bots produce.
This can of worms is open and we’re all getting into it (look – there’s one crawling on your ankle right now). This revolution will either be the greatest thing to ever happen to humanity, one of the absolute worst, or the very last. Fun will be had by all…