Future of Work: From GRAFT to CRAFT(#11)
This podcast is part of our Future of Work series, brought to you in collaboration with Trezeo. Ben Robinson is joined into the conversation by Laetitia Vitaud — renowned author and researcher on the topic — and we explore the role of platforms, individuals, policymakers and startups in enabling a future of work that works for everyone. We also discuss the changing nature of the firm in a world where inside/outside boundaries get blurred by the rise of freelancing and self-employment.
Welcome to Aperture|Podcast, where we’re conversation with the people who are thinking and doing things differently. We cover strategy, technology, business models and much more.
Books mentioned in this podcast:
- Du Labeur à l’Ouvrage, by Laetitia Vitaud
- The 100-Year Life, by Lynda Gratton
- Reinventing Organizations, by Frederic Laloux
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Full podcast transcript:
Ben Robinson (BR): Welcome to the Aperture Podcast. This episode is part of our series on the Future of Work, which is brought to you in collaboration with Trezeo, a financial services platform for self-employed workers. And for this episode we are with Laetitia Vitaud, who is a renowned speaker and writer on the Future of Work. She’s also Editor in Chief of Welcome to the Jungle, which is a platform for recruiters. Laetitia is here in Geneva… she’s in town because she’s promoting her new book, which is called Du Labeur à l’ouvrage. And it deals with the shift in employment from paid full time work to a world which is made up much more of craftsmanship and freelancing.
I think the place to start with this book, Laetitia is very much the product of your own personal journey. So could you maybe just tell us how you arrived at this point and what motivated you to write this book?
Laetitia Vitaud (LV): Thank you for inviting me first. Yes I started writing about work because I was unhappy at work. The reason why I picked this subject was that I realized that it was a large enough subject for me to be able to write about history, sociology, economics, psychology and all the other subjects that I’m interested in because it deals with all these things. So intellectually speaking, it’s just the perfect subject. And the second reason was that, on a personal level, I hadn’t solved the question of how can you be happy at work? How can you find a place that fits, that makes sense to you and possibly others too? So how do you find meaning and revenues at the same time?
I used to work for a company, a computer services company, and I was extremely miserable and it was really not only labour, but complete alienation. And I changed jobs the first time and became a teacher and I was a teacher for eight years and… liked my job but then found another form of alienation, which was its repetitiveness and dealing with the idea of doing the same thing over and over and over again with all those yearly rituals, beginning of the school year, end of the school year, the exams, and these very repetitive rituals have this paradoxical effect of giving you the impression that time flies. It’s paradoxical because you think that something repetitive will make time last longer, feel longer. It’s the opposite. So eight years happened extremely fast. I had my two kids and all of that and then had this kind of panic.
Literally I had panic attacks at the idea of being in the same place, doing the same thing 20 years from now with the world moving at a fast paced and me being in the same place, doing the same thing in the same way that the previous generations did. That led me to the realization that I have to find a way to do something else. And that was a literary a quest that took a couple of years. It led me to leave my country, France, leave my position as a civil servant in the French éducation nationale as a teacher. I joined an American tech company based in London and did recruiting for that company for a couple of months. Didn’t like it either. Still not found the thing… and then left the company and started my own.
I probably needed that transition of being employed by another company before I could start my own. I wasn’t ready yet. I needed all these steps before I could create my own company. And that was now a bit more than four years ago. And I would say that I’m pretty certain that in four years I will still have this company and be self-employed. I’m not a hundred percent sure, but I think that’s it because it’s a flexible enough vehicle for me to do different things and transition from one job to another, from one subject to another with more autonomy and I do find that a lot of pleasure at work and I like what I’m doing now.
BR: So your own experience is one where up until now every job had trade-offs. So the teaching job had flexibility, but it was monotonous. The job working for the American tech company, I presume was quite well paid, but it had alienation and other shortcomings.
LV: Actually the teaching job was not that monotonous. It was quite exciting because I had a lot of autonomy and I could teach my students lots of things about American politics and history. It was very interesting. The problem is it was extremely badly paid. I mean, very badly paid. And because it was so badly paid, it signals to the rest of society, namely the French society, that you’re not worth much. And probably there’s a part of me that’s ambitious and that suffered from the way other people were looking at me, someone with no value and I know there’s this confusion between price and value and I definitely felt it. And had I been a professor with tenure at an American university, probably doing a bit of the same thing I may not have left.
BR: …and the bit about the book that’s most optimistic is this idea that, so we’ve gone through several cycles, right? So we used to have boring jobs, that came with a bundle of benefits and that bundle of benefits got unbundled and jobs got unbundled… but when you look forward, do you see the possibility for people to do meaningful work again on their terms? So can you just maybe talk us through exactly that sequence and why you’re so optimistic?
LV: So what I call the contrat de labeur… it’s this idea that in the Fordist Age, as in the work on Ford’s assembly lines, you had a very repetitive job most of the time. You had division of labor and subordination but in exchange for that type of alienating work, you had a bundle of benefits, not only stability, but also a good wage that you knew would get better and better because you had powerful unions fighting for you. And a good share of the pie, basically. You had social protection and health insurance, retirement, future revenues, paid holidays, political identity, etc. etc. And the promise of upwards mobility for your children. And all of this made the relative alienation somewhat acceptable. And when we say today that a lot of people… I often hear the new generation doesn’t want boredom anymore, as if the old generation like doing repetitive jobs and boring things.
Of course not. It’s just that yes, the bundle, the tradeoff that came with this alienation is dwindling away. And now obviously the new generation is questioning the alienation that used to come with the tradeoff. So I don’t think it has anything to do with one generation being fundamentally different from another, but rather it’s systemically one type of contract, of deal that is not what it used to be. So the deal is today that you still have alienation. You still have division of labor and subordination in most jobs in organizations, but you have a lot fewer of the benefits that used to be the tradeoff.
Wages are stagnating or declining. Job security, forget it. Social protection, not quite what it used to be. Pensions, we know they’re not going to be the same. Access to housing used to be a part of the bundle (I forgot that when I made the list). Access to housing is more and more of a problem. Access to credit… and access to housing because you can borrow money, but it’s just not enough to buy an apartment. I mean, if you have a secure enough job, you have access to credit. But even with that credit, you can only have a 10 square meter flat for that money because the real estate prices in the urban centers where most of the jobs are, have gone up tremendously.
BR: So you’ve talked about how the bundle is being unbundled and you said that younger generations don’t want boredom anymore. But what it seems to me you’re saying is they’re getting boredom without the bundle, right? So the worst of the worst.
BR: But your book is essentially a very optimistic view of the future. So why are you so confident that things will be better from here on?
BR: There are a few reasons that lead me to be somewhat optimistic because there’s also a part of me that’s pessimistic about the present and I’m not naïve and I know that right now things are not looking good, but there are a few… I call them the pioneers of the future of work that are showing the way and that are changing aspirations, culture and probably organizations to some extent. Those pioneers are the freelancers and makers and IT developers who only want to be self-employed in autonomous and who created the open source ecosystem and who change the culture of the work place and work spaces and collaborative tools and collective intelligence and et cetera, et cetera. All these things really started with this IT crowd at the beginning of the internet; by the way the first co-working space was created a bit more than 20 years ago.
That’s just a good example. And today co-working is this huge business and it’s a huge industry because all the other corporations are turning to co-working as a way of being more modern and more appealing to the younger generations. So if you take the IT developers who are self-employed, some of them managed to work remotely because they just don’t want nine to five constraints. And increasingly salaried workers in these organizations have obtained some extra flexibility that they didn’t have at work. And that’s changing management because once middle managers who are very reluctant to accept it, find out that everything is still fine, that everything is still working, then they accept that flexibility as a default can be possible. And that’s changing life, changing also the way you can balance work and life. It’s changing the way, presenteeism was controlled very strictly. It’s changing things to, to my mind quite profoundly.
BR: So the same factors that caused work to become unbundled… so if we say improvements in telecommunications that allowed work to be globalised, for example, and the same factors that have led to some degree to feelings of loneliness and isolation. You’re saying those same factors can actually provide agency to people to get a better bargain?
BR: Because it’s been unbundled, they can demonstrate their own individual worth more easily and therefore achieve higher pay and better conditions.
LV: Some of them can. And especially those with the skills that are in high demand on the market. Now the question obviously is what about those with skills that are not in high demand?… And yes, of course things are much more difficult for them. They have the precariousness without any of the freedom.
Although sometimes with the same level of precariousness and low pay, some of them prefer the flexibility of platform work because they can choose their shifts, because they can choose exactly how many hours they work. And it’s easier to juggle the constraints of having a family for example, and looking after your children, whereas if you work for a less flexible company on a zero hour contract, sometimes. On top of that you have the cost of transportation and strange hours of the day or you have the cost of finding a way to have to find someone to look after your children. And so with the same level of pay, sometimes a bit flexibility on the side of the worker is indeed a little bit of a gain. Now for most, that’s not enough obviously. But that’s more a question for public policy than it is a question for individuals because there is only so much you can do when nothing’s regulated and when you have no safety net and when you have no training institutions to help you transition to a different career. There’s only so much you can do on your own when you’re not well connected.
BR: So if we accept that some people prefer the autonomy and it comes from an increasingly sort of unbundled workforce or remote workforce or however you want to describe it. And if we assume that some people have the skill sets to be able to bid up their own paying conditions. So there are two groups in the workforce who are everything else being happier than they would have been before. What about everybody else, because how do we get better conditions for all of those people, essentially preferred the old paradigm of boring job but a good bundle of benefits versus boring job and very few benefits? And it could even be worse, boring job, few benefits and very precarious hours, zero hour contracts…
LV: Absolutely! You can have division of labor, subordination and precariousness and low pay. You can have all of the bad things, but what is it that makes all of this type of deal possible? It’s a society where you can prey upon the weak. It’s a society where there is no protection whatsoever. No redistribution of wealth. It all boils down to what kind of society do you want? You want something that looks more like the Danish model or do you want something that looks more like the UK model? And that’s fundamentally a political question.
BR: Okay. So how does the government… is it through raising the minimum wage? It seems to be in the new model that an awful lot of responsibility gets transferred from employers and from the state to the individual. So should the state be picking up some of the responsibilities that got transferred from corporations for example? I mean, so in the U S, the government tried to intervene into providing or at least underpinning the healthcare provision, right? Is that where the government should move into?
LV: The trap or the thing that you shouldn’t do is do like what the government did with Walmart in the U S, it’s called The Walmart Effect. That you have jobs that are so poorly paid that most people are on Medicaid. They have, you know, health insurance provided for by the state. And sometimes they even need food stamps… they basically depend on government programs because they’re too poor to have a decent life. So in a way, that’s like having the government subsidize a company like Walmart so that they can pay a price that’s too low. That doesn’t reflect the real cost of labor. So it basically pays for, if you distinguish between production and the reproduction of the workforce, it doesn’t include the reproduction of the workforce, obviously, it doesn’t include healthcare or retirement or any of that.
So how can that be possible? And in that case, I believe that in the case of Walmart, that minimum wage is definitely a solution. Now your question is probably that with self-employed people, there is no minimum wage because they charge their companies, they charge something. It’s a price. It’s supply and demand. And the things that were implemented for salaried workers do not protect the self-employed. There’s no minimum wage.
Now… that’s not entirely true, because the city of Seattle managed to make the concept of minimum wage apply to the self-employed drivers of Uber and other platforms there in the city of Seattle. So there are ways of doing it, so long as you recognize that freelancers are not exactly like any other corporation and that you can in fact transfer some of the legal apparatus, some of the legal framework that was designed for salaried workers. You can transfer some of it and adapt it to the world of freelancers to create new protections. So you can keep the flexibility to make the business model of companies somewhat viable. But some things that they do shouldn’t be possible because it doesn’t include the negative externalities that they create. And that’s just economic nonsense…
BR: And if we think about those new forms of organization, so you’ve mentioned one, which are platform companies. So platform companies increasingly coming to intermediate between consumers and freelancers. What are the responsibilities ,do you think, of those platforms? And then what are the responsibilities that they’re currently not assuming? And is that where the government needs to step into to regulate, to make sure that they do internalize those externalities?
LV: Yes, but it’s a complex question because in some cases, those platforms behave in every way like an employer. And then it’s a form of salaried work that maybe shouldn’t be possible. I say maybe because it really depends on the platforms and the work conditions. And if that’s the case, then it’s simple enough, I guess there are laws that are out there enough to just basically say that model is not possible. But in other cases, the platform is truly just an intermediary. And then if you give those platforms responsibilities towards the workers, then you presume that the platform is an employer. And if you do that, you create a form of subordination. You can make the platform give more benefits to the worker but that means that the worker will become dependent on the platform for those benefits.
But if they really want to be independent, they will want to have a business outside of the platform. Think of all the Uber drivers who want to have a business outside of the platform. They give you their business cards and they say, we can bypass the platform and I can make a great personalized service for you and take you to the airport and show you the sites and all of that. But if there are benefits attached to working via the platform, then there is no incentive for the worker to be truly independent and develop their business outside. So it would make more sense to create protections that can benefit all self-employed workers, s it’s not to create an incentive for them to work via platforms. Platforms can help them access a customer base they wouldn’t otherwise have. But the danger for them is to become too dependent on the platform to find those customers and to get benefits on top of it.
BR: So there’s a lot to unpack there. One question would be, whether you could have those platforms provide benefits in aggregate? i.e. You could have kind of benefits pot if you like, that sits outside of the platforms, but to which anybody who work, through any platform you work through contributes. That could be one answer. Or do you think that’s looking at it the wrong way round and it should be, the benefits should be provided by the state for example. And then they sit completely outside of the platform world. How do you see that?
LV: The incentive should be for the worker to charge enough so that the price includes those benefits… Ultimately the customer is the one responsible, but you’re right, the platforms do take, what is it, 25 or 30% of that price. So obviously there could be a way to make them contribute. It’s a large enough margin for them to pay for something. And if it’s an aggregate, then at least there is no incentive to work with one specific platform rather than the other, in which case you would emphasize the winner-take-all effect, by creating incentives for workers to work with the bigger platform, the biggest platform.
BR: You’ve written a lot about this idea of internalizing versus externalizing network effects, right? So not all platforms are created equal and some platforms are very good at helping to elevate this individuality of the freelancers that work through them versus the ones that commoditize the individuals who work for them, like Uber does, right? Because they call up a driver and the only thing that changes is the car, the rating, but you get no choices as the end consumer versus others where you know exactly who you’re contracting and they can charge a different price because they’ve got a different rating and so on. So is there some way for the government to enforce that, enforce or oblige platforms to share those things?
LV: Are you referring to the difference between aggregator and platforms?
BR: Yes. So the Bill Gates definition of a platform is an entity that creates more value than it takes. How do you get aggregators to become platforms and can the government do that through forcing to share data and ratings’ portabilities and things like that?
LV: Was it Ben Thompson who wrote this amazing piece about the difference between aggregators and platforms?
BR: It was, yeah.
LV: My piece was about platforms to empower individuals to basically show who they are and find customers to want them for who they are versus platforms who commoditize people where the customers basically buy your service rather than choose a person. And a good comparison would be to compare Deliveroo with Task Rabbit, two platforms that I sometimes use in London. So with the Deliveroo you purchase a meal and it gets delivered, you can add a tip because you know there is a human involved somewhere, but you don’t know who that is and you just add a tip because you are a decent person. And that’s the right thing to do. But basically you will barely even see the person. If it’s raining outside they will be wearing a helmet and you won’t even see who they are… versus Task Rabbit where yo do choose a category, let’s say you need people to do some housework and to repair furniture or to do some plumbing work or electricity work. You will choose someone with expertise. And in fact, you might even trust a profile, a person who charges a lot more than a person who doesn’t charge a lot. And there are huge differences in terms of how much they charge and for sure you choose a person rather than just a service. And then you might even get new ideas of things that they could do in your home if you need help. So that’s a huge difference.
BR: If the answer is turning aggregators into platforms and forcing them to share the network effects that they’re currently internalizing, can the government do that? Would it be enough to oblige them to share data, to force them to allow for rating sharing, could the government enforce that kind of change between aggregator and platform?
LV: When it comes to individuals… I’m not entirely sure how being forced to share ratings will have such a big impact and make it possible to turn aggregators into platforms. I don’t see it because when you look at Uber drivers or Deliveroo riders (by the way Deliveroo riders don’t even have ratings, do they?). This mark that you have that’s 4.7, 4.8, what kind of value does it have if you want to start another career somewhere else? Not that much. Unless it’s 4.999 or something, which case you just take a picture of it and that’s the data.
BR: But you can imagine the situation. So I take a point, which is all it does really is it helps you to get rides quicker on Lyft for example. Right? Which you’re right, there’s no panacea, but if they promoted the individual more, that you might have favorite drivers for example. So rather than just calling for a driver, you could offer a specific driver who’s got a really nice car. I mean in this city, it’s the ones that have the Teslas that you’d like to be able to call, right? Or really charismatic, like chatting to them or whatever. But none of those things are possible. So can the government from endogenously kind of enforce these changes on platforms?
LV: Forcing them to share data is always a good idea. But there are lots of types of data that can be useful for a number of reasons. Be it collecting information about the workers, knowing who they are, how they drive, why they do what they do, how many cars are out there, information data to help with public transportation services, to help with urban planning, etcetera. So there are many reasons to collect data better.
LV: I think you’re absolutely right on this. Data sharing would be a great thing. Allowing people to put their ratings would be a good thing but marginal…
LV: It wouldn’t be marginal in the case of Task Rabbit or LinkedIn or etcetera, but then there are already a few protections in place with the GDPR.
BR: It seems to me that if you really want platforms to operate in a different way, the economics have to be different. Right? And I suppose what you really need, if you take more macro views, you really need the consumers; I think you even said this, right? You need the consumer to bear the full cost of the services they buy. Because what we’ve really seen so far with everything you’ve talked about the unbundling and so on and the platformification of work and is a massive transfer of wealth from workers to consumers. There’s a brilliant report on Uber for example, it shows the massive amount of consumer surplus they’ve created. So the cost of the labour has gone down and therefore a massive surplus has been created other side, the consumer surplus, but then Uber has captured a small part, but not very much. Most of the benefit, the vice majority benefits the consumer. So what you really need is somehow for the consumer to pay more. And in a way the consumer by not paying full cost of services is hurting themselves because they’re also workers. So how do you do that and is that where the government can make more of an impact by trying to create some sort of pact between consumers or workers?
LV: Well, sometimes even of price control. I’m not sure I’m 100% in favour of the idea, I was being a bit provocative on purpose, but it’s a question that I never see out there in the open. And it’s not such a stupid question, in fact…
BR: Well in a way this move to craft goods and artisanal goods is that in a way, right? Because it’s almost like the consumer is prepared to pay much more than the marginal cost and is prepared therefore to subsidize people who want to pursue their passions. So how did The Craft Movement come about and how could it be extended to other things? Or does it just come back to the same point, which is… some people have skills where they’re in a better position to get fair value for those skills versus most people who are in danger of being commoditized?
LV: I don’t think that… or rather the idea of the vision that there are only the elite few who are creative and smart and basically you have the geniuses on one hand and all the other stupid people on the other hand. I think in fact, most people have some kind of unique, maybe skills is not the right word, but unique things that they can contribute, that they can give. Unique personality, unique network of individuals that they are surrounded by and it all boils down to the definition that you want to give of craftsmanship. If craftsmanship is making something beautiful with your own hands, then obviously some people would be better at it than others. But if craftsmanship is doing something in a unique way with autonomy, responsibility and some creativity making it yours, then there are lots of things that can be done… artisan-ly.
BR: There’s one last thing I’d like to get you on, when we talk about platforms, which is, have you ever read that… it was a brilliant article. I think it was in The New York Times and it was called The Spy Who Fired Me. So I found it through Tim O’Reilly’s book. I just think we should say one thing about platforms, which is they tend to quite often get a bad name for exploiting workers and so on. But his argument is that workers practices got a lot worse before platforms came along. And so The Spy Who Fired Me was all about the software that was introduced long before platforms came along, that recorded people’s hours and stop them ever crossing the threshold where they might have to pay them full social security and full benefits. So I just think it might be worth maybe just debunking some of the views around, because it’s not as black and white as all platforms are bad…
LV: Yes. The same is true about Amazon warehouses. I’m not saying it’s fun to work in an Amazon warehouse, but it’s exactly the same to work at the La Redoute warehouse. There was a case in France where a guy was fired for eating a tangerine at work. There were lots of headlines about La Redoute a few days ago in France and some people were surprised. They were like; oh I thought it was just Amazon, right? Or I thought it was just Deliveroo riders.
In fact, the truth is that a lot of workers, the hundreds of thousands of cleaning women working for service companies who work super early in the morning, super late in the evening with nothing in between. So it’s officially a part time job that they’re too exhausted to do anything else. Plus there’s no one to employ them in the middle of the day. And they have no social protection and are fully precarious… and they’re salaried workers and those are traditional companies that are in no way digitally enhanced. And likewise the new working class-the new urban working class-is full of people who don’t work for platforms and many of them are very precarious. And the working poor, the vast majority of the working poor in the US don’t work for platforms.
BR: Yeah. And in fact, there’ve been many studies that show in aggregate the platforms have created more employment than they’ve, quote and quote destroyed. And also that in aggregate they pay more than the jobs that they’ve displaced.
LV: What it reflect is that the balance of power between workers and employers has changed since the 1960s or seventies. And that’s the case everywhere. And except for a small niche of workers on specific skills like, computer developers and marketing specialists, the rest of the workers are not in the same situation anymore as their parents.
BR: Because of globalisation?
LV: Because of globalisation, de-industrialisation, the decline of labour unions, culture of individualism that weakened collective bargaining, because of lots of reasons, demographic reasons and immigration and…
BR: And if we assume that those trends that you talked about aren’t going to go into reverse, most of them aren’t going to go into reverse. What are the new sort of policy measures that need to come together or what are the actions that individuals need to take in terms of reskilling or whatever to try to improve pay and reduce precariousness? And do you think you will see return of collective bargaining, for example, is that going to come back or do you think we just have to equip ourselves as individuals with better skills and take more responsibility for our own retirement and healthcare costs and so on? So how do you see that playing out?
LV: I think training and re-skilling and all these things will be more and more an individual thing. But when it comes to healthcare for example, that’s not possible. When you look at the American model, you see that’s just not possible. You have individuals who will die at a young age because they simply cannot afford a $100,000 operation. It’s just a treatment that’s too expensive.
So some things cannot be completely dependent on individuals and we need some kind of institutions for that safety net. So how far should the safety net be? That’s a question that can be discussed. But I believe healthcare is not something that should be up for discussion because it just doesn’t work. It’s just a system where you have a lower life expectancy for the many and a higher life expectancy for the few and that’s not the society that I would want to live in. But for re-skilling and all of that, that’s a good question. We had a discussion before the podcast about the age of transitions and what it takes for individuals to be prepared for that age of transitions. And I mentioned to you the book of Lynda Gratton, The 100 Year Life, in which she speaks of a concept that I really liked, the transformational assets.
The transformational assets are a series of assets that we have that makes it possible for us to be ready for future transitions and to transform, take new turns, change careers, do new things. And what she says is that we’ve gone from the three stage model, life model where you had 1/ training first and then 2/ work for about 30 years and then 3/ retirement, to a multistage life with multiple different phases where you’re stretching that career the same way to 45, 50 years is just not viable because we wouldn’t be able to sustain it physically, mentally, emotionally, et cetera.
And so she says, we’ll go to a life of many transitions and probably have not only multiple jobs, but also multiple different careers, which will involve developing different skills, but also developing, building different networks and saving up enough money to prepare for these transitions. So there are also in these transformational assets, financial assets, that are physical assets, how resilient and strong you are. There are mental assets, how well can you learn new things and there are social assets, how strong are you and diverse of the networks that you have and how will they help you transition from one phase to another or from one job to another.
BR: But these transformational assets that you talk about, I mean this makes a lot of sense to me. You know, what are they? And these aren’t things that we’re currently taught or encouraged to develop at the moment, right? I mean encouraged to develop… so these are not things that we’re taught in school, right? These are not things that our parents are particulary atuned to…
LV: Well, when you look at parents today, they’re all obsessed with it. They don’t call them transformational assets. But why is the Montessori system so popular today? Why are all parents obsessed with that question? What kind of school do I need from my kids? They all know that that’s exactly what they need, even if they don’t use that concept. And the Finnish school system that recently did away with the subjects, with the school subjects like mathematics, history, et cetera, et cetera, they merged everything. And they did away with the whole concept of having different school subjects to focus precisely on different priorities. Like how resilient and empathetic and how strong will the kids be to create new and build new networks and how is their emotional intelligence and how can they learn to work together? How can they learn to learn new things all the time? So I think a lot of people and institutions are asking those questions, but they’re usually asking the questions for children, not for grownups!
BR: And outside of Finland. It doesn’t seem that schooling is changing very fast.
LV: It isn’t. And there’s still this obsession with the skills gap, the idea that there are needs on the market that are not satisfied because the school system doesn’t teach them enough. And there is this idea that there’s always a race you need to adjust the school system and create this one more class where they learn a computer language that will be useful in the market. And it never works because there is always a delay of two to three, to more years before the child or teenager is actually on the market. And it’s such a narrow view of matching….
BR: Is it a bit like the debunked industrial policy of the past, where governments would try to pick winners and by the time they’d identified what those winners could be, then the market had already moved on. Right? So it’s much better therefore to take this Finnish model of teaching, equipping people with the cognitive skills or whatever. Right? So they can adapt rather than trying to teach them specific skills for a specific purpose.
LV: Yeah. I’m a strong believer in developing cognitive abilities in general. And that can be by focusing on poetry or music. So if you can pick anything your child seems to be interested in and let them spend the time they want on that… and it can be music, it can be joying or poetry. I think these things will be in the direction of more creativity and also discipline that the mental discipline… Yesterday we talked about the 10,000 hours that you need to master a subject or a trade. If you want to be able to play the violin, you need to invest 10,000 hours but the problem is before you invest these 10,000 hours, you need to want to have the kind of discipline where you will actually practice again and again and again. How do you get a child or teenager or an adult to have that kind of discipline, that kind of focus to be able to do the deep work or deep learning that will make it possible for you to learn that craft?
BR: So just to revisit that idea of the multistage life, because implicit in that idea is that people will be switching jobs much more often, but are we sure they’ll actually be lots and lots of jobs in the future? So, in other words, much more simplistic question, are we confident that we won’t just automate away all jobs? Which is, a dystopian view of the future which you don’t subscribe to in your book…
LV: I definitely don’t subscribe to it because I write a lot about these proximity services that include cleaning services, nursing jobs, and the like. People will help the elderly remain at home. People will cut hair. Of course you can have a robot to cut your hair, but that’s not the reason why people go to have their hair cut. They go to have their hair cut, not because they want the haircut, but because they want a massage and they want a conversation with the hairdresser. Basically all of these things are not something that can be automated because… you don’t need these services, the services themselves… but for all of what they entail. And that’s basically companionship. Being with someone and having someone to help you and so all these things. There are many reasons to believe that there will be a strong multiplication of those jobs.
First the population is ageing and we know there will be more people who will be dependent at some point, more people who will have handicaps. We know that we will consume more and more services. When you look at the way the rich consume today, they like to spend their money on experiences; they like to spend their money on yoga lessons. If you look at the job market and you know that lifelong training for all the reasons that we mentioned will become more of a thing then that means there will be more and more services associated to lifelong training… and training in general. So all in all there is a lot of certainty that there will be a lot of needs in that area. And a lot of these things, even the most simple things like cleaning and helping an old person at home.
We’re so far from being able to automate it. So I generally get this idea of making tea. Making tea is super tough because no kitchen looks alike, you can have a super small kitchen and then you have to find something that looks like a teapot. And that we know from the technology point of view, that’s actually super hard, right? Because something that looks like a teapot can be something that’s not a teapot, if you don’t have a teapot. You have to find a tea. You have to ask the person what tea they want. I mean so many different little things that right now we don’t have a robot that can do that. And I’m pretty sure that 10 years from now we won’t either. I don’t know about 50 years from now, but for the foreseeable future, that’s not something that’s automatable. And then again, that leaves out the idea that in any case, what we need is companionship and not the service itself. We need both together. So I’m quite certain that there is a vast number of jobs that will be created in proximity services. The problems are many. Well, the difficulties are many.
BR: So maybe take them in turn. So I think one of the challenges is the way that those jobs are perceived, right? So often they are perceived as either service that should be given for free, right?
BR: In a lot of cases. And then where that’s not the case, they’re quite often perceived as jobs that are done by females, for example and also they tend to be very poorly paid jobs, right? So how do you address those things? How do you get that kind of proximity work to be well-paid or paid at all if it’s unpaid. How do you get men and women doing those types of jobs?
LV: The reason why they’re so poorly paid is that to this day the confusion remains between unpaid labour and paid labour when it comes to proximity services. Because probably more than half of the work is today still performed for free. So if you iron your own shirt, it will not be a part of the GDP. Whereas if you have your cleaning woman do it, or if you bring it to someone who will do it for you, it will have a price and it will be part of the GDP. So obviously it’s very artificial because in terms of the product or the service being done, in both cases you have an iron shirt, but in one case it has economic value and in the other it doesn’t. And this confusion is so strong in every little activity that used to be performed exclusively at home, that it affects a lot of the jobs that are still on that line, on that blurred line.
So throughout the 20th century, a lot of these activities were externalised outside of home or you had someone external doing it at home. But anyway, a lot of it entered the GDP, but it entered the GDP on the basis that it was something that had to compete with the price of zero. So that makes it a little bit hard to price it higher but there is such a high demand for these services today that the prices are bound to go up and there are already going up for a lot of these services. Again, in the U.S., it’s very hard to hire cleaning women, especially because Trump closed the borders and there are fewer Latinos coming over from Mexico and it’s super hard to hire new people. So the prices are high. Same is true in Paris. If you hire someone individually, it will be priced high and the prices will go… or sometimes maintain low because workers doing them are not a workforce who communicate with one another and can negotiate collectively. So they have no history of building unions and negotiating collectively. So they’re in a position of weakness with employers, companies or individuals who are in a position of power.
And that’s changing too because obviously with digital, all of a sudden there are ways of talking with your fellow workers that didn’t exist before. And so the new unions that are being invented today are being invented in domestic services. And one of the fastest growing union in the U.S. is the the American Domestic Workers Union that has the support of the Hollywood actresses like Meryl Streep… that walk on red carpets and are on TV all the time. So I think that prices will go up.
BR: But prices are going up because demand is going up and supply is not going up. But supply would go up if you could get men to do these types of jobs. So how do you change the perception that these are jobs that are done by women and do you agree that if that were to happen then you might see more pressure on pricing?
LV: But if that were to happen, you mean if men were to join so-called female jobs in force, then prices will not go down. Prices will go up. Look at what happened to IT people, when women were computer scientists in the 1950s, it wasn’t a job that was valued much. And when women were pushed out of these jobs, suddenly the jobs were paid much, much more. And it’s happened with a few professions and you can be sure that if the profession becomes more male, then there will be stronger unions and somehow it will be valued more because it will also change the perception of value. And that’s the challenge; it’s a chicken and egg problem. It’s seen as having no value. And that’s why men don’t go. If men were to go, value would be perceived as higher.
BR: So I’m happy that you challenged the premise of that question, but also in a way you kind of answered it right? Which is you think that if the work becomes better and better paid, that will attract men into the work.
LV: That’s the idea that at some point this identity issue of male factory workers saying, I can’t be a nurse cause that’s a female job. At some point this identity issue will be overcome by the attractiveness of the new job if it comes with better benefits and better pay.
BR: What about geographical mobility? So, if you assume that we’re going to see a big boom in proximity jobs and those proximity jobs will eventually appeal to male workers as well as female workers, then you should see a big shift in the population, right? From areas that have been de-industrialised for example or for whatever reason have suffered economically towards the booming urban centers, where people want those proximity services. But you, yourself, earlier in this podcast said that the urban centers have been priced out of the reach of most people. So how do we overcome that? How do we make it possible and feasible for people to move to cities to do these proximity jobs?
LV: A number of things, not one solution only. There’s definitely, again, government stepping in or city stepping in with more social housing in areas where there’s lots of social housing, there are more mixed groups and it helps everyone. So that’s one thing. Then you have obviously companies. Employers, in some cases employers can offer housing too if they want to attract the people they need.
BR: That takes us back to industrial times doesn’t it?
LV: Exactly! It was a thing of the past but it’s also the thing of the future because look at San Francisco schools today, some of them cannot attract teachers because it’s not paid enough for them to afford a one bedroom apartment in San Francisco. And basically they have to put housing in the package if they want to recruit people. Again it forces to put more value and increase the price of labour directly or indirectly. Directly it’s pretty obvious that if you’re paid more than you can afford to live there. And that’s what you see in cities like Copenhagen. A cleaning woman earns enough to live in Copenhagen… and Copenhagen is expensive. Very, very expensive.
BR: So same thing ultimately, which is supply and demand will bid up the wages of people so that they can live in the city center, aligned with the fact that corporations and governments… we’ll have to also take steps to make it easier…
LV: And also, but there are more things, also obviously public transportation cause now there’s no, you could live a little bit further if it’s easier and convenient to come. If the commute is not hell then why not? And that’s definitely something that more cities needs need to consider. And last but not least, the organisation of work itself. If you allow for more flexibility, then you can have people who work 20 hours in two days, sleep one night on a couch and go back home the rest of the week and do something else with their lives. And that is going away from the nine to five jobs and from this organisation if you’re working from Monday through to Friday. I have another thing to add, is the idea of making the job more valuable through craftsmanship by adding more tasks that bring more value. If again you take this example of the cleaning woman, if she doesn’t only clean but also manages the household and become a sort of governess and does more and more and why not also accounting for the household. Then you have a job that’s much more quantified. Yes. But they would be paid much more.
BR: I am so pleased that you brought up the topic of the organisation of work because that’s a beautiful segue to what we want to cover next, which is how corporates adapt. So how do corporations adapt to this new world where they’re going to be working a lot more with remote workers, freelancers? Maybe putting it a different way. The sort of old world of command and control I guess is not possible. And then we moved to a world of sort of pay setting based on KPIs. What comes next? How do we manage people? How do we judge their success in a corporate setting? What does the corporation of the future look like?
LV: The future of the corporation is already there and a lot of companies have workforces that are composed only partly of an internal workforce that is composed of salaried workers. And the rest are consultants or interim workers and freelancers and people who work for service companies providing cleaning services, providing accounting services, providing… you name it, lots of services that are performed within the company, but these workers do not have the same employers as their colleagues.
BR: Do you have statistics on that? Because, while I can think of examples, it doesn’t feel like it’s as pervasive as your suggesting.
LV: Precisely, we do not have reliable statistics because the statistics on workers focus on the traditional relationship between an employer and a worker. And the rest is basically suppliers, the world of suppliers. And among the things that you purchase as a company, there are services, there is software that has embedded work in it, but it’s software, right? And you have sheets of paper that you use for your printing machines and you have furniture and whatever and all these things are things that you purchase. So in terms of accounting, it’s not the same thing but the reality behind the things that you purchase is that some of those services are actually performed in the company and in place of a salaried worker who could do it for their employer directly, and you have sometimes side by side different workers doing more or less the same job, but they don’t have the same employers. They don’t have the same benefits; they don’t have the same working conditions.
BR: And what does good look like in this new world? Because who does this well? Cause it a little bit of what you’re describing there is just, the model of sort of outsourcing, right? So that corporations have a blend of their own stuff plus externals. But to some extent they’ve done that for a long time to save costs. And it seems to me there’s a way to really capitalize on this shift to get access to the best workers and to manage them differently. So what does the corporation of the future look like from a structural point of view? And how do they manage remote workers?
LV: It’s a company that doesn’t have silos that don’t communicate with each other. One that’s in charge of purchasing, the other that’s in charge of HR. Basically Human Resources is something that’s much larger than the current definition of Human Resources. And if you don’t have a strategic vision of, you know, talent management and recruitment that includes hiring freelancers for short time or long term missions, then you don’t have a good view of HR.
So some companies, small companies started to do it well, because they have, they work regularly with freelancers who they know are very valuable and they don’t find it taboo to speak of onboarding a freelancer. And sometimes they’re even treated like a team member. And the only reason why they’re a freelancer is because they don’t want another type of contract and because want to maximize their gains or keep their freedom or whatever. And so some companies in a very rational and realistic way have a good view of that but usually there are smaller companies or younger companies and the very large organizations still have silos and they still have these metrics, these accounting metrics that separate things. And for them it’s taboo to say you need to consider how to onboard a freelancer, even though you actually have to.
BR: A lot of people are fascinated by Haier, a Chinese manufacturing company, they’ve organised work in a very unique way. I don’t know if it’s holacracy, but it’s this idea that they’ve devolved a massive autonomy to every individual in the organisation. So everybody has skin in the game. Is that the kind of model you’ll see in the future where the corporate itself is really only sort of a facilitating body rather than actually setting very concrete tasks and....
LV: A sort of hub or platform where employer branding and consumer branding is the same thing and where all of the lines are open. Well that’s the idea. And many companies pretend that they’re in that vision of things. And the whole phrase is, I think it was Google — Act Like An Owner — with this idea that workers should have equity because otherwise we’ll never act like owners and the owners that they should be and for them to be innovative and entrepreneurial enough for the company to move ahead. You need them to have a stake in the company. Of course, the reality is that Google became a huge corporation where people do not really act like owners and where there is division of labour and subordination, but that’s another matter. At some point when you grow and grow, can you really, really remain agile?
BR: And if holacracy is even the right model, how do you get something like that to scale? Haier is fascinating but I think the reason everybody talks about Haieris because it’s pretty unique right now. I mean there aren’t, I don’t think we can think of hundreds of examples of companies that are doing this on that scale.
LV: I have the same problem with liberated companies and Teal Companies, which is the concept used by Frederic Laloux whose book I love very much.
BR: What’s it called?
BR: Is it available in English?
LV: Yes. It was written first in English and then translated into French. So Teal organizations, liberated companies and holacracies and all these things about new governance and having workers who act like owners, the same thing bothers me that bothers you. It’s always the same examples that are given, always the same company. So holacracy, there’s always an article about how it felt, how Zappos, the company’s Zappos that was purchased by Amazon made it famous. And by the way, Zappos is no longer holacracy, sadly. So there are very, very few examples out there and even fewer of companies that are large and that can provide a model for other companies and let alone super large corporations who need to transition from one model to another. So the best examples are usually medium sized companies, that had a governance model from the start where people were more autonomous and this model has been proved effective in many different places, in many different sectors. And there are more such companies than we know of because we only know of the companies that were in those books that we mentioned.
BR: But I think the thing that’s probably repeatable about Haier is that it sort of decomposed itself into small units.
LV: They are more organic, like cells and organisms.
BR: Exactly, a bit like a federated governmental structure. This same idea, which is the head office department, is super small and it’s just facilitating the activities of a very large number of small cells.
LV: Exactly, that’s the model of Frederic Laloux’s Teal organization where the metaphor is of a living organism. And when you have different cells, they have the flexibility to grow organically and evolve like DNA in a way that’s much more adaptive, than the machine of the large corporation of the Fordist age and the metaphor for the large corporation of the Fordist Age in the Laloux’s is that of a machine. You have cogs in well-oiled machinery and not cells in a living organism and in a living organism each individual in that cell mirrors microscopically the cell itself. So it’s also a living organism that exists in its entirety and not just a cog with one thing. So it’s just a beautiful metaphor that probably speaks a lot to people who want to think about organizations and, and philosophize about it.
BR: Yeah but again, difficult to codify…
LV: Difficult to codify but the examples that are given by Laloux and there’s this famous Dutch company called Buurtzog, which provides a nursing services, nurses who provide services at home and who unlike in other companies are fully autonomous and can develop that very special, unique relationship with their patients. And they see those patients again and again. And it’s part of the treatment that they have this level of attention and care that someone just given a shot once in a while will not be able to develop. So it’s a very successful company that’s launched in several European countries.
BR: What happens to the corporations that are still run like machines? Will they become obsolete and be replaced by companies that are much more flexible and adaptive and how quickly will that happen because change happens normally slower than people expect?
LV: Well the problem is that there is no free market. If there was a free market, they would at some point be replaced. But there is no free market. And most sectors, these large corporations are rent seekers that build very high barriers to entry or even barriers to exit to keep their customers. I’m referring to banks obviously for example, but in lots of sectors you have barriers to entry, you have strong lobbying, you have situations of a rent. And so even though they’re not agile, even though the design is bad and there are better places out there doing it better, it will take a long time for these large corporations to be fully replaced by smaller, more agile ones.
BR: We’ve been talking about the different stakeholder groups that are affected by all the changes in the future work. So we’ve talked about platforms, we’ve talked about individuals, we’ve talked about corporations, we’ve talked about the state. What about startups? What role does startups have in reinventing the Future of Work, either directly by introducing new employment practices and the kinds of things we talked about or indirectly through innovating new structures and new institutions, helping people to rebundle the bundle if they’re in financial services, for example, what role do startups have?
LV: There are a number of startups out there who developed services for the new type of workers who fall through the gaps of the current safety net. Who have no access to housing for example or no access to training because they don’t fit in the right boxes. So there are many companies doing it and, and together they, they provide some form of a bundle. In some cases there is only so much they can do because again, health care and housing, etcetera, it’s not something that can be done by a startup alone. But I’m very optimistic that some great services would make it easier for at least some of the most well off freelancers to have access to all of the bundle. You know, at least some of the most obvious things that can be done, are done and will be done thanks to innovative startups that provide new services.
BR: I think the reason to be optimistic is that the situation is so acute for so many people right now that we’re building services for really quite dire situations. So that if we can solve the bigger problem of actually raising these individuals income and we’ve built the whole set of new services for them, then things could get much better quite quickly.
BR: It seems like no conversation on the Future of Work could ever be complete without talking about Universal Basic Income. So just for completeness, I feel we need to cover it up. Where do you stand on Universal Basic Income because a lot of people put it forward as exactly the right solution, to go back to, to revisit this idea of the multistage life. So between those stages of life, you will have periods of no income because you’re changing jobs, you’re re-skilling, you’re moving. So if you set it against that multistage life, it’s at least intuitively a very appealing idea. Right? Or it seems like an elegant solution but the counter argument is that it’s just… it’s a way too simplistic solution to what’s a very complicated problem of low income and unbundling of benefits. And so where do you stand on Universal Basic Income?
LV: When I left the American Tech Company that I worked for, I negotiated two months of salary and that was it. And it was so stressful because I had to create a business and make it viable in about three months. That’s the time that I had. And I was very, very jealous of my French friends who have these unemployment benefits that when they leave their companies, even willingly, they get 18 months of revenues, good revenues. And they have the luxury of training for a new job, starting a business, taking their time, learning new things and even traveling a little bit before. And I was very envious of them. So the unemployment insurance system in France is a system that’s made it possible for so many people to transition from one job to the next and it’s amazing. And yet it doesn’t really solve many of the problems that we have. Cause the people who transition well because they have these revenues, they know what they want to do, they have the right connections, they get the training, they have housing, they have all these things. And for many people the problem is not just the revenues to survive but the connections to reinvent themselves and do something new. The training, the housing to be with the job is, the healthcare insurance if they have diabetes or are likely to get cancer in five years, the school system for their children, if they have to move with their children and the list goes on. And basically money is just for food when you have all the rest, right. So it’s not enough and it’s just survival. So I’m very much in favor of if this income when it’s combined with the other things that make it easier for people to transition from one thing to the next and find meaning in that professional lives.
BR: Do you think it risks being a distraction? If we boil it down to something that is too simplistic, then we fail to have developed the imagination to solve all the other problems. Do you think it risks?
LV: That’s exactly how it’s sold by libertarians. It’s like, it’s so much easier, let’s not bother with the rest of the social protection institutions that we’ve inherited from the past. Let’s give everyone a sum of money and then we can have basically no government services anymore. And of course it just doesn’t work.
BR: We’re almost out of time. So this is my last question. So I would very much encourage everybody to read the book. It’s a brilliant account of how work has changed and will change in the future. And as we said before one of the best things about it is it’s pretty optimistic about the future. But having said that, we’ve discussed all of the sort of changes that need to happen to the institutions, or the incumbent institutions, whether it’s the state, existing corporations, individuals about how they need to adapt to this new world. So there will be necessarily a period of transition. And so my question to you is that even if we’re optimistic about the future, which I think we both are, can we get through this transition period without civil unrest?
LV: We’re seeing civil unrest out there so I’m afraid if we just look out the window, I have to say we are going through a period of rise of populism and unrest and so I think the transformation will happen with a strong crisis that has many dimensions. Sorry, that’s not an optimistic answer, but there will be a lot of pain.
BR: And how quickly can we manage the transition, do you think?
LV: Hopefully the more pain, the quicker.
BR: Laetitia, thank you so much for coming on the show. We’re going to tweet a link to the book and we hope as many people as possible will buy it and read it. So thank you very much for coming to Switzerland. And, and sharing your vision about the Future of Work.