The amazing truth about work in the 21st century.
I got a call from friend a while back. He’s well educated and experienced but is not able to find traditional job. He is very disappointed because the dream jobs for which he is fully qualified generate nothing but rejection letters.
It’s been months and he has yet to get an interview.
He believes what he hears in the news and thinks that tons of jobs are created every day and sooner or later he’ll get hired.
I try to tell him that the labor market is much different than when he entered it twenty years ago. The numbers he sees in the news don’t reflect what is really happening.
He doesn’t want to hear it.
“But we recovered from the Great Recession” he says, pleadingly.
The economy never recovered. The labor market, jobs, the economy — everything is very different from what they were before 2008.
The way we define jobs and measure unemployment has changed. Work is not the same thing it used to be, and economists are having a hard time defining and measuring jobs, work and employment (GAO 2015).
Before the Crash of 2008 having a job meant you could afford rent or car payments. No longer.
Yes, we have an unemployment rate of about 3.5%. But at the same time about half the people in the United States make less than $34,000 a year (U.S. Census Bureau, 2020a).
Even though people are counted as having jobs, they are paid so little that it’s not like having a real job.
The hard truth is that old fashioned jobs are quickly being replaced by “gig jobs”. According to one research paper, 94% of the jobs created between 2010 and 2015 were gig jobs (Katz and Krueger, 2017).
Even if that number is way off, the growth of gig work is transforming jobs and work…
For one thing, these are not really jobs in the way we used to think of them. They are low paying temporary gigs that are often part time, without benefits or job security.
Economists call this “contingent employment” because these jobs depend on unpredictable events for their existence.
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Constantly changing customer demand often determines income. People working these gig jobs are never sure how much their paycheck will be or how long their job will last. They struggle to find housing, they put off marriage and children, and certainly don’t have savings or retirement accounts.
Meanwhile, the other half of the country making more than $34,000 are doing much better.
Their average individual income is around $50,000 a year, but many make far more (U.S. Census Bureau, 2020b). They work at jobs that usually provide health and life insurance, they can save for the down payment on a home, can afford newer cars, and are confidant their financial situation will not suddenly change.
So, what happened? There used to be enough work that just about everyone could have a decent income.
The short answer is that there is not enough work to go around.
Computers and software have replaced a huge number of jobs. The myth that technology would produce more jobs than it eliminated is now obviously exposed.
That idea never made any sense anyway.
Technologies requiring expensive human intervention are hugely inefficient. The only way technology can increase efficiency is to decrease the need for human involvement.
And that is exactly what is happening. Computers and robots have replaced mass employment that defined the industrial age.
Companies no longer see their stock market valuation increase when they announce they are expanding. Now they make huge profits on the stock market when announcing replacing workers with machines (Lazonick, 2017; Foroohar, 2016). Fast food jobs are being taken over by robots, and so are professional occupations like attorneys and pathologists (Susskind, 2020).
So, what to do?
The concept of a job has changed in the last half century, but that does not mean that the opportunity to make a living and derive joy and identity from work has disappeared.
The way we get jobs and express them through work is the major change we now face.
We can no longer look for someone to “give” us a job.
Standing forlornly, resume in hand, waiting for someone to notice us and pay us money in exchange for renting our minds and bodies no longer works.
Instead we need to seek out opportunities and exploit them for our own gain. We need to consider where our skills and talents lie and how best to exchange them for value.
And that opens the door to creating the kind of “work-life balance” that is at the top of list of needs traditional employees yearn for. Work no longer has to mean sacrificing what is important to us for the good to the company paying us. A gig economy allows us to integrate work into our life in a way that best suits us.
It will be much easier to chart our own course and define life goals and success in ways that matter to us. We will have the choice to decide who our customers are and how we please them. The days of being judged on how closely we conform to pointless bureaucratic standards by authorities higher on the corporate hierarchy are coming to an end.
We will need to question the lifestyles we thought we might live.
Why do we need a 3000 square foot house? A status symbol to show others how much money we make? Maybe that’s an industrial age anachronism. The status symbol of a gig economy might be the quality of the work we produce.
Or maybe the joy we take in our work.
Maybe one of the new “tiny houses” would suit us better. After all, what do we do in our homes besides eat, sleep and cruise the internet? And if you live in a smaller house why would you need an energy hungry big screen TV? Any why watch TV? If we can construct our own lives to be fulfilling and rewarding there is little attraction in watching other people live their lives.
The future of jobs is something other than a spending a predictable amount of time in a predictable location. Some people’s skills and abilities might require daily high mobility, while others can work from a laptop just about anywhere.
Do we really need to burn enough fuel to move a two-ton SUV just to carry our 200-pound body across town? Even if we add a few 50-pound kids it seems like an extravagant waste. A small car, ride sharing or motorcycle might make more sense.
We have choices to make.
We can clutch old ideas and expectations from the economy of the 20th century and try to make them fit into the realities of the gig economy of the 21st century. But that would be just as arduous, painful and pointless as trying to fit a size 10 foot into a size eight shoe. It can be done, but would not create an attractive long-term lifestyle.
It takes courage to challenge our tightly held beliefs, look for new opportunities and set a course for a new way to live.
But the, that’s what humans have been doing ever since they have been humans.
Embracing change is in our genes.
Foroohar, R. (2016). Makers and takers: The rise of finance and the fall of American business (First edition. ed.). New York: Crown Business.
GAO. (2015). Contingent Workforce: Size, Characteristics, Earnings, and Benefits. (GAO-15–168R). Washington DC: GAO Retrieved from https://www.gao.gov/assets/670/669766.pdf.
Katz, L. F., & Krueger, A. B. (2017). The rise and nature of alternative work arrangements in the United States, 1995–2015 (2016). The Global Talent Competitiveness Index, 2016.
Lazonick, W. (2017). The New Normal is “Maximizing Shareholder Value”: Predatory Value Extraction, Slowing Productivity, and the Vanishing American Middle Class. International Journal of Political Economy, 46(4), 217–226. doi: 10.1080/08911916.2017.1407736
Susskind, R. (2020). The future of the professions: How technology will transform the work of human experts, updated edition (New product edition. ed.).
U.S. Census Bureau. (2020a). Real Median Personal Income in the United States [MEPAINUSA672N], retrieved from FRED, Federal Reserve Bank of St. Louis; https://fred.stlouisfed.org/series/MEPAINUSA672N, March 3, 2020.
U.S. Census Bureau. (2020b). Mean Personal Income in the United States [MAPAINUSA646N], retrieved from FRED, Federal Reserve Bank of St. Louis; https://fred.stlouisfed.org/series/MAPAINUSA646N, March 3, 2020.
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