The Cost Of Being An Employee
“Give me a lever long enough, and I shall move the world.” That’s Archimedes. It would take us another 2,300 years, but eventually, we invented the lever. The internet has changed our economy and society more than any other technology before. In The End of Jobs, Taylor Pearson explains how it’s transformed the job market in the past 20 years.
The book is divided into five sections, the first two of which describe the demise of traditional jobs; the last three make a case for being an entrepreneur. To me, it creates a picture of a scale that’s slowly moving from very imbalanced to almost tied, maybe even slightly tipped towards the new side. As such, I think the central message is this:
The gap between entrepreneurship and traditional jobs is closing.
Broadly speaking, Pearson describes this gap in three aspects:
- Value for the economy. Large corporations still pull their weight, but add less and less to innovation, especially in the tech, software, and internet space. Meanwhile, one-man shops and small startups unlock value in markets that weren’t profitable before.
- Value for the individual. Manual labor is automated or shifted to where it’s cheap, leading to salary wars among traditional firms. But with an internet connection, anyone can run a small e-commerce business on the side, yet still make an extra annual salary.
- Risk taken on by the individual. Corporations require neat CVs, expensive degrees, yet often only offer temporary positions. The cost of setting up a website is less than $100 and you can get most resources and services on demand, just in time.
For traditional careers, value goes down, while risk goes up. The opposite happens to entrepreneurship, because after the dot-com boom (and bust), it’s become the limiting factor in pushing humanity forward.
“1. The limit is shifting from knowledge to entrepreneurship. The entrepreneurial Complex and Chaotic domains are the ones increasingly in demand.
2. The dominant institution is shifting from Corporation to the Individual (or self). What used to require large companies, technology, and globalization has now been made available to the individual or micro-multinational.
3. The dominant player is shifting from CEO to Entrepreneur.”
But what does that mean for you and me?
Not All Entrepreneurs Make The News
If Pearson’s right and if the trend he describes continues, a lot of people are building the foundation of their career in the wrong sandbox. The internet has driven down the cost of producing goods and distributing them to almost zero, while good jobs are increasingly rare and harder to get into.
Pearson recounts a conversation with a business owner:
“He’d always loved cars and spent time at the race track growing up. He had a moment of realization when he saw that the only way he could ever race consistently was if he became an entrepreneur. In order to race cars, you need lots of money and lots of time. While a high-paying job in finance may get you the former and a beach bum lifestyle may get you the latter, it was only entrepreneurs that had both money and time.”
While the rewards of successful entrepreneurship have always been lots of money, meaning, and freedom, the risk to become one has never been lower. The first part is plain to see. Idols of entrepreneurship are all over the news. But there are no reports about the stay-at-home mom who sells Pinterest marketing services for $100k/year. This second part, the absence of risk, is much less obvious, which is why most people stay on their traditional path.
But however quietly, entrepreneurship, both part- and full-time, becomes the more attractive option with each passing day. And the question isn’t really whether you should start thinking about your options, but how long you can still afford not to.
Walking Up The Stairs
If you’re a startup founder, solo entrepreneur, or freelancer, you’re already taking some or all of the steps Pearson suggests to help future-proof your career. But if you’re a traditional employee, or on track to become one, slowly wading into entrepreneurship may be more appropriate for you.
“The entrepreneurial leap has become the entrepreneurial stair step. The latent demand and lower barriers to entry have allowed more people to become entrepreneurs by easing their way into the process. That’s not to say it’s easy — you still have to climb the stairs, but no longer in a single bound.
Stair Stepping lets you build momentum behind your trajectory by developing the skills you need to run an entrepreneurial company.”
The idea is to launch a simple product, like a Wordpress plugin, for a fixed price, and promote it through a single online marketing channel. Once you’ve hit a certain revenue threshold, let’s say $1,000/month, you can repeat the same process until eventually, you’re making enough to quit your job. Slowly adding channels and products will also help you build your skillset one step at a time.
The final step is to use your time, once you have all of it back, and any excess capital from your mini businesses to build whatever you want. This is a much better position to launch moonshots from than diving headfirst into a VC-backed venture or betting on a line of work that might soon be obsolete.
It’s 2018. The lever is long enough, but you must stand in the right place to apply it. Only then can you move the world.