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Traditional employment was not designed for the hyper extremes of ability, access and resources within networked societies.
- “…In 1990 GM, Ford, and Chrysler brought in $36 billion in revenue and hired over a million workers… The big three today — Apple, Facebook, and Google — bring in over a trillion dollars in revenue and only have about 137,000 workers…”1
- India has 1,000,000 people a month entering the workforce.2 3
The conundrum is this: Productivity is going up, requiring less people, but the global population is growing, meaning more people. And productivity gains are by and large concentrated in a minority of highly talented workers. This is not the first Gilded Age, but this is the first Gilded Age where the 91% of us with a cell phone can bear witness to the gilding.4
Social stability in the United States (and many other places) is built around the idea of stable employment and the ability to move up in the world. Be born, go to school, get a job—only then is the middle class promise of financial stability supposed to kick in. In the U.S., healthcare and retirement are designed to be taken care of through employment. Even the path to obtaining homeownership financing begins with W-2s5.
But what happens when economic transition becomes the new normal? The percentage of people participating in the workforce has been trending downward since 2000.6 And youth (15 to 24 years-old) workforce participation in the United State peaks at 60%7, which means a significant percentage of youth don’t have the experience of employment at all. And even when employment is achieved, other issues emerge. In the United States, 30% of employees are engaged in their work, 52% are not engaged, and 18% are actively disengaged.8 The bad news is we are only 30% efficient using the tool of employment to activate human talent. The good news is there is a lot of room to improve productivity by increasing the engagement of workers. But even if we put engagement aside, having a job does not promise opportunity. Workers are not seeing a return on their investment even as unemployment drops, which in theory should tighten the job market and raise wages.
Does employment look promising in this chart?
How about this one?
In summary, a decreasing percentage of people are participating in the workforce, many youth have no experience with jobs at all, the majority with jobs are not engaged in their work and those who are employed are not seeing a bright future.11
The challenge before us is to create the systemic and institutional structures that better activate and stabilize workers. And the first step is to consider what economic participation that does not assume traditional employment is the primary path to financial stability looks like.
Questions for further consideration:
- 3.1 What are the implications of increasing financial volatility for a growing segment of workers?
- 3.2 What opportunities exist because of increasing financial volatility?
- 3.3 What alternatives to stable employment already exist and what can we learn from them?
- http://www.businessinsider.com/technology-is-destroying-jobs-and-it-could-spur-a-global-crisis-2015-6 ↩︎
- https://www.youtube.com/watch?v=6_CDBJfIUBw ↩︎
- This is of concern for every nation as mass migration across great distances has been enabled by globalized communication and transportation systems. Most assume technology will move the work to the workers. Few consider the implications of technology enabling the movement of people to where wealth resides. ↩︎
- http://www.pewresearch.org/fact-tank/2013/06/06/cell-phone-ownership-hits-91-of-adults/ ↩︎
- https://en.wikipedia.org/wiki/IRS_tax_forms#W-2 ↩︎
- http://data.bls.gov/timeseries/LNS11300000 ↩︎
- http://www.bls.gov/news.release/youth.nr0.htm ↩︎
- http://www.gallup.com/services/178517/state-global-workplace.aspx ↩︎
- http://www.nytimes.com/2015/11/01/sunday-review/the-mystery-of-the-vanishing-pay-raise.html ↩︎
- http://www.nytimes.com/2012/12/12/opinion/global/jobs-productivity-and-the-great-decoupling.html ↩︎
- It is at this point the political obsession of job-creation needs to be questioned. ↩︎