“Every county … [is going] to have to reinvent itself. Each place has its own assets, and you need to figure out how to manage them” – Steven Connelly, Former Mayor, Berea, Kentucky
Over the past five years, the focus of “future of work” literature has shifted from a narrow emphasis on “jobs at risk” due to automation to a broader consideration of the impact of technological change and actions required to adjust to the transition that is underway. The discussion is beginning to focus on the timing and duration of the disruption in the job market, likely rise of non-standard forms of employment, widening of the divide between elites and the rest of us, transformation of the educational system to support lifelong learning, need to strengthen worker protections, and efforts to improve safety-net programs. The underlying theme in the literature is that we need solutions versus agonizing over whose estimate of the jobs that will be lost is correct. In spite of the supposed “Great Jobs Boom” that is being experienced in the U.S., and most of the developed world, it will not last forever.
Since 2013, the year Frey and Osborne published their study concerning the risk posed by automation, 15.8 million jobs have been added to the U.S. economy, the current unemployment rate stands at 3.7% and unfilled positions exceed unemployed individuals by 1.6 million openings. While the overall performance of the labor market calls into question the bleak outlook for the “future of work”, the underlying data suggests a different picture. Here are a couple of data points.
- In spite of a strong U.S. labor market, segments of working-age Americans remain marginalized, especially men ages 20 to 54. After peaking in 2000, the civilian labor force participation rate has declined to 62.8%, the lowest in 40 years.
- Since 2013, highly routinized, low-skill jobs have shrunk as a percent of the total U.S. workforce leaving fewer options for workers on the lower end of the spectrum, with many of the remaining opportunities at wages that are substantially below the national average, e.g. home health and personal care aide.
- While jobs are plentiful, the Department of Labor statistics indicate regional disparities. In 2018, 32% of the counties in the U.S. experienced a decline in employed individuals during a period which 2.2 million jobs were added to the U.S. economy. This phenomenon, the “disappearance of prime working-age workers”, is depriving large swaths of the U.S. of a stable workforce that would attract employers and fuel economic growth.
- Over the past ten years, 53% of the counties in the U.S. experienced population declines. In the past year, average wages have fallen in 16% of counties. These trends are contributing to the economic headwinds that are affecting employment at the local level.
- In spite of a significant increase in Americans with a bachelor’s degree or greater, sufficient “good” jobs are not available to absorb those with a higher level of education. Today, we “have a huge number of students graduating with debt and degrees they cannot monetize because the skills they were taught are outdated and irrelevant”. The rate of underemployment for recent graduates is close to 45%.
While there are many factors that determine current and future employment levels, the mathematics of place suggests that we have already entered a “world without enough work”. This issue is further aggravated by a decline in geographic mobility, which has fallen over the past 70 years. The ability to move has become the purview of those who have the financial means, in-demand skills, and willingness to incur the psychological and social “costs” of relocating to regions with greater economic opportunities.
As communities grapple with the challenges of an ever-evolving labor market, a handful of locales are focused on economic development strategies using a capabilities-based framework to grow jobs in their traded and local clusters. They emphasize evidence-based planning and investments, rather than relying on 20th century approaches, e.g. corporate subsidies. The “primacy of place” is central in their thinking. They are focused on actions to establish their communities as a compelling place to live and work by leveraging their unique strengths. They believe that a location’s quality of life attracts talent, and contributes to a stable and able population. In turn, this leads to employment growth and resiliency throughout the economic cycle. They position themselves as an antidote to the issues that are being faced by large, high-cost and congested metropolitan areas.
The capabilities-based planning process is well defined, but efforts to address the issue of the “future of work” are hampered by the failure to recognize the challenges posed by technological unemployment. Today, a handful of states have organized efforts to assess how technology advancement will shape their economies, and develop action plans to support workforce development and job growth in the digital age. They include California, Colorado, Indiana, Iowa, Montana, New Jersey, Utah, Virginia and Washington. The first step in solving a problem is acknowledging its existence. Instead, many continue to wish for the post-World War II boom years, and fail to recognize that we’re in a new era. I wish my hometown, New Britain, CT, would regain its position as the Toolbox of America, but it lost its standing in the late 20th century to more desirable locations in the U.S. and the global labor market. Rather than focus on the jobs of the past, emphasis needs to be given to the jobs of the future.
While there is a path to stem the impact of automation, globalization and urbanization, some view it as a “fool’s errand” akin to King Canute’s effort to reverse the tide. We have no alternative but to respond to the problems that are before us. In addition to business leaders, politicians, philanthropists, technologists, research organizations and educators, we all have a role to play at the national, regional and local level to defend and create American jobs.
As I continue to focus on the “future of work”, my concern has shifted from the general threat of technological unemployment to the impact of “a world without enough work”, which is already affecting communities across the U.S. A while ago, a friend let me know that he was constructing a WeWillNotWait.org website, but wasn’t certain of the final direction it would take. I know what he should emphasize. We will no longer accept gridlock and need practical bipartisan solutions to stem the further splintering of our society into the elites, workers that provide services to the elites, and those without hope. No more excuses; we will not wait!
September 11, 2019