The nature of work has changed in the United States since 1980. These changes constitute a paradigm shift regarding work. A paradigm is a shared set of assumptions about what leads to success. The history is that, once a paradigm shifts, a return to what was normal is no longer possible. In other words, the future is not going to look like the past.
This shift can occur for many reasons. Any community’s ability to plan and grow its economy over the long haul is directly related to a community’s understanding of this shift and the reasons for it.
Generally, the reasons can be categorized as technological progress and globalization.
Technological advances began to accelerate exponentially on April 30, 1993 when the Internet became commercially available to the general public. It accelerated again in 2008 when social media emerged. It continues to accelerate today with the development of advanced software and specialized applications, or “apps”. Technology puts information in the hands of people—individuals and organizations—quicker today than ever before. And they use that information to run their lives and identify and take advantage of opportunities for their companies.
Globalization came about because barriers were removed. The communications barrier was destroyed when ways were created to move information at the speed of light through pathways that wrapped around the world. Trade barriers were removed through the adoption of treaties and trade agreements. Quotas and tariffs were eliminated or substantially reduced. The world is, from an economic perspective, essentially borderless. Nothing exists to stop the flow of materials, products and knowledge around the world. It is now possible for companies to set up most anywhere in the world and move components and equipment to do most anything.
So, how has this impacted jobs in the United States? Significantly, it turns out. According to a recent New York Times article entitled The Changing Nature of Middle Class Jobs, nearly 300 out of every 1,000 middle class jobs were held by workers in the manufacturing industry in 1980. Today, the rate is half that. A community trying to recruit manufacturing jobs has the odds stacked steeply against it. The odds of success are low because of the declining numbers of manufacturing jobs and the increasing competition for those jobs.
This is an expensive strategy with high risk and low return. Too many are pursuing that strategy. Consider this: from 1980 to 2012, jobs for machine operators decreased by 33%; production supervisors by 23%; construction by 15%; freight handlers by 14%; assemblers of electrical equipment by 9%; metal working by 9%; and jobs for mechanics by 9%.
On the other hand, specialty occupations, especially those involving technology and innovation, accounted for the largest share of growth in the middle class wage range. While fewer positions are available in maledominated production occupations, a greater share of the jobs in demand today are in occupations more open to women. That same New York Times article indicates that in 1980, 19 of every 1,000 middle class jobs were held by registered nurses. Today, the rate is 39 per 1,000. Jobs for mathematical and computer scientists increased by 19%, supervisors by 16%, adjusters by 15%, and jobs for health technologists increased by 13%.
The same two forces that caused the demise of blue collar jobs are now fueling the rise of jobs in the innovation sector.
Enrico Moretti writes in The New Geography of Jobs, “The rise of the innovation sector is associated with an increase in the value of talent for a simple reason: economic value depends on talent as never before. In the 20th century, competition was about
accumulating physical capital. Today, it is about attracting the best human capital.”
“What really matters is that American workers produce goods or services that are innovative and unique and not easily reproduced. This is the only way to generate jobs that pay well in the face of stiff global competition.”
Talent is what occurs when education meets with innovation. The key to our economic future is to have educational opportunities available to those who want to be life long learners.
Written by Susan Parkhill, Sector Chair of Business Development, Greater Killeen Chamber of Commerce
Published in the Greater Killeen Business Quarterly 2015 Restaurant & Catering Guide