Pay is dropping and anxiety rising in our new workplace.
WHEN I ENTERED the American workforce more than 40 years ago, it would have been familiar to a time traveler from four decades before.
People still worked on typewriters or assembly lines. The telephone, installed by Ma Bell with a wire into the wall, was a primary tool of communication. Paper invoices continued to be sorted into tickler files from which they would be entered, often by hand, into double-entry accounting ledgers. More women were working, but otherwise the visitor from 1935 would have felt at home.
One key difference was welcome. Even though the economy was coming out of a recession, jobs were abundant compared to the heart of the Great Depression. Pay had never been better, especially for the large middle class.
Today the workplace would completely disorient someone from 1975 who stepped into a time machine and arrived at, say, Microsoft, Amazon, Boeing or even the smallest business.
Computers, the Internet and smartphones rule. In many cases, they have taken over work once done by secretaries, clerks and bookkeepers. The most basic jobs require skills in Word, Excel and PowerPoint, among other software. The cloud, the “Internet of Things” and 3-D printing would all be utterly foreign. So would Human Resources, once the humble personnel department, but with vast new powers to enforce rules, conformity and indoctrination.
Editor’s note: The way we work is changing. New workers are streaming into Seattle, a trend that isn’t expected to slow down. We work at jobs that were just created, and soon, some of us will work at jobs that haven’t yet been invented.
In 2016, Pacific NW magazine will explore our world of work, kicking off today with this cover story by Jonathan Talton.
We’ll profile a diverse mix of people doing interesting, unusual work, and those working tough, dirty jobs most of us wouldn’t touch. We’ll look at the trend of young people doing volunteer work. We’ll examine what it takes to make ends meet, including unusual paths, such as working under the table, as the gap between the 1 percenters and the rest of us continues to widen.
In Seattle’s workplaces, one thing you can count on is change. We’ll try to help you make sense of it.
The traveler from the 1930s or 1970s would be flummoxed by the new corporate-speak. Products and services are “solutions.” Trouble is “a burning platform.” “Drilling down” has nothing to do with oil but means to examine a situation more closely. A big difference is called a “paradigm shift.”
Much of the language seems geared to conceal, even deceive. A “fulfillment center” is anything but for stressed workers. “Rightsizing” doesn’t feel right to the laid-off employees. A “win-win” usually won’t be.
A striking number of employees is involved in sales now. Everyone seems to be selling something.
Some chief executives wear T-shirts; “casual” dress is ubiquitous. Everyone is on a first-name basis. Jargon such as “teams” adds to a sense of egalitarianism, very different from the military-style hierarchy of old. Workspaces at some top companies resemble dorm rec rooms at expensive colleges.
But the time traveler would soon discover that the boss is still the boss, and the sense of ease, play and informality is an illusion. With algorithms setting standards and computers monitoring them, the pressure to perform is, if anything, more intense than when people dressed up every day.
A big reason behind the popularity of last year’s New York Times story about the brutal environment for Amazon’s Seattle employees is that many Americans experience the same thing in their jobs — or fear it is coming.
Unions are rare in the private sector. So are pensions and a secure retirement.
Another big change is the inversion of age and privilege. In those previous decades, young workers were expected to shut up and learn. Veteran employees were valued for their experience and wisdom. Now youth is a huge advantage, and older workers cling to their jobs knowing it might be impossible to get new ones. Age discrimination is a quiet crisis.
But many younger workers, although coveted and often coddled, aren’t especially happy. The perceptive ones realize they are deprived of the older mentors and institutional knowledge that guided previous generations. They are also saddled with historic levels of college debt. And outside of the best-paid professions, they have entered the workforce making less than I did at the same age, a disadvantage that will be difficult to ever make up.
More than 7 million manufacturing jobs, the backbone of the blue-collar middle class, have been lost since 1979, even as the working-age population has grown. In today’s factories, robots already do a fair portion of work that once was performed by humans. Every industry is a high-technology industry.
The passage of 40 years is significant in another way. The mid-1970s would prove to be the high point for American wages, where workers got a fair share of their productivity. Since then, pay has stagnated or even fallen for most workers.
A job has always meant more than a paycheck. For a young person, it was a path to independence and maturity. My first full-time job was as an emergency medical technician, which involved particularly grave and adult responsibilities. For everyone, a job means dignity, or it should.
Even when it was drudgery, a job was the pathway up to opportunity, self-sufficiency and the American dream. In the best times, it was fun. All this was true. Or it once was.
Today we stand at a tipping point. And the way we will work in the future — indeed, whether we will all have jobs — is a momentous question.
SOME CONTOURS of the future are visible in the recent past.
The reliable American Jobs Machine first sputtered in the aftermath of the brief 1990 recession. We first heard the term “jobless recovery.” The decade went on to see a record 21 million jobs created in a long expansion.
But growth faltered again after the 2001 recession. This time, even during the unsustainable housing boom of the 2000s, most jobs increased at a weak rate.
Employment growth has been nearly as lackluster after the Great Recession. Although nearly 13 million jobs had been added by late last year compared with the trough of the downturn, the nation still faced a gap of 3 million jobs. This represented the numbers needed to reach pre-recession employment levels plus ones to accommodate the growth of the labor force.
The reasons behind the shift are complex. China’s entry into the World Trade Organization shattered employment in a host of American industries, from textiles and apparel to machine tools. Companies sent millions of positions overseas to take advantage of cheaper labor. Wall Street rewards companies that do more with fewer people, something they learned to do even better during the recession.
Despite flashy startups in Silicon Valley that employ relatively few people, many backbone sectors of the U.S. economy have become much more consolidated. That means fewer jobs.
Forty years ago, almost every city of any size had its crown jewels of headquarters, locally owned shops, and broadcasters and newspapers. Now, after 35 years of mergers creating many highly concentrated industries, that is the rarity, and with it have gone big chunks of employment.
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At the same time, automation continued to take away jobs, particularly those in the middle. The result has been a large number of new positions in low-paid sectors, some growth for high-skilled work such as software engineers and people in finance, but a hollowing out of the middle.
Economists call this jobs polarization, and there’s no indication that it will stop.
Rewards from work and productivity are also radically different from the era when the middle class was at its zenith.
Compared with the 1970s, workers make sharply less than the brass. According to the Economic Policy Institute, chief executives earned nearly 30 times the average worker in 1978. By 2014, it was 303 to 1. Profits also go more heavily to shareholders. As a result, labor’s share of national income has plummeted to its lowest level since measurements began in 1947.
A secure, full-time job with benefits was seen as an American birthright 40 years ago. Now it is much more difficult to find, with more people consigned to temp work or acting as private contractors.
This is romanticized as “the gig economy,” even though many caught in the trap would prefer “real” jobs. Unpredictable hours and earnings are the ugly reality for most. Except for a narrow elite, most workers have become commodities.
Another casualty of these changes has been the traditional ladder up. Throughout much of the 20th century, a person might stay at the same company his or her entire working life, moving up from the mailroom or the plant floor to become an executive or foreman, gathering skills along the way. Now many rungs have been removed, and more people are left behind.
As a result of these tectonic shifts, half of wage earners make less than they did in 1999. While 50 percent of income growth during economic expansions in the last half of the 1970s went to the lowest 90 percent of earners, all the gains in this one have gone to the top 10 percent.
That bottom 90 percent is poorer than in 1987. Meanwhile, the share of income going to the top 1 percent continues to hit records. As of last year, 47 percent of households have no savings. The Social Security Administration reported that 51 percent of American workers made less than $30,000 a year.
No wonder that inequality has widened to its worst since the eve of the Great Depression, even the Gilded Age of the late 19th century.
WORK IN THE very near future likely will be radically changed by a new generation of advanced automation, robots and artificial intelligence.
Robot co-pilots on airliners, autonomous ships, automated assembly lines where a handful of humans oversees hundreds of machines — all this is possible with today’s technology. Major railroads are exploring mile-long trains operated by only one crew member, where 40 years ago there were five.
Railroads offer a comforting example of technological change. In the 1920s, they employed some 2 million Americans (total U.S. population: 106 million). Today, about 185,000 work on the railroad. But other jobs filled the gap. So it has been since the industrial revolution.
But the speed, scale and sophistication of the transformation before us make it possible that this time is indeed different. This is especially true if the economy is stuck in a long period of stagnation, with no revolutionary, job-creating event, such as development of electricity or rise of railroads or the auto industry.
For example, highly automated Google has a market valuation of more than $360 billion. Yet, as a Brookings Institution paper pointed out, its 55,000 employees are only one-tenth as large as AT&T’s workforce in the 1960s.
Pedro Domingos, computer science professor at the University of Washington and author of “The Master Algorithm: How the Quest for the Ultimate Learning Machine Will Remake Our World,” says, “It’s not going to be a smooth ride by any stretch of the imagination.”
Yet he is not a pessimist.
“Over the next five to 20 years, some occupations will disappear, but lots of occupations will be created,” he says. With machine learning, humans and computers will be teamed up. “What in my job can be done by machine learning, and what can’t? What will be very hard to replace?”
For example, machines can’t do most construction. Loan officers, on the other hand, can be replaced. So can much legal and even medical work.
He says that even the most advanced automation lacks human common sense, physical dexterity and the ability to use context to integrate information.
“In the long run, we will get to the point, in our lifetime, where computers and robots can do everything better than people,” he says. “This will mark the transition to a very different economy.
“With such measures as a guaranteed universal income, this won’t be a problem. People might say, oh, the U.S. is falling backward because only 25 percent of people are working. No. This can be a great thing. People will find satisfaction in other things.”
Domingos downplays the fears of Stephen Hawking and Elon Musk over potential dangers of artificial intelligence. “Being intelligent and being human are two different things,” he says. “The real worry is about evil people who could get hold of technology. It’s not the machines but who controls the machines. The problem isn’t that the machines are too smart but too stupid.”
Asked what advice he would give someone in high school, Domingos, not surprisingly, says to study computer science. But he also sees a need for knowledge of the humanities. “They need the human side of things coupled with the ability to use machine learning. You can’t outrun the horse, so you ride the horse.”
He’s not the only observer to urge creation of a universal guaranteed income. Universal health care will be even more necessary as traditional jobs disappear. Many economists favor big investments in infrastructure to create jobs. And, with low interest rates, there has never been a better time to borrow for such investments as high-speed rail that would more than repay their cost.
But the United States is not only polarized in jobs but also politically. Americans are more divided than any time since the eve of the Civil War.
We have a difficult time talking with each other because we can’t even agree on which issues are most important, or whether they are even real (read climate change). While anxiety about jobs and opportunity is widespread, there’s bitter disagreement about causes and responses.
In such an environment, don’t expect a consensus on how to address a potential jobless future any time soon. A future that could liberate people. Or one that could spark a bloody revolution. A person’s job, multiplied by millions, is just that potent.
Americans are natural optimists. We’ve always owned the future, and we will again. Won’t we?