[FoRK] why Dilbert is doomed

Eugen Leitl eugen at leitl.org
Fri Nov 6 06:57:45 PST 2009


http://www.salon.com/news/opinion/feature/2009/11/02/healthcare_employment/print.html

Why Dilbert is doomed

The jobs of tomorrow are not what you'd expect

By Michael Lind

Nov. 03, 2009 |

Where are tomorrow's jobs going to come from? The question is more urgent
than ever, with official unemployment hovering around 10 percent and with
nearly one in five Americans unemployed, if you count part-time workers who
want full-time jobs and people so desperate that they have given up looking
for work entirely.

Most popular discussion about jobs focuses on the effects of offshoring of
manufacturing jobs to China and other countries, many of which, like China,
manipulate exchange rates and use subsidies to promote their industries.
Combating predatory trade practices and rebalancing global trade by means of
higher U.S. exports is important, in the short and medium term. But in the
long run technologically driven productivity growth is the most important
factor in shaping employment in the U.S. and every country in the world.

Productivity growth substitutes machinery or more efficient techniques for
physical labor (engines) and mental labor (computers). Even if the U.S. had a
completely closed economy, over time inventors and investors would figure out
ways to replace people with machines.

Since the beginning of the industrial revolution more than two centuries ago,
sectors that have adopted labor-saving machinery have shed labor to other
sectors. The mechanization of agriculture and mining -- "primary production"
-- freed up labor for factories. Increasing productivity in the "secondary
production" like manufacturing, by allowing one person with advanced
technology to do the work of dozens, freed up workers who were then employed
in "tertiary production" -- office work and business services that support
primary and secondary production. Thus the evolutionary progression, from
yeoman farmer to factory worker ... to Dilbert in his cubicle.

With the ruthlessness of Skynet in "The Terminator," computerization in the
tertiary sector is now committing mass Dilberticide, replacing receptionists
with automated phone systems and travel agents with services like Priceline.
The emptying of the cubicles won't result in permanent mass unemployment, the
present prolonged crisis notwithstanding. As it has always done in the past,
labor will shift from more mechanized to less mechanized sectors. But what
will those jobs be?

We already know the answer.

The most numerous and stable jobs of tomorrow will be those that cannot be
offshored, because they must be performed on U.S. soil, and also cannot be
automated, either because they require a high degree of creativity or because
they rely on the human touch in face-to-face interactions. The latter are
sometimes called "proximity services" and they include the fastest-growing
occupations, healthcare and education.

Most job growth in the last decade has been concentrated in three sectors:
healthcare, education and government, mostly state and local government.
Since the recession began, healthcare has added 559,000 jobs. Even more
remarkable, the average monthly gain of 22,000 jobs during 2009 has been only
slightly lower than the average increase of 30,000 jobs a month in 2008.

Last July, in a study titled "Preparing the Workers of Today for the Jobs of
Tomorrow," the Council of Economic Advisers predicted that between 2008 and
2016 employment will decline in manufacturing, retail and wholesale, business
and financial services and other sectors. Public-sector employment will
remain steady, and there will be growth in transportation and utilities and
construction. The greatest job growth, according to the White House, will be
in the health and education sectors. Healthcare-related jobs make up seven
out of the 20 fastest-growing occupations, and 14 out of the 20
fastest-growing jobs. The fastest-growing occupations are home health aides
and registered nurses.

The aging of the boomers accounts for only 10 percent of the growth. The rest
comes from increasing demand. That's because productivity growth in
agriculture, construction and manufacturing has greatly reduced the cost of
food, shelter and appliances. In the U.S. and similar nations, the freed-up
income tends to be used on quality-of-life goods, of which healthcare is the
most important. So-called ambulatory healthcare services, defined as
healthcare provision for people who do not need to be hospitalized, form the
fastest-growing part of the healthcare field. This underlines the point: As
other expenditures are reduced, Americans are spending more income on
non-emergency healthcare, a superior good that makes it possible to enjoy the
other goods of life all the more.

It's true that the U.S. needs to reduce unnecessary health cost inflation.
Paradoxically, however, a more efficient healthcare sector is likely to hire
more, not fewer, people, if tasks that are now carried out by highly paid
doctors are allowed to be performed by nurses and home health aides. Two
Stanford economists, Robert E. Hall and Charles I. Jones, have predicted that
even if healthcare is delivered in the most efficient possible way, Americans
are likely to seek to devote "30 percent or more of GDP on health by the
middle of the century."

The healthcare sector as a whole should not be considered a drag on the real
or productive economy. On the contrary, while employment in manufacturing is
declining overall, employment in pharmaceutical and medicine manufacturing in
the U.S. is expected to expand. In the words of the economist Robert Fogel,
"Just as electricity and manufacturing were the industries that stimulated
the growth of the rest of the economy at the beginning of the 20th century,
healthcare is the growth industry of the 21st century. It is a leading
sector, which means that expenditures on healthcare will pull forward a wide
array of other industries, including manufacturing, education, financial
services, communications and construction."

Another widespread myth holds that most Americans need to go to college in
the future. In reality, most of the fastest-growing jobs, including those in
healthcare, do not require a four-year bachelor's degree. According to the
Council of Economic Advisers: "The categories with some education required
beyond high school are growing faster than those not requiring post-secondary
schooling. The growth is not solely among occupations requiring bachelor's
degrees; occupations that require only an associate's degree or a
post-secondary vocational award are actually projected to grow slightly
faster than occupations requiring a bachelor's degree or more." The
appropriate public policy response is not necessarily to send more Americans
to expensive four-year colleges, particularly if that means crippling burdens
of personal debt in the form of student loans. We need to expand the
vocational training provided by the community college system.

None of this means that we don't need world-class scientists and engineers,
or that we don't need to rebuild our manufacturing export industries, or that
we don't need to hire people to design and build up-to-date infrastructure
and energy systems. High-tech agriculture, manufacturing and infrastructure
and related business and professional services will remain essential to
economic dynamism. But thanks to ever smarter machines, fewer and fewer
people will work in the primary (field), secondary (factory) and tertiary
(office) sectors. Most of the job growth will be in the "quaternary" sector
of healthcare and other qualify-of-life services.

Dilbert's days are numbered. Look for Dilbert Jr. at the nursing station. 


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