A recent article published in the WSJ, The End of Employees, provides a stark reminder of the vast changes occurring in our economy. The idea of outsourcing nonessential jobs is not new and, on the surface, is simply a well-worn CEO practice to reduce costs. Business’ attempts to increase efficiency and profitability are the hallmark of good management, so why is it creating so much angst?
Part of the answer lies in the pace and depth of changes in our increasingly complex marketplace.
At its roots, corporate outsourcing is the modern day embodiment of comparative advantage, an economic theory that states that individuals, corporations or nations, should exploit their inherent advantages when producing goods or providing a service in a global economy. It’s the basis of international trade and, in fact, many of the jobs that were outsourced initially, went overseas. Company call centers were among the first services to be targeted and were often sent to low wage countries.
In theory, we are better off when everyone does what he or she is best at doing. But taken to its logical conclusion, a corporation should outsource everything that is not part of its core or critical to its mission. Accenture PLC predicts that within 10 years, some companies may not have a full-time employee outside of the C-suite! Many of those jobs will still exist, but the opportunities for climbing the corporate ladder will not.
Outsourcing is only part of what’s behind today’s worker anxiety. Increasingly, jobs are simply being lost to automation. Robotics revolutionized manufacturing years ago and today it’s doing the same to jobs across many sectors of our economy. San Francisco commuters can now grab a freshly brewed cappuccino at Café X without any human intervention, thanks to Robo Baristas; Amazon is testing technology that eliminates checkout counters at its new grocery stores, Amazon Go; at Panera Bread customers can order and pay through in-store kiosks; and financial companies use robo advisors to offer advice and counsel to their customers.
Alvin Toffler described worker anxiety in his 1970 seminal book, Future Shock, which explored the psyche of a society when it’s confronted with rapid technological advances. Even as a futurist, Toffler couldn’t have imagined developments in digital technology, artificial intelligence and augmented reality. Years later, Toffler would opine that the best antidote for anxiety and sense of helplessness, is a life of continuous learning.
Today’s professionals need skills that aren’t subject to automation or vulnerable to being outsourced. Increasingly, they are defined by creativity and the ability to think outside the box; they reside in people who can collaborate and communicate with colleagues across the globe; professionals with empathy, emotional intelligence and critical thinking skills. No graduate degree can deliver on all those scores but an MBA from Ramapo comes close.