The Future of Work is Now

The future of work has become one of the most hotly debated and analyzed topics of the past couple of years. No one with a pretension of a serious nature or a desire to be seen opining on the “big” issues can afford not to have a point of view on it. Thus we are bombarded by an endless torrent of articles, books, academic papers, and speeches on the way in which the workplace will be changed by the emergence of  various technologies. The usual umbrella under which these technologies lurk is the one we call artificial intelligence.

There is no doubt that AI will have an enormous impact. There are countless breathless accounts of the number of jobs that will simply disappear as AI sweeps through the economy. These accounts usually appear from those involved in the invention and application of AI. They all end up expressing some form of fatalistic vision where the workplace will inevitably collapse under the impress of technology, wages will similarly collapse for those poor souls unable to keep up with the onslaught of robotics, with the resultant picture being grim for just about everyone except for the few who remain in the so-called “knowledge economy”.

The almost total agreement between all these accounts with respect to the dystopia they articulate is matched only by the paucity of mitigating prescriptions. Just about all of them agree that education is the only escape hatch available to the ordinary worker. Consequently there are as many equally breathless accounts about the need for everyone to engage in constant learning of one form or another as there are accounts of the impending wage disaster if we don’t all suddenly become perpetual students.

While I count myself amongst those concerned about the AI dominated future I consider myself a bit of a heretic.

Why?

Well, for one, no one has yet explained adequately how all this education will be paid for. How, for example, would a displaced worker afford the time or expense to make a transition, undergo a re-education, and yet still finance a continuation of her lifestyle? The unremittingly libertarian core creed of the technologists bringing us the future would appear to eliminate a collective response to this question. The state having been gutted of revenues here in the US is hardly capable of stepping in to play the role of financier of last resort to all this education.

Without an answer to this question all analyses ending with a call for ever more education are, in my opinion, sterile and worthless.

And any of them that do provide an answer that includes a role for private employers is simply missing the point: private industry has, for decades now, withdrawn itself from worker education.

Which is my main point today.

The future of work, if by that we mean the reconstruction of the workplace as a fractured, lean, and bleak landscape, is here already. It is here courtesy of the efforts over the past thirty years of private industry and its pursuit of shareholder value.

This salient fact is missing from the discussion by those obsessed by AI. They ignore the recent history that has seen a massive shift of risk onto the shoulders or ordinary workers. A shift that went unbalanced by an equal shift of reward such that prior standards of living were not undone.

The brilliance of the corporate adoption of the notion of shareholder value is that it provides what appears to be a profound and irrefutable logic to explain the grubby grab for a greater share of the national wealth by the shareholders of the economy.

Nowhere is it said that the objective of management is to maximize returns to shareholders. Nowhere, that is, except in the mainstream management literature. The notion of shareholder value is a modern conceit. It was constructed as a consequence of the unfortunate anti-social turn in economics during the 1970’s. It is a natural outcome of the determination of large corporations to push back against the post-war social contract that allowed space for increasing wages for workers. Those wages were viewed as an appropriation of profit that “ought” go to shareholders. After all those shareholders were being re-invenetd as noble entrepreneurs taking risks in order to provide the energy that resulted in growth from which workers would then benefit.

The problem during the 1980’s and later was that the economy’s innovative energy was apparently dissipating. Growth was slowing down. Gains in productivity were becoming patchy and harder to extract from arriving technologies. And yet the demands of investors were not recognizing this slowdown. On the contrary the demand was for ever increasing returns on capital.

One way of meeting the demand for higher returns in an environment that appeared to militate against them was to change the goals of the entire corporate reason for being.

By simplifying the purpose of a corporation and focusing it exclusively on shareholder value the way was opened for increasing portions of the national wealth to be allocated to profit, away from wages, and thus satisfy the rising demands of investors.

The consequence was a constant re-writing of the workplace arrangement, with every step designed to reduce worker compensation so as to free up cash for profit.

Nowhere has this process been more successful than in the deterioration of the value of benefits included in the overall compensation package workers now receive. The average worker is now more responsible for their own benefits than at any time in the post-war era.

But this shift of risk away from shareholders and onto workers was insufficient to maintain the momentum of returns to capital. More was needed.

Hence the adoption of more extensive measures such as outsourcing, offshoring, and the adoption of contingent work arrangements. All of these are logical consequences of the drive for ever more profit. And they have been standard practice for two or more decades.

The result is that our current workplace bears little resemblance to that of the immediate post-war years. It is dominated by contingent work, by a paucity of benefits, by stagnant wages, and by a the collapse of true opportunity. It is a bleak place. And it is here already.

Despite this there has been practically no institutional response. The policy conversation still takes place as if the older, richer, and more reliable workplace still dominates. Private industry having stripped away at the share of wages in our economy bemoans the inevitable slow growth. It takes no responsibility for having shaped the macroeconomic landscape. Our politicians are obsessed over the future and the onrush of AI and related technologies, yet they ignore the threadbare landscape in front of them.

Yes technology will shape the workplace. Yes it will produce a future of work. Yes we need to be concerned about that.

But what about the workplace shaped by the ideologically driven technology of shareholder value?

That technology has already produced its own future of work.

And that future is now.

We need to deal with it.