Thursday, 24 January 2013

Sticking It To The Middleman!

We all love to cut out the middleman. If it means we can save money, time and get what we want and not what someone else thinks we want then its all good. But is it?

When I go to the supermarket these days if the self service aisle is open I’ll use that rather than wait in the queue for someone else to serve me. That option though has consequences,  when I choose that option I’m helping a company decide to employ one person with the responsibility for 8 check outs instead of 4 separate employees for 4 separate check outs. Right now the supermarket will say they are giving me a choice. In a few years to come, there will be no choice. It will be self service for most of us and someone to help the older shopper that can’t do it by themselves. Less jobs, more profits.

Politicians like to tell us jobs have been lost to China and India, and they have. But the sort of jobs that are now going to China and India have been going to the cheapest markets for decades. A lot of the jobs that are being lost in the economy now aren’t manufacturing jobs. I don’t mind my computer being made in China, the whole world needs jobs. Besides China is probably what is keeping this world economy moving when the West has right royally screwed its own economy.

Its not the emergence of China and India that we need to be wary of. Nor is it the deficits of the US or European countries. Its the collapse of our economy through corporate and individual greed. We are responsible for it too. Every time we cut out the middleman we make a job less necessary.

The jobs that are disappearing in our economy aren’t the manufacturing jobs of old. For more than 30 years those jobs have been going to wherever that is deemed to be cheapest at the time. They disappeared out of the economy a long time ago, the manufacturing jobs that are staying here, are either industries that are barely hanging on or have taken steps to make something better than what China and India are offering.

Instead the jobs that are disappearing in today's economy are service jobs that used to require a local person to service you. Those are jobs that can’t be done by someone in China or India. Yet those jobs are disappearing faster than any other in today’s economy. Unless something is done about it, we are all going to suffer. If the politicians don’t catch on, until its too late, the economy of America and the economy of Europe is going to collapse. Those of us lucky enough to have jobs will be left with the bill of paying off the deficits that our politicians have run up and left holding up whatever economy is left.

When was the last time you used a travel agent to book your 2 week break? We are being bombarded with adverts on tv and online with ways to book our flight, hotel room and whatever else we want. Cheap flights are just a click away. All the people that used to do those jobs are having their jobs being obliterated not by developing  countries but by technology. That nerdy kid who used to get bullied at your school is getting his revenge, he now works for a software company that is eliminating jobs left and right. Whole employment categories, from secretaries to travel agents, are starting to disappear. 

You might think that the supermarket pays poor wages to the check out person and that job isn’t a huge loss, the person who lost their job doesn’t think so. Forget the supermarket analogy for a moment, a lot of the service jobs out there that are going the same way have middle class pay grades.

For more than 30 years technology has reduced the number of jobs in manufacturing. We have grown used to it. Now though technology is being adopted by every kind of organization that employs people. It's replacing workers in large corporations and small businesses, established companies and start-ups. The most vulnerable workers are doing repetitive tasks that programmers can write software for — an accountant checking a list of numbers, an office manager filing forms, human resource personnel reviewing job applicants for key words to help fill a job. The software of the technology today is becoming ever more  sophisticated, workers who thought they were protected by a college degree aren’t as safe as they thought.

Thanks to technology, companies are once again reporting profits but the jobs of those companies are only slowly coming back, and at lower pay grades than before the recession.

Entrepreneurs who used to be the great driver of new jobs in the economy can launch businesses with fewer employees than ever before. There is less need for administrative support and back-office jobs that handle accounting, payroll and benefits. It's becoming a self-serve world. Instead of relying on someone else in the workplace or our personal lives, we use technology to do tasks ourselves.

Politicians are distracted by the apparent threat from China or the immigrant. Those politicians miss the point. The immigrant is an easy target but immigrants pay taxes, they pay rent, they buy cars. They contribute to the success of the country. Take 11 million people out of the economy what happens to the economy? Big bad China provides goods at a cost that we are willing to pay and in return keeps the world economy ticking along. No politician is attempting to stop companies here from using technology that allows them to operate more efficiently with fewer employees.

Bad times are coming and we will reap what we sow. Technology is taking our jobs and we are helping corporations by cutting out the middleman. Just bought a toaster online? You helped make someone obsolete. It used to be that you would go to a store and someone with knowledge of of what you were buying would help you choose something that would work for your needs. Now if there is someone at that section of the store at all they will usually be young, on minimum wage and with minimum knowledge of the product. Thats sad, because its that knowledge that could be the difference maker in whether they have a job in a few years.

Politicians either don’t realise it yet or they think its not going to get the votes in the same way as blaming the immigrant or the developing world for the disappearing jobs. If you are so good at your job are you really going to lose your job to someone that doesn’t speak English? Yes you might, thanks to someone in Silicon Valley you might lose it to a machine, or software.

If I buy a dress for my wife without going to a store? I’ve just taken work from a saleswoman.

Back in Glasgow, where I am from, they are converting the 100 + year old subway system to run on driverless trains.

Technology is enabling companies to do tasks that people used to do. Companies are realizing they don't have to re-hire people if a machine can do it for them, at least not as many. Maybe trains will be better without human error but our economy is going to be better the more jobs it has in it. Those of us lucky enough to have jobs will pay less taxes if more people are in work. Technology is always going to eliminate jobs regardless. However we have a choice in what jobs are eliminated, if we like human interaction in the things that we do we can choose that until that choice is taken away from us.

1 comment:

Siobhan said...

I think this is really interesting. I'm not sure I totally agree with all points but as we now have a service industry based economy it is a good point. There is also a wider point about the social implications of cutting out more and more social contact. For my part I'm hoping to shop more localy (even in supermarkets) and less online where it makes sense to. I think that also makes the experience more real, but as the high street starts to close (blockbuster and hmv both in administration) that gets harder and harder. Food for thought though.