17 Conference Report #techonomy17

The Uncertain, Unstable, Changing Nature of Work

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  • From left: Byron Auguste of Opportunity@Work, JPMorgan Chase Institute's Diana Farrell, Sasan Goodarzi of Intuit, Care.com's Sheila Marcelo, and Paul Roehrig of Cognizant in conversation with moderator, Peter Petre. Photo Credit: Paul Sakuma Photography

Speaker

Byron Auguste
President and Co-Founder, Opportunity@Work

Diana Farrell
President and CEO, JPMorgan Chase Institute

Sasan Goodarzi
Executive Vice President and General Manager Small Business Group, Intuit

Sheila Marcelo
Founder, Chairwoman, and CEO, Care.com

Paul Roehrig
Head of Strategy, Cognizant Digital Business, Cognizant

Moderator

Peter Petre
Author


Session Description: Relentless automation and the shift to platforms is changing how we organize and categorize work. As the economy evolves from “jobs” to “tasks,” policies, safety nets, and systems struggle to keep up. How do we ensure everyone benefits from the new landscape of work?

Below is an excerpt of the conversation with the full transcript available here.

Petre: We’re going to try to get you leaning forward rather than back and snoozing. And I’m going to ask my panelists to just come out and then I’m going to do a little bit of a setup.

The nature and future of work has been an ongoing topic of discussion at Techonomy over the years. So I want to throw out 10 quick facts to focus us on the moment and the issues that we face right now about it.

Number one is 10 years ago was the start of the Great Recession. In fact, it has its birthday next month in case anyone wants to plan a party. But since that time the economy has sort of clawed its way back toward prosperity and in the process, 16 million new jobs have been created in a workforce of about 160 million people. That’s number one.

Number two is we’ve gone from peak unemployment of about 10 percent in this cycle to what the economists euphemistically call full employment, which means only 4 percent of people are unemployed.

Number three, even more good news, is that after many years of stagnation, wages are up. Who knew? Median wages in full-time jobs have actually trended higher for the past couple of years. And yet, as we’re all aware, there are lots of crosscurrents and instabilities in the workplace and in the workforce, which is why we’ve titled this panel the way we’ve titled it, “The Uncertain, Unstable, Changing Nature of Work.”

Number four is that most, maybe all, of the net job growth is in so-called contingent jobs. It’s basically contract workers, independent freelancers, on-call workers, help agency workers. And by the way, did you know that more and more American families are moonlighting as well?

Next fact: The New York Times ran a piece a few weeks ago that 1.5 million workers have disappeared from the workforce. Presumably they dropped out of the workforce with the recession and just haven’t come back, but nobody has quite pinned it down yet.

Number six is despite the median wage increase, there’s something to what the Atlantic Monthly recently described as “slow, continual downward pressure on the value and availability of work in America.” That’s mainly as expressed in full-time jobs.

Next point: employers—including, I’m sure, companies represented here in this room—have been complaining and struggling to find workers that have the right skills for the jobs they need.

Number eight: there’s this ongoing and very mysterious sluggishness in new business formation and job creation. And I hope we come back to that; I think it’s a central topic. And I know people here in our group have a lot to say about it.

Number nine, there’s a phenomenon of what might be called ‘taskification’ going on. All up and down the work spectrum, from professionals to white-collar, to blue-collar, to pink-collar, to no-collar jobs, there’s fragmentation of jobs into tasks, and some of those tasks are eminently automatable and done better by machines.

And then finally, there is this issue of the morale of working people, also all up and down the spectrum. In a recent report into it, [one] quote: “A high baseline level of insecurity surrounding jobs, income, and benefits among American workers.”

So if that’s not a confusing picture, I don’t know what is, but that’s why we’re here today. Some of these effects are cyclical. Some of them point to permanent shifts in the nature of work; many of them driven by technology. But at this moment of boom and of full employment, it’s really hard to tell things apart, and that’s why we’re going to have this panel—to try to tease apart some of the strands, to surface some ideas, and see if we can shed some light.

Each of my panelists is very accomplished in his or her own right, plus each person on this stage has deep expertise in the question of work from a completely different facet from anybody else on the panel. So we have five completely different outlooks. And we’re going to see those compare and contrast as we go along.

So let me just quickly introduce people and then we’ll get going. So let me start with Paul Roehrig, who is the Chief Strategy Officer of Cognizant Digital Business. He was also founder of the Center for the Future of Work at Cognizant. And he’s a writer. His latest book is, What to do When Machines do Everything; we have copies and I hope people pick them up. It’s a terrific book full of interesting and provocative thoughts and observations. So Paul, welcome.

Roehrig: Thanks.

Petre: Sheila Lirio Marcelo is a founder. She’s a founder and CEO of Care.com, which is the largest platform on the internet for family care. It means elder care, it means child care, it means pet care, it means house care. It’s a platform for independent care workers to link up with jobs. So welcome, Sheila.

Sasan Goodarzi is the Executive Vice President at Intuit, and you know Intuit from TurboTax and QuickBooks. Intuit serves millions and millions of households and small businesses, and has deep insight into what those customers are up to, and they need to do that to keep their products current. So we’ll be tapping into some of that knowledge and insight from you. Welcome.

Diana Farrell, Diana had a long, distinguished career running the McKinsey Global Institute. She then did a stint at the Obama White House as a Deputy Director of the National Economic Council. And then came back to found her own institute at JPMorgan Chase, where she’s the founder and CEO.

And finally, Byron Auguste, who is our only walking, talking labor economist on stage, Oxford- trained. He had a long, distinguished career at McKinsey as well and wrote for the McKinsey Global Institute. He then also did a stint at the Obama White House as a Deputy Director of the National Economic Council, and now he runs a startup, which is called Opportunity@Work. And we’ll hear a little bit about that later.

But to get us going, and since we’re kind of in exploration mode this afternoon, I’m just going to ask one question and ask for a brief answer from each our five discussants. And then if there’s anybody on the floor that wants to throw in an answer to the same question, just raise your hand. We’re going to start the discussion immediately; we’re not going to wait until the end.

So here’s the question: Here we are at this moment of what the economists call full employment. Can you name a single thing that you find most puzzling about the nature of work in America and the job market today?

So I’m going to start with Paul.

Roehrig: The single most puzzling thing to me is there’s a zeitgeist of fear and concern. When you look back historically at every major shift in business and technology, there’s been an interregnum where people are afraid of the technology—either concerned or out and out afraid of new technology and what it’s going to mean. It could have been the Luddites, it could have been—you can go back thousands of years and find history. And I think we’re in that space right now. So the most puzzling thing for me, and we touched on in the book a little bit, is this sense of apprehension and concern. It feels very much like, you know, when you read the news, whether its political news or work news or economic or technology news, there’s a sense of things are not going really well. And so I’m puzzled and entranced by that context.

Petre: Got it. Why won’t people take some good news?

Roehrig: Well, you know, you don’t want to trivialize it and say, you know, everything’s great. But there is a sense of opportunity and possibility and I think that’s being turned down more than I think it should be.

Petre: Okay, great. Thank you. Sheila.

Marcelo: Hello, good afternoon. The most puzzling thing for me is actually how we undervalue care in this society, when it is the foundation and infrastructure that actually drives jobs and thus the economy. From a demand side, you know, it’s $320 billion dollars. It’s one of the fastest-growing job categories that supports all work. And if you’re wondering, in the audience, like, does it even pertain to me? So how many of you have kids? How many of you have been nieces and nephews? How many of you have been children?

[LAUGHTER]

So—and I often ask that question when I’m public speaking because people don’t think that the care relates to them. But the senior tsunami that’s coming of 10,000 born—I mean 10,000 that’s becoming 65 years or older, it’s upon us. And yet we don’t think about it. But yet on the supply side, we undervalue this infrastructure. I mean, we invest in roads in bridges, and yet what drove the economy in overall GDP growth was really female participation in the workplace in the last four years.

Petre: Okay, so we’ll put a marker on that. We’re going to come back to it.

Marcelo: So pretty puzzling for me.

Petre: Very good. Sasan.

Goodarzi: So just to humanize it, you’ve got folks today—they have a full-time job and they may do Uber, going and coming back to work. Or all they do all day long is do work, whether it’s Care.com, Upwork, DoorDash, their whole entire life is doing different gigs. And for me—and by the way, our entire United States system does not support these folks, in terms of how we do paychecks, insurance, benefits, everything. And the most puzzling thing to me, when you talk to these folks is on one end they absolutely love the freedom of being able to do what they want to do when they want to do it; on the other hand, they are extremely concerned about the lack of stability of pay. And that’s very puzzling to me because there’s a love-hate relationship that people have in this gig economy.

Petre: Interesting.

Farrell: So this is a hard question, because I think there are many topics and each one of the ones you’ve raised is good. But I think the one that I have not seen a good explanation, and I certainly have spent a lot of time trying to think hard about it—you alluded to it, Peter, in your 10 factors of the economy—but it is what has really been a 40-year structural decline in startups in America. And of course, this last recession, you know, made it terrible. But you just have to zoom out to say in 1978 the rate of new startups was about 15 percent of the base. That’s 800,000 jobs being created every year by people starting up new. Today, that number is 8 percent, fewer than 500 jobs. And you know you had a little bit of an up and tip, but it’s been a structural decline.

Petre: Yeah, we heard John Chambers talk pretty passionately about—

Marcelo: About this topic. And I thought he was very interesting, but I was not fully compelled by his explanations.

So I think really getting behind that at the same time that the exit rates have not changed, that creates a very clear problem for the structure of our economy.

Petre: Okay, great. Byron.

Auguste: Thanks. Well I think it’s not surprising that people feel afraid, because I think half of Americans certainly have been living through a very long and deep recession, I mean a multi-decade recession, effectively, in their household incomes. But what I do find surprising is the sense of fatalism among elites, if you will, across the board about the future of work. I mean, work is solving problems. And last I checked, we were not running out of problems. I mean, work is building things, it’s fixing things, it’s inventing, it’s caring, it’s entertaining, it’s educating. There’s so much work to do; there’s so much high-value work to do. I mean there’s so much high net present value investment to be done in infrastructure, in so many different phases of industry and invention. And there’s extremely high social value caring work to be done—which, by the way, I think has something to do with the entrepreneurship problem, when you have the disappearing fabric of care that provides the risk management underneath that. So I think we need to really look beyond—too much of our debate treats technology as if it’s a force of nature, and technology will do X or technology will do Y, or it will take this job or that job. And too much of it treats our institutions as static. Well, news flash, we are in charge of our institutions, we can change them. So if our institutions, whether it’s our capital markets or our labor markets, our education, are not doing what’s required to help us unlock the kind of investment in sort of the high value work we need to do, then we need to change them. And so that’s where I think I would like to focus the conversation.

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