Cre­ativ­ity, Clus­ters and Why Your Barista Has Mixed Feel­ings About You

And Why Your Barista Has Mixed Feel­ings About You

Rotman Management Magazine - - NEWS - By Roger Mar­tin, Richard Florida and Melissa Pogue

Nearly half of the work­force is stuck in low and de­clin­ing-wage em­ploy­ment, vir­tu­ally guar­an­tee­ing the con­tin­ued stag­na­tion of the mid­dle class.

ce­mented in the Amer­i­can zeit­geist, four milIN A MORN­ING RIT­UAL lion Amer­i­cans get their cup of cof­fee at Star­bucks. But among those who re­ceive their morn­ing pick-me-up every day, do any stop to ask the ques­tion, ‘Who serves the barista?’

Cer­tainly, the barista seems to be pay­ing at­ten­tion. And for what seems like the first time in a long while, an in­flu­en­tial po­lit­i­cal can­di­date has paid at­ten­tion, too. Mir­ror­ing the grow­ing num­ber of news sto­ries high­light­ing Amer­ica’s grow­ing in­equal­ity, Bernie San­ders’ pop­u­lar­ity re­mained stead­fastly through­out the en­tire Demo­cratic Party pri­mary sea­son in the face of the ‘es­tab­lish­ment can­di­dacy’ of Hil­lary Clin­ton. De­spite low un­em­ploy­ment, low in­ter­est rates, and high per capita pro­duc­tiv­ity, ev­ery­day peo­ple in cities all over the U.S. dra­mat­i­cally protested an un­just sys­tem.

To un­der­stand the cur­rent mal­con­tent among baris­tas — and much of the U.S. elec­torate — we must first de­scribe two el­e­ments of work: in­dus­tries and oc­cu­pa­tions. In do­ing so, we will ex­plore the in­ter­sec­tion of th­ese two el­e­ments and the pat­terns that de­velop. What quickly emerges is a model of dis­crete win­ners and losers in the mod­ern econ­omy.

To pros­per in the global econ­omy, every re­gion and in­dus­try must boost the cre­ative con­tent of all types of work.

In­dus­tries vs. Oc­cu­pa­tions

To be­gin, it is im­por­tant to un­der­stand the dif­fer­ence be­tween in­dus­tries and oc­cu­pa­tions. An oc­cu­pa­tion can be ac­com­plished in many in­dus­tries, and an in­dus­try is com­posed of many oc­cu­pa­tions. Ac­coun­tancy is an oc­cu­pa­tion, but each in­dus­try, whether hos­pi­tal­ity or man­u­fac­tur­ing, needs ac­coun­tants.

In­dus­tries dif­fer in more ways than just the oc­cu­pa­tions that com­prise them. Har­vard Busi­ness School Pro­fes­sor Michael Porter played a piv­otal role in the study of in­dus­tries — which led to the un­der­stand­ing that the co-lo­ca­tion of firms can have broader im­pli­ca­tions for the pros­per­ity of re­gions. In his work on com­pet­i­tive­ness, he clas­si­fied in­dus­tries into two types: lo­cal in­dus­tries and traded clus­ters.

The in­dus­tries that form traded clus­ters pro­duce goods and ser­vices that flow across bor­ders. The bor­ders don’t need to be na­tional bor­ders where the out­put is counted as in­ter­na­tional trade; they could be as mod­est as a neigh­bour­ing town or re­gion. The im­por­tant part about traded clus­ters is that they are formed by con­nected in­dus­tries in close ge­o­graph­i­cal prox­im­ity. This web of firms, sup­pli­ers, aca­demic in­sti­tu­tions and lo­cal

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