Tech changes not all doom and gloom
DALLAS — Business leaders and experts from around the country gathered at the Federal Reserve Bank of Dallas last week to talk about nothing less weighty than the rapid, relentless and widespread disruption of the economy enabled by fast-moving technological advances.
If that sounds far out, conference speakers were there to assure anyone with a job or who may ever need a job that it’s not. Here are five major points they made:
Education: Schools must change the way they teach — and some are already doing so.
El Paso Community College created a transportation center that can help retrain truck drivers whose jobs are expected to be displaced by autonomous trucks by teaching them related skills like diesel tech or logistics, according to William Serrata, the school’s president.
Paul Quinn College in Dallas describes itself as an “urban work college,” its President Michael Sorrell said. It requires students to work a few days a week and attend classes other days. The jobs give students — the majority of whom are on Pell grants — the chance to graduate with a work transcript and connections that create a pipeline to employment. In the fall, it plans to launch a program for alumni that allows them to return to college and learn new skills, if their jobs are displaced by technology.
Other experts highlighted the need for better early childhood education — something the Dallas Fed has supported.
Training: Most training — and retraining — programs aren’t keeping pace with technology.
“While training efforts are being beefed up at very rapid levels, they probably aren’t being beefed up fast enough to keep up with disruption,” said Dallas Fed President Rob Kaplan. He said the programs must also grapple with the cultural and emotional obstacles of midcareer and middle-aged workers who may be hesitant to return to the classroom.
Jan Rivkin, a professor at Harvard Business School, said he’d like to see the private sector offer solutions. He said he’s worried by how quickly technology is causing companies to shed jobs and how slowly workers are getting retrained. He said he spoke to a well-known venture capitalist who wanted to invest in companies that are retraining people — but couldn’t find any.
He did not name the venture capitalist, who said that he realized he had invested in companies that caused job losses and “as a citizen, I’d like to be able to sleep at night.” Rivkin said part of the problem is that the private sector is displacing people and the public sector is retraining them.
Changing workforce: The workforce of the future will look different — smaller, in some cases, and demanding different skills.
AT&T has about 250,000 full-time employees in the U.S. — with about 20 percent of those at call centers — but that number will fall in the years ahead, Chief Financial Officer John Stephens said. Some jobs will disappear and others will require new skills, such as data science and software proficiency instead of ability to lay cables. That’s why the company has a retraining program that encourages employees to take college classes and get “nanodegrees.”
“When you go from cable connecting telephone poles to spectrum in the sky, you have different jobs,” Stephens said. At the bottling plant of Coca-Cola Beverages Florida that employs about 5,000 people, CEO Troy Taylor said the company is investing more than $1 million to re-engineer its 15 manufacturing lines to make them more efficient. The result, he said, will be a smaller workforce that helps analyze data, such as tracking beverage types that sell well in certain grocery stores and geographic regions, and using that to structure production and distribution.
Demographics: Disruption by technology may be accelerating, in part, because of changing demographics. Companies are turning to technology because they feel squeezed.
With a low birth rate and aging Baby Boomers, companies see technology as a way to drive down costs and drive up profit. For example, Taylor said, with more efficient bottling lines, the company can save money.
Former J.C. Penney CEO Mike Ullman said department stores and other retailers must get creative to attract customers to their stores and compete with online retailers like Amazon, since Baby Boomers are at the point in life when they don’t need many new clothes.
Mark Duggan, director of the Stanford Institute for Economic Policy Research, said that the use of technology to make health care, in particular, less laborintensive could help control costs.
The upside: It’s not all doom and gloom, though. All this automation makes being human more important than ever.
Patrick Harker, president of the Philadelphia Fed, said that technology is changing faster than ever. The only constant “comparative human advantage” is that humans can be creative. And that’s something we need to foster in workers, he said, so teaching the humanities and creativity should be top priorities — even if more and more jobs are in technical fields.
Sam Schulhofer-Wohl, a senior economist with the Chicago Fed, also argued that as economists and policymakers talk about the high-level labor market implications of automation and technology, they don’t lose sight of a fundamental truth about people and their work: “There’s much more to a job than how many hours you work and what you get for it,” he said.
For many, he said, jobs are sources of meaning and happiness.