Are we ready for the future of work?

8 November 2017

In the early 1990s science fiction writer, William Gibson famously observed that “The future of work is here – it’s just not evenly distributed.”  Fast forward about three decades and it is very clear that the future of work is indeed here, in abundance, it is widespread, and it is morphing at an accelerating rate of change.  We are no longer at the bottom of the J of the exponential growth curve, we are racing upwards.  The question posed here is simply: are we ready?  Are our social systems and institutions adapting at an equivalent rate of change? 

This is not an original question.  It was the focus of a public lecture organised by the Monash Business School that I had the good fortune of attending last week.  There, Joel Cutcher-Gershenfeld, a Professor with Heller School for Social Policy and Management at Brandeis University, raised it.  However, I suggest that this question is not being asked nearly often enough.  Certainly not in the Australian context.

Three digital revolutions revolutionising work

 

When the Professor challenged his audience, he did so with reference to what he referred to as the third digital revolution – digital fabrication.  The question of readiness is relevant to all three revolutions.  The first was computation; the second, communication.

The future of computation here today is big data analytics, automation, robotics and artificial intelligence.  The scaremongers have run a “dead man walking” campaign: that many of the jobs today will not be around tomorrow.  True.  But there will also be new jobs in new endeavors that cannot be foreseen today.  Interestingly, one of the key authors of what for the last five years has been the bible on the susceptibility of jobs to computerisation, Michael Osborne of the renowned Frey and Osborne duo, is now one of the key authors of the more optimistic recently released report on employment in 2030, where fewer job deaths are predicted, and occupations likely to experience a growth in job births are identified.  It constructively has something to say on the skills needed for agility and success (more on this later).

The second digital revolution of communication today includes email, Skype, social media, the cloud, games and the internet of things.  This has revolutionised how, when and where we work.  Remote working, hot desking, offshoring, outsourcing, and the shared, peer-to-peer and gig economies have all been made possible by this revolution.

Soon to turn the bend of the J-curve is the third digital revolution.  For the digitally challenged, like me, digital fabrication is most commonly understood as 3D printing.  It is.  But it is also so much more.  It is the process that joins design with production through the use of 3D modelling software.  While least understood, this is the revolution that fascinates me the most given my roots as an economist.  It has the potential to disrupt all that we think we have learned since Adam Smith about specialisation, production, comparative advantage and trade.  It is possible to fully manufacture goods – any goods that we can conceive – in a single setting.  Once digital fabrication emerges from the bend of the J-curve, the implications for the nature of work and how work is organised are potentially huge.  But poorly understood.

Generations and the gig economy

The next generation of workers is growing up in this environment.  They are digitally literate and constantly connected.  As a consequence, the literature will tell you that these workers have different abilities and preferences than their older peers (see for example research by McCrindle).  We are told that they expect workplaces to be flexible, allowing them to work when and where they feel most productive and/or can fit around their life demands.  They think nothing of moving between jobs, careers, industries and countries.  And they are entrepreneurial – hiring out their services on a project-by-project or “gig” basis, running a side hustle, and/or a micro business.

Having just taken the scary step of walking away from a perfectly good and secure job into the brave new world of freelancing, I can confirm two things.  The first is that all of the above is true.  The second is that it is not just the purview of the next generation.  As someone harking from Generation X, I am somewhat comforted to discover the mix of generations who are pursuing their own ventures.  Motivations may include independence, having the flexibility to pick up the kids from school, specialising and capitalising on niche skills, through to keeping a hand in while winding down in ones’ latter years.  More negatively, for some freelancing has become the option of necessity as they have struggled to secure roles in the more traditional labour market.

There is no official definition, estimate or prediction of freelancers in the Australian gig economy.  However, we have only to think about how many of our family, friends and other acquittances who are either moonlighting, contracting, temping or running their own micro businesses, and it is not too much of a stretch to conclude that the number of freelancers is big, and getting bigger by the day.  The growth of digital freelancing marketplaces, such as Airtasker or, for the elite, Expert360, corroborates this conclusion.   As do estimates and projections outside of Australia.  Research by the McKinsey Global Institute finds that 20 to 30 percent of the working age population in the United States and the European Union is engaged in freelance work.   In the United States Intuit estimates that by 2020 – that is, in less than three years time – freelance workers will exceed 40 percent of its workforce.

Are we ready?

So back to my original question: given the pace of change impacting work, are we ready?  Are we evolving our social systems and institutions at a rate that keeps pace?  Here I deal with just two: education providers and businesses.  Are education providers teaching students the skills and competencies necessary to thrive in their future roles?  Are businesses shaping their cultures and adopting policies and practices to take best advantage of digital and other developments, and changing worker preferences?  A third, which there are not enough pages in this piece to cover, but I will leave you to ponder: does the broader regulatory environment support or impede change?

Let's start with educational providers.  The recently released report by Osborne and others mentioned earlier on employment in 2030 shines a light on the skills that will grow in demand.  These are broadly grouped as interpersonal skills, higher order cognitive skills, and systems skills.  These broad groupings align with future skills identified in Australia by the Foundation of Young Australians and the Productivity Commission.  The Productivity Commission dedicated a whole chapter to future skills and work in its recently released Productivity Review, and went so far as to assert that if it had to pick just one thing to improve, it is the formation of these skills.  This is not to say that good things are not happening.  Having immersed myself in education policy and the sector for over a decade I could point to lots of terrific examples where education providers are doing great and innovative things to nurture and evidence skills for the future in their students.  The challenge is to share these experiences and make them more widespread.  The Productivity Review makes a compelling case for change and provides recommendations to support the development of future skills throughout life – from schools through to the reskilling of existing workers.

While change needs to start in our schools, if not earlier, it needs to continue in our workplaces.  Having worked for a professional accounting body – at the intersection of education providers and businesses – too often have I heard employers placing the weight of burden of change on educators.  To take best advantage of the future of work they need to start with themselves.  Are they investing in the digital and “soft” skills of their workers?  Even if those workers move on, the reward will be in attracting others who value learning.  Do their workplaces, practices and, most importantly, cultures support an agile and blended permanent and freelance workforce?  With instant access to knowledge and the opinions of others via the devices in the palms of their hands, today’s and tomorrow’s workers are sophisticated consumers of opportunities.

A final question that I will end on is whether businesses are exercising their foresight more broadly to capitalise on the new world of work?  NAB provides a positive example of future thinking.  But how many others are doing the same?  As someone new to freelancing I was not keen to work from home as the temptation to avoid work would be great.  From home it would be too easy to succumb to the sudden and unprecedented imperative to mop my floors or do the washing.  NAB makes available to people like me a collaborative working space – The Village.  People in The Village can come and sit alone or in groups, plug in their laptops, access wifi, utilise the meeting rooms, and take advantage of the opportunity to network with and have your eyes opened by the most diverse and entrepreneurial people you could ever wish to come across.  There is no direct charge.  There is, however, a requirement that you do your business banking with NAB.  If Australia’s future freelance workforce grows to proportions predicted in the United States, that is clever future thinking.

The future belongs to those who prepare for it today.”  (Malcolm X)

Mary Clarke

Principal

DXP Consulting

M: +61 401 088 571

E:  mary.clarke@dxpconsulting.com.au