A Strong Job Market and the “Gig” Economy

The two don’t go together very well.

It wasn’t so long ago that the so-called “gig” economy was all the rage. In the early 2010s, with a sizable portion of companies being skittish to commit to hiring full-time workers due to fresh memories of the economic downturn, many workers found opportunities to make money through various different gig economy service firms — companies like Uber, Lift, Postmates and others.

What those jobs offered workers were flexible schedules, reasonably decent pay, and the ability to cobble together a livelihood based on holding several such positions (while still being able to hunt around for full-time employment).

For employers, it was the ability to build a workforce for which they didn’t have to cover things like office expenses and various employee benefits — not to mentioning paying for payroll taxes like the employer social security contribution.

In the past few years, the environment has changed dramatically. With national unemployment hovering around 3.5% — and lower still in many larger urban areas — “gig” companies have found it more difficult to find workers.

What’s more, those workers who are hired are churning through the companies more even more quickly than before — many staying with these jobs for just a few months.

Tis is driving up worker recruitment costs to their highest levels ever.

In a May 2019 interview with The Wall Street Journal, Micah Rowland, COO of Fountain, a company that helps gig companies acquire new workers by streamlining the hiring process, puts it this way:

“It [strikes] me that in some of these markets, they’re processing thousands of job applicants every month — and these are not large cities.”

In Rowland’s view, gig companies in some markets may be burning through the entire available labor market of people willing to work in roles of this kind.

It isn’t as though turnover rates aren’t high in other service sectors in the more “traditional” economy. In the fast-food industry, for example, turnover is running as much as 150% annually these days. But in the case of gig employment markets, it’s even higher — sometimes dramatically so.

With the tight labor market showing little sign of loosening anytime soon, it may be that we see some firms looking at “regularizing” employment for at least some of their workers. If it makes economic sense to hire some actual employees in order to curb recruitment costs, some will likely go that route .

There’s another factor at work as well. More of these gig economy workers are becoming more vocal about pushing back on pay and working conditions. Noteworthy examples have been recent protests by rideshare company workers in cities like Los Angeles and San Francisco.  Others have done the envelope math and have determined that once driver-owned vehicle costs of gasoline and depreciation are calculated against declining fares that have dropped below $1 per mile in some markets like Los Angeles and Minneapolis-St. Paul, workers’ effective wages are significantly less than even $10 per hour.

Picking up on these worker concerns, a number of activist groups are making gig economy companies like Lyft and Uber into a “cause célèbre” (not in a good way), but loud, polarizing detractors such as these tend to muddy the water rather than bring fresh new insights to the debate.

As well, one wonders if the activism is even needed; I suspect what we’re seeing now is a pendulum swing which happens so often in economics — where an equilibrium is re-established as things come back into balance after going a bit too far in one direction. In the case of the gig economy, the low unemployment rate in many regions of the country appears to be helping that along.

Predicting the top tech jobs, 20 years out …

What with the inexorable march of technology – which sometimes seems more like a relay race – it’s interesting to speculate on which occupations will be most in demand five years or ten years from now.

That seems pretty reasonable. But what about 20 years on?

Is it even possible to predict which jobs will be most in demand by then – particularly in the tech sphere? Or is that a fool’s errand, destined to elicit howls of laughter should anyone deign to look back at 2020 predictions when 2040 rolls around?

As it happens, the prognosticators at British multinational defense, security and aerospace company BAE Systems are willing to stick their necks out on the topic. They asked their own futurists to tell the what the top jobs in tech might be in 2040.

In broad terms, the answer is that future jobs will be in professions that bridge technology.  More significantly, it will be the technology that is the primary job generator, not the profession itself.

But it you really want to bottom-line it, anyone who focuses on artificial intelligence, virtual reality or robotics should be able to future-proof his or her career.  At least, that’s the unmistakable takeaway from the jobs that have been earmarked as the “hottest” ones looking ahead 20 years.

And … here they are:

AI Translator – People in these jobs will train other humans as well as their artificial intelligence assistants or robot counterparts, tailoring AI to meet workers’ needs and tune it to acknowledge and correct human errors.  Smart-aleck machinery – it’s just what the world’s been waiting for …

Recommended educational background: IT studies, cybersecurity, mechanical engineering

Automation Advisor – As companies become more reliant on automation and robotics, people in these jobs will make sure that the automated workforce is in line with regulations.  Compliance officers for machines – why not?

Recommended educational background: Physics, mechanical engineering, robots

VR Architect – As AI models are used to predict maintenance, people in these jobs will use virtual and augmented reality to monitor components and manage maintenance activities.  That’s OK – plant maintenance has always been a responsibility with a lot of downsides …

Recommended educational background: IT studies, graphic design

Human e-Sources Manager – Differing from today’s human resources managers, people in these jobs will analyze data collected from exoskeletons, smart textiles, wearables and the like to perform predictive and preventive maintenance on human workers.  Isn’t that nice; sensors will now send alerts to your manager when you’re overworked, overstressed, overweight or otherwise unwell — brilliant!

Recommended educational background: Biology, medicine, psychology

Systems Farmer – people in these jobs will help companies grow large multifunction parts with nanoscale features, which will sense, process, harvest energy and perform self-repairs.  It’s otherwise known as “chemputing” – and it’s likely as unappealing as it sounds.

Recommended educational background: Biology, chemical engineering, chemistry

AI Ethicist – As autonomous systems are assigned more responsibility, people in these positions will make sure AI devices and robots don’t show bias, and will make decisions that best serve the business.  I wonder how well that initiative will turn out?

Recommended educational background: Math, history, philosophy

Kidding or snark aside, it is worthwhile to “navel-gaze” along these lines and think of the “what if” scenarios that could very likely paint an employment picture unlike anything we’ve ever contemplated before.

And indeed, BAE Systems fielded research that found that nearly half of people between the ages of 16 and 24 who were surveyed think that they’ll end up having a career in a job that doesn’t even exist yet.

The only problem is – practically no one surveyed had any sort of clue what that future job will be — or how to prepare for it.

What do you think about which jobs will have the most job security in 2040? Does the list above ring true, or are there others that deserve a place on it as well?  Please share your thoughts with other readers here.

Evidently, America isn’t in IKEA’s manufacturing future …

Going, going, gone …

Over the past several years, the political mantra has been that jobs are now coming back to the United States – particularly manufacturing ones.

That may well be. But this past week we’ve learned that IKEA plans to close its last remaining U.S. production facility.  The iconic home furnishings company has announced that it will be closing its manufacturing plant in Danville, Virginia by the end of the year.

The Danville plant makes wood-based furniture and furnishings for IKEA’s retail store outlets in the United States and Canada.

The reason for the plant closure, as it turns out, is a bit ironic. According to IKEA, high raw materials costs in North America are triggering the move, because those costs are actually significantly lower in Europe than they are here.  Even accounting for other input costs like labor that are higher in Europe, shifting production to Europe will keep product prices lower for U.S. retailers, IKEA claims.

So much for the notion that imports from Europe are overpriced compared to domestically produced ones!

The Danville plant isn’t even that old, either. Far from being some multi-story inefficient dinosaur left over from a half-century ago, the manufacturing facility opened only in 2008, making it only about a decade old.  At its peak the plant employed around 400 people.

IKEA made staff cuts or around 20% earlier in the year, before following up with this latest announcement that will wipe out 300 more jobs in a community that can scarcely withstand such large economic shocks.

With the closure of Danville, IKEA will still have more than 40 production plants operating around the world. It employs around 20,000 workers in those plants (out of a total workforce of ~160,000, most of which are employed in the company’s vast retail and distribution business activities).

So, it doesn’t appear that IKEA will be exiting the manufacturing sector anytime soon.  It’s just that … those manufacturing activities no longer include the United States.

As a certain well-known U.S. political leader might say, “Sad!”

What are the most stressful jobs in America?

Soldier, firefighter and police officer positions are obvious, but jobs in media are right up there, too.

It’s human nature to complain about workplace stress. But which jobs are the ones that actually carry the most stress?

If you ask most people, they’d probably cite jobs in the military, police and firefighting as particularly stressful ones because of the inherent dangers of working on the job. Airline pilots would be up there as well.

And yes, those jobs do rank the highest among the many jobs surveyed about by employment portal CareerCast in its newest research on the topic. But of the other jobs that make the “Top 10 most stressful” list, several of them might surprise you:

Most Stressful: CareerCast Stress Scores by Profession (2019)

#1. Enlisted military personnel (E3, 4 years experience): 73

#2. Firefighter:  72

#3. Airline pilot:  61

#4. Police officer:  52

#5. Broadcaster:  51

#6. Event coordinator:  51

#7. News reporter:  50

#8. PR executive:  49

#9. Senior corporate executive:  49

#10. Taxi driver:  48

According to the CareerCast research findings, based on an evaluation of 11 potential stress factors including meeting deadlines, job hazards, physical demands and public interaction requirements, more than three-fourths of respondents in the 2019 survey rated their job stress at 7 or higher on a 10-point scale.

The most common stress contributors cited were “meeting deadlines’ (~38% of respondents) and “interacting with the public” (~14%).

Upon reflection, it’s perhaps understandable why workers in media positions feel like they are under particular stress – what with “fake news” claims and a constant barrage of criticism from both the left and the right which can go beyond being simply irritants into some much more stress-inducing.

What if someone wanted to make a career change and switch to a job that’s at the opposite end of the stress scale? CareerCast has identified those positions, too.  Here are the “least stressful” jobs as found in its 2019 research results:

Least Stressful: CareerCast 2019 Stress Score by Profession

#1. Diagnostic medical sonographer:  5

#2. Compliance officer:  6

#3: Hair stylist:  7

#4. Audiologist:  7

#5. University professor:  8

#6. Medical records technician:  9

#7. Jeweler:  9

#8: Operations research analyst:  9

#9. Pharmacy technician:  9

#10. Massage therapist:  10

Interestingly, one might assume that the most stressful jobs in America would carry a commensurate salary premium, but that doesn’t turn out to be the case.  The average median salary for the Top 10 “most stressful” jobs in America is hardly distinguishable from those of the Top 10 “least stressful” jobs – differing by only around 4%.  It seems like those latter workers are onto something!

More information about the CareerCast findings can be viewed here.

Reuters: In 2019, publishers will experience “the biggest wave of layouts in years” … and massive burnout among the journalists who remain.

The bad news continues for the publishing industry in 2019.

I’ve blogged before about the employment picture in journalism, which has been pretty ugly for the past decade.   And just when it seems that news in the publishing industry couldn’t get much worse … along comes a new study that further underscores the systemic problems the industry faces.

The results from a recent Reuters survey of publishers worldwide point to declines that will only continue in 2019.  In fact, Reuters is predicting that the industry will experience its largest wave of layoffs in years, coming off of a decade of already-steadily shrinking numbers.

The main cause is the continuing struggle to attract ad revenues – revenues that have been lost to the 600-lb. gorillas in the field – particularly Facebook, Google and Amazon.

Growing subscription revenue as opposed to a failing attempt to attract advertising dollars is the new focus, but that will be no panacea, according Nic Newman, a senior research associate at Reuters:

“Publishers are looking to subscriptions to make up the difference, but the limits of this are likely to become apparent in 2019.”

In addition to boosting subscription revenue, publishers are looking to display advertising, native advertising and donations to help bankroll their businesses, but advertising is the main focus of revenue generation for only about one in four publishers — a far cry from just a few years ago.

Putting it all together, Reuters predicts that it will lead to the largest wave of publishing job layoffs “in years” – and this in an industry where employment has been shrinking for some time now.

With yet more layoffs on the horizon, it’s little wonder that the same Reuters research finds employee burnout growing among the employees who remain. As Newman states:

“The explosion of content and the intensity of the 24-hour news cycle have put huge pressure on individual journalists over the last few years, with burnout concerns most keenly felt in editorial roles.”

A major reason why:  Even more is being asked from the employee who remain – and who are already stretched.

Journalism salaries are middling even in good times – which these certainly are not.  How many times can an employee be asked to “do more with less” and actually have it continue to happen?

Even the bragging rights of journalists are being chipped away, with more of them relegated to spending their time “aggregating” or “curating” coverage by other publishers instead of conducting their own first-hand reporting. That translates into perceptions of lower professional status as well.

In such an environment, it isn’t surprising to find editorial quality slipping, contributing to a continuing downward spiral as audiences notice the change — and no doubt some turn elsewhere for news.

Last but not least, there’s the bias perception issue. Whether it’s true or not, some consumers of the news suspect that many publishers and journalists slant their news reporting.  This creates even more of a dampening effect, even though in difficult times, the last thing publishers need is to alienate any portion of their audience.

How have your periodical and news reading habits changed in the past few years? Do you continue to “pay” for news delivery or have you joined the legions of others who have migrated to consuming free content in cyberspace?

(For more details from the Reuters research, you can sign up here to access the report.)

How disruptive will artificial intelligence be to the jobs we know?

With artificial intelligence seemingly affecting everything it touches, one might wonder what AI’s impact will be on the employment picture in the years ahead.

It’s something that AI expert and author Kai-Fu Lee has thought about in depth. Lee is the former president of Google China and the author of the best-selling book AI Superpowers:  China, Silicon Valley and the New World Order.

Recently, Lee published a column in which he described ten job categories that he feels are “safe” for human workers – regardless of how the AI world may develop around us.

His list is predicated on several fundamental weaknesses Lee sees with AI in handling certain aspects of job performance. Those weaknesses include:

  • An inability to create, conceptualize or manage complex strategic thinking
  • Difficulty handling complex work that requires precise hand-eye coordination
  • An inability to deal with unknown or unstructured spaces
  • The inability to feel empathy and compassion … and to react accordingly
Kai-Fu Lee

In short, Lee discerns a particular weakness in AI’s ability to perform “humanistic” tasks – ones that are personal, creative and compassionate.  Hence, the type of jobs that rely on such qualities will be safer from disruption, he believes.

As for career categories that Lee singles out as generally safe from AI disruption, he cites these ten in particular:

Computer Science – Lee predicts that a substantial portion of computer engineers, IT administrators and technology consultants will continue operate in job functions that aren’t automated by technology.

Criminal Law – The legal profession won’t be adversely affected, considering the persuasive powers that are needed to sway juries with legal arguments.  However, some paralegal tasks such as document review will likely migrate to AI applications.

Management – Simply put, there are too many “moving parts” to management – and aspects that require human interaction, values and decision-making – to make it a field that’s amenable to AI.  Of course, if a manager is more along the lines of a bureaucrat carrying out set orders, that type of job may be more susceptible to AI disruption.

Medical Care – Lee envisions a symbiotic relationship between humans and AI — the latter of which can help with the analytical and administrative aspects of healthcare but cannot handle most other healthcare responsibilities.

Physical Therapy – Dexterity is a challenge for AI, which makes it unlikely for AI to replace jobs in this field (also including massage therapy).

Psychiatry – Positions in this category, which encompass social work and marriage counseling in addition to strict psychiatry, require keen emotional intelligence which is the domain of humans.

R&D (particularly in AI-related field) – While some entry-level R&D positions will become automated, increased demand for R&D talent will likely outnumber the jobs replaced by AI.

Science – According to Lee, while AI will be of tremendous benefit to scientists in terms of testing hypotheses, it will be an amplification of the discipline rather than taking the place of human creativity in the sciences.

Teaching – While AI will be a valuable tool for teachers and schools, instruction will still be oriented around helping students figure out their interests and providing mentorship – qualities that AI lacks.

Writing – Specifically fiction and other creative writing, because “storytelling” is an aspect of writing that AI has difficulty emulating.

So, there you have it – Kai-Fu-Lee’s fearless predictions about the job categories that will remain safe in an increasingly AI world. Can you think of some other categories?  Please share your thoughts and perspectives with other readers.

Rough commutes are taking a toll on employees.

I wonder how many people chafe at the long commutes they face to-and-from work each day?

In my case, the work commute is a little lengthy, but at least I’m in the car, moving.  Other people I know deal with traffic gridlock, which is as frustrating as it can be soul-crushing.

Several others brave the elements with public transportation — transferring across several bus routes in hour-long commutes that could otherwise be completed in one-third the time.

As it turns out, there’s a good deal of restiveness when it comes to work commutes. Employment and staffing firm Robert Half Associates found this out when it surveyed ~2,800 working adults earlier this year across 28 U.S. urban markets.

Robert Half discovered that nearly one in four of the workers surveyed have quit at least one job during the course of their careers because of inordinately long or difficult commuting times. And among the 28 urban markets studied, the highest incidence of changing jobs because of a problem commute were for workers residing in the Chicago, Miami, New York and San Francisco metro areas.

Interestingly, it’s younger workers (those between the ages of 18 and 35) who are the most likely to have left jobs because of a bad commute. Is it because of raising young families, or simply wanting more unfettered free time?

As for commuting trends in these urban markets, about one in five of the respondents surveyed report that their commute has become worse in the past five years. On the positive side, twice that percentage report that their commute has actually improved, while the balance report little or no change in their commuting conditions.

San Francisco and Austin residents report worsening work commutes, whereas workers in Miami, Los Angeles, New York and Charlotte are most likely to report that their commutes have improved over the past five years.

The Robert Half survey results underscore the view that rough commutes can have a major negative impact on morale – and ultimately, on employees’ decisions to stay with or leave their place of employment.

No wonder a growing number of companies are offering nontraditional employment programs — where showing up at the office daily is no longer the only way to be on the payroll.  We’ll probably see more of these arrangements in the years ahead.