The Future of Jobs--A Contrarian View

A few years ago, two people approached me and asked for my opinion of what the job market would look like in about 10 -12 years. I went at an answer tooth and nail pulling together data from a wide variety of sources. Then, as a trial balloon, I sent my forecast out to a few people whose opinions I value greatly. The response was mixed. We will come back to that but first here is my forecast:


By 2027, we will not have a two tiered employment market but actually three.

From what I see today it  will likely shake out as follows:


1) The top 10-12% will be made up of very smart individuals. These sharpies will have mastered the new technologies or will have so much money or power in a firm that they can manage those who have. They will push and likely succeed in making their products or services even more efficient and will garner increasing profits and market share.

2) The next group will not be that large; perhaps 5% of the workforce. These people will not be tech mavens but they will cater to the whims of the top 10%. Personal trainers, interior decorators, financial planners (although index funds will hurt them), SAT Tutors, and household managers will top the list. Suppose an investment banker (a woman) marries a successful surgeon (man). Their income will be huge but the one commodity they will not have much of is time. A manager will be hired who will get the kids to school, pick them up after squash practice, make dinner and do the laundry. They will be paid quite well.

A new servant class will emerge to address the needs of the emerging 2nd gilded age.

3) Things get rough for the group below these two which may be 80-83% of the population. Robots will take some of these jobs and continued growth in offshoring will do even more damage. Lawn services, roofers, building security, some food service and home health care are likely to be here. These jobs can often resist automation as you will need some hands on action. Importantly, you will need less. I saw a video of a coffee shop in the Bay Area that has machines that make a perfect cup of quality coffee (not the dreadful vending machines that "brewed" coffee years ago!) . It had one employee who collected the cash that some customers still used and was there in case of a machine malfunction. So food service jobs will still exist but there will be far fewer of them. A problem, of course, will be that these jobs will ALWAYS have low salaries as one can digest the necessary skills in a few days and you are very easily replaceable.

Now, will all 80-83% have dead end jobs? Of course not. But, and this is important, raises for middle managers will likely be smaller over time and upward mobility will get tougher except for the most resourceful. I have always bristled when people would say “this time it is different.” They say it with real estate or stock market booms or even overpriced media properties. Yet, here I am saying this time it IS different. When The Industrial Revolution came along many people were free to leave the farms and move to urban areas as improvements in farm equipment had made yields higher with less labor. As electricity came along and steel mills started to roar, millions of new non-farms jobs were created. Henry Ford used his assembly line to build cars, paid workers well, and cars came to the masses.  And so it went for decades.

Historically, increases in technology have increased the number of jobs, good paying jobs, too. Now, we face something a bit different. Like many of you, I am fascinated by the future of self drive cars and trucks. What, however, will happen to the hundreds of thousands of truck drivers in the U.S? No, they will not all go away, but major companies will find self drive vehicles safer and cheaper to operate. Efficiency will always win out.

Also, don’t forget Big Data. It will not simply be a turbo-charged marketing tool. As I write people are working on ways for Big Data to measure worker productivity. Workers will be under more pressure than ever and will face greater scrutiny. The coming together of data points will not be dissimilar to your credit score. It will be hard to fight this in performance or compensation reviews.

Right now, some plants are using robots along with people. I read of one where when a night shift is required they go 100% robots as they are more dependable. Schools do more online courses which cut the number of faculty required and do not use up much classroom space or heat or electricity. I would not want to be a 26 year old Latin or Greek professor these days!

The media world is affected, too. As mega-shops place more on line advertising on exchanges, fewer people can handle billions more in billing. The logarithms get more sensitive and effective every day. An acquaintance has told me he loves what they do but is glad he is 60 and can pull a platinum parachute as he leaves his media giant.

Should the top tier get far wealthier due to the efficiency, the flip side is that the bottom 80% but especially the bottom half could get poorer. We have seen how the wealthy have an aversion to tax increases and they have the contacts and deep pockets and influence to fight them. So, we are heading toward a world of the tech haves or financial heavies and the tech have nots regardless of how many of us own the latest smartphone.

When I looked at this almost inescapable trends to deeper inequality in the US, I went back to my first teacher in Economics—Adam Smith. At 20, I read the WEALTH OF NATIONS (1776) for the first time. The father of modern economics taught me the merits of the market system and the tremendous benefits of free trade. In WEALTH OF NATIONS, the great Dr. Smith wrote: “No society can surely be flourishing and happy, of which the far greater part of the members are poor and miserable.” Amazing. He wrote that way back in 1776 but it appears that we are headed that way in the next 10-15 years. What to do? Elect Bernie Sanders or a clone in 2020? No way. That could kill the economy. Smith often talked about the value of unfettered markets but admitted that sometimes they needed a little fettering. While he bristled at his own prescription as government entering in to markets was against what he called “natural liberty”, perhaps a progressive income tax and some careful financial regulation would prevent consolidation of economic power in to the hands of a few. My libertarian friends would argue that unfettered markets are great and that crony capitalism has caused much of the inequity in society. Let me be clear—there will ALWAYS be unequal distribution of income in a relatively free market. Some people are more intelligent, some work harder and some are just plain lucky. Yet, if the trends that I see continue, we will be seriously out of whack.


The response to my thesis has been interesting. A few said that I had read too much science fiction and others said that I was a gloom and doomer.  Some quietly agreed and admitted that they will be on top. I consider myself an optimist but, to me, the handwriting is already on the wall. Companies will use tech to squeeze out costs and as one person said to me several years ago, "Robots and logarithms do not require vacations, sick leave, health insurance, raises or a  401K."

I sincerely hope that I am totally wrong with this hard nosed forecast.  Yet, unless things change in a big way, I do not see how much of it is unavoidable.

If you would like to contact Don Cole directly you may reach him at doncolemedia@gmail.com or leave a message on the blog.