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The Dim Future Of Knowledge Workers

Tue, 09/27/2011 - 5:25am
Michael P. Collins, Author, Saving American Manufacturing

Mike Collins
In 1984, the best-selling book Megatrends by John Naisbitt predicted that the American economy would shift from manufacturing to a service economy and become a nation of information (or knowledge) workers. He said that there was great opportunity in becoming the "world's leading provider of information, knowledge and expertise." He also challenged the reader that it was OK to abandon our traditional industries (like manufacturing) that other countries can do better.

He was suggesting that we would transition from an industrial to an information society. He suggested that "Most Americans would spend their time creating, processing or distributing information." Naisbitt suggests throughout the book that there would be ample opportunity for everyone as long as you got a good education and were computer literate.

Well, Naisbitt was correct in his prediction of the decline of American manufacturing and the transition to a service economy. But his rosy picture of the "information society" did not turn out to be so rosy. His book suggested we would transition to a nation of knowledge workers happily creating, processing and distributing information for very good wages. My impression was that he was suggesting that we didn't need manufacturing, and the economy could continue to grow at 4 percent GDP and create enough jobs for everyone.

Well, it just hasn't happened and the future of knowledge workers (much less the middle class) is in doubt. So what has happened to change the information society dream? The first thing to look at are middle class standards of living, which in the past, helped millions of Americans get to the American dream and allowed each generation to be better off than their parents. In the last 10 years, living standards for most workers have stagnated as expenses and debt rise. This was caused by the disappearance of manufacturing and union jobs, aggressive marketing of consumer debt, tremendous pressure by corporations to reduce wages, and the Great Recession.

"From 1999 to 2008, the price of milk has risen 35 percent, ground beef 54 percent, eggs 128 percent and gasoline 244 percent, government data shows. Yet middle-income Americans saw their yearly household incomes fall by $408 during that period when adjusted for inflation according to the Census Bureau."

What are disappearing are the jobs in the middle, the good-paying jobs above $20 per hour with benefits. The current economic situation looks like a barbell with growth of jobs on both ends and a small shrinking bar in the middle. At one end, you have minimum-wage jobs for hamburger flippers, retail clerks, etc. On the other end, you have growth in professional jobs that take a lot of education and training, such as doctors, engineers, lawyers and so on.

The problem is providing enough knowledge-type jobs for the middle class. It is useful to review the Labor Department's occupational employment projections from 2008 to 2018, entitled "Occupations with the largest job growth." This is not all of the jobs that will be created in the 10-year period, but it projects the 30 categories with the largest job growth and those that are most likely to employ people in the middle class.

The chart of 30 job categories reveals that the job categories marked very high (over $51,545 per year) require a minimum of a bachelor's degree in a professional field and sometimes a doctoral degree. These professional jobs account for only 9 percent of total. Jobs.

On the other hand, all of the jobs marked very low (less than $21,590) or low ($21,590 to $32,380) are 57 percent of the occupations with the highest growth. Hence, we have a barbell image with a predominance of professional jobs on one end and low-wage jobs on the other. The other 34 percent of the jobs are the bar of the barbell and they pay between $32,390 to $51,545 per year.

One of the big trends that none of the futurists saw coming, which would have dramatic effects on their vision of the information society and knowledge worker jobs, was the offshoring of knowledge jobs. The futurists did predict that computers would be in every home and be ubiquitous in our society. But they did not foresee that computers and their components would be manufactured in Asian countries, and they did not forecast the coming of the Internet.

Once the Internet was introduced to the average business, any job that could be defined into routine tasks and reduced to Os and 1s could be outsourced. Information society jobs, such as travel agents, accountants, engineers, software programmers, actuaries and telephone services, have been outsourced. More than 50 percent of banking and financial firms are outsourcing their back-office work. These jobs were from the middle of the barbell and paid decent wages.

So unless you have enough education and training to get a professional job, the future is dim, if not grim, for knowledge workers, and I don't think we can count on the information society improving living standards of the middle class. And this trend also begs the question of just how many doctors, lawyers and professors we need in the new economy?

A good example of the plight of the surviving knowledge worker can be found in the excellent book Shop Class as Soulcraft by Mathew Crawford. After getting his master's degree and undergoing a traumatic job search, Crawford landed a job as an indexer and abstractor. The job was to read academic articles, index them under established categories and then write 200-word abstracts that would be sold to libraries.

It was truly a knowledge worker job that fit the definition of creating, processing and distributing information. Crawford wrote 28 abstracts every day in his cubicle with a desk and computer, and no windows. He was a well-educated "cubicle drone" working for $23,000 a year.

Crawford says, "How was it that I once was a proudly self-employed electrician and ended up among the walking wounded, a knowledge worker." He goes on to say, "Once I had a master's degree, I felt like I belonged to a certain order of society, and was entitled to its forms. Despite the beautiful ties I wore, it turned out to be a more proletarian existence than I had known as a manual worker."

The idea of transitioning from an industrial society to a post-industrial society, dominated by a nation of well-paid knowledge workers happily laboring over their computers to create and process information, has turned out to be a race to the bottom.

Occupations with the Largest Growth 2008-2018

Employment

Median Annual Wage

2008

2018

Registered nurses

2,618.70

3,200.20

VH

Home health aides

921.70

1,382.60

VL

Customer service representatives

2,252.40

2,651.90

L

Combined food preparation and serving workers, including fast food

2,701.70

3,096.00

VL

Personal and home care aides

817.20

1,193.00

VL

Retail salespersons

4,489.20

4,863.90

VL

Office clerks, general

3,024.40

3,383.10

L

Accountants and auditors

1,290.60

1,570.00

VH

Nursing aides, orderlies and attendants

1,469.80

1,745.80

L

Post-secondary teachers

1,699.20

1,956.10

VH

Construction laborers

1,248.70

1,504.60

L

Elementary school teachers, except special education

1,549.50

1,793.70

H

Truck drivers, heavy and tractor-trailer

1,798.40

2,031.30

H

Landscaping and grounds keeping workers

1,205.80

1,422.90

L

Bookkeeping, accounting and auditing clerks

2,063.80

2,276.20

H

Executive secretaries and administrative assistants

1,594.40

1,798.80

H

Management analysts

746.90

925.20

VH

Computer software engineers, applications

514.80

689.90

VH

Receptionists and information clerks

1,139.20

1,312.10

L

Carpenters

1,284.90

1,450.30

H

Medical assistants

483.60

647.50

L

First-line supervisors/managers of office and administrative support workers

1,457.20

1,617.50

H

Network systems and data communications analysts

292.00

447.80

VH

Licensed practical and licensed vocational nurses

753.60

909.20

H

Security guards

1,076.60

1,229.10

L

Waiters and waitresses

2,381.60

2,533.30

VL

Maintenance and repair workers, general

1,361.30

1,509.20

H

Physicians and surgeons

661.40

805.50

VH

Child care workers

1,301.90

1,443.90

VL

Teacher assistants

1,312.70

1,447.60

L

45,513.20

52,838.20

The rankings of the Occupational Employment Statistics survey annual wage data are presented in the following categories: VH = very high ($51,540 or more), H = high ($32,390 to $51,530), L = low ($21,590 to $32,380) and VL = very low (under $21,590). Wages are for wage and salary workers.

Michael P. Collins is the author of the book Saving American Manufacturing. You can find more related articles on his website via www.mpcmgt.com.

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