A clear example of this is the use of drone technology by the military. It requires about 100 people to prep and launch and maintain an F-16 for a single mission. Keeping an unmanned predator drone in the air for 24 hours requires about 168 workers laboring in the background. A larger drone, such as a Global Hawk surveillance craft, needs about 300 people working in the background to make the mission feasible. One of the real problems for the Air Force is recruiting enough people with the savvy to fill these needs.
But here’s the problem. The world is dividing into people who can manipulate information using computers and those who can’t. The differential in wages between these groups is significant. Thomas Piketty, the socialist French economist who wrote the book Capital in the Twenty-First Century (an enormously flawed work), does make the valid point that the gap between the poor and the rich, and between the middle class and the rich, is widening. Very little dispute about that. (He really didn’t need to cook his economic data to demonstrate his case.) Enter Tyler Cowen, whose book Average Is Over I have been reading and mulling over for some time now. Cowen says the ability to mix technological knowledge with the ability to solve real-world problems is the key to being a big earners in a polarized labor market. The productive worker and the smart machine are becoming ever more complementary. As one reviewer said, “Only those who can learn to think like smart machines or at least enough to understand their operation will get success. Individuals who work with genius machines will need to retrain and learn new systems constantly.”
So there are reasons to be concerned about my techno-optimist view. The new jobs will only be available to those who have real aptitude and real training. You may be highly educated, with a PhD in music or literature or even in economics, but the demand for your skills is nowhere near as high as the demand for a super nerd who dropped out of college and can sling code in his sleep. If, on the other hand, you understand how to generate leads and new subscribers using Facebook – something that really doesn’t require a computer science degree but does demand a highly focused and integrated understanding of web technology and marketing – you’ll find people lined up to throw money at you.
(Now that I mention it, if you are such a person, send us your résumé. We haven’t cracked the code to achieve sustainable marketing profitability through Facebook, and there are a significant number of others in our industry who are facing the same issue. We are getting better at it. But it seems like every time we think we have it figured out, Facebook and Google and the rest of them change their algorithms, and we have to start all over again, which means that the young geniuses we hire have to figure it all out again. And the cycle seems to be getting faster.)
What triggered my thinking on these topics this week was a lengthy piece by Marc Faber. Faber looks at a question being asked by a couple of other writers: Are the Millennials turning into the new serfs? With the massive amount of debt they have accumulated, not just in student loans (which are horrendous), but also in auto loans and other types of debt as well. With their income-generating potential down from that of previous generations, this generation may be in trouble (a problem I will be writing about in my book on the future of work). Now, Marc writes longer pieces, and this letter was 38 pages; but he gave me permission to pull out a few paragraphs here and there and stitch them together into a shorter piece, which we’ll turn to next. Then I’ll add some final comments on the future of work for Millennials.
Are High Home Prices Turning American Millennials Into the New Serfs?
By Marc Faber
(Excerpted from the Gloom, Boom & Doom Report, March 2017)
Writing for http://www.dailybeast.com (February 4, 2017), Joel Kotkin opines under the title “The High Cost of a Home Is Turning American Millennials Into the New Serfs” that
American greatness was long premised on the common assumption was that each generation would do better than previous one. That is being undermined for the emerging millennial generation.
The problems facing millennials include an economy where job growth has been largely in service and part-time employment, producing lower incomes; the Census bureau estimates they earn, even with a full-time job, $2,000 less in real dollars than the same age group made in 1980. More millennials, notes a recent White House report, face far longer period of unemployment and suffer low rates of labor participation.”
More than 20 percent of people 18 to 34 live in poverty, up from 14 percent in 1980. They are also saddled with ever more college debt, with around half of students borrowing for their education during the 2013–14 school year, up from around 30 percent in the mid-1990s.