Creating jobs - before it's too late

I read an exceptional article this week.

Andy Grove, one of the most famous and successful businessmen of the post-war era (CEO of Intel for 18 years; Time magazine’s man of the year, too many awards to mention), penned a thought-provoking challenge to traditional globalization thinking. 

At the core of Grove’s malaise is that the much-referred-to engine of US jobs growth – the start-up company – does not in fact generate a broad range of technical jobs.

Some interesting points from the article:
-       There is a rough 1:10 law with US technology companies, meaning their China (manufacturing) workforces are about 10 times larger than their US employee base.  Apple has 25,000 in the US; 250,000 in China.  Similar numbers for Dell, Seagate Technology, etc.
-       The ability to export low-value jobs and retain the majority of the profits in-country may be true – but what about the long-term societal impact?  In his words: “…what kind of a society are we going to have if it consists of highly paid people doing high-value-added work -- and masses of unemployed?”

For me, Grove’s most unique point is regarding the connection between ‘low-value’ jobs and future industry innovation and domination.  He puts it far more eloquently than me: “…abandoning today’s “commodity” manufacturing can lock you out of tomorrow’s emerging industry. Our fundamental economic beliefs, which we have elevated from a conviction based on observation to an unquestioned truism, is that the free market is the best economic system -- the freer, the better. Our generation has seen the decisive victory of free-market principles over planned economies. So we stick with this belief, largely oblivious to emerging evidence that while free markets beat planned economies, there may be room for a modification that is even better.”

Remember - this isn’t in Socialist Worker’s Weekly, it’s the coverstory of a leading magazine, written by one of the sages of the modern business age.  A very well-written article, full of moments to make you pause. 

Full article here

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Image © Todd Wheatland - Blogus Picturas

Fringe-Dwellers

Everywhere I go, I see them.

Next-door to the 5* hotel I stayed at in Moscow last week, dozens of migrant workers from former socialist states, living in tiny airless boxes alongside the building they were constructing.

On the way back from the airport in Paris, small towns of cardboard and canvas shanties squeezed in besides the highway.

In the fields surrounding the rustic villages of Sicily, hundreds of young African men hiding in ruins and trying to find work.

In California and Florida, tourists on their way to happy Disney adventures tearing past thousands of illegal migrants picking fruit in the sweltering heat.

In Southampton, Long Island, maybe the richest village in the world, dozens of Latinos standing by the side of the streets seeking day-work.

Thousands of Africans hiding in the hills in the south of Spain, fighting with newly-unemployed locals, all desperate for work, any work.  Thousands of Afghanis holed-up outside Calais, risking their lives for a smuggled crossing of the English Channel.

Walls, trenches, borders, patrols, helicopters, drones, night-vision, heat-sensors.  Legal, semi-legal, grey-state, illegal.  Documented, undocumented, contracted, uncontracted, temporary, short-term, immigrant, asylum-seeker.  No end of terms to help us pigeonhole these people.

I don't mean emergency-relief tents in Haiti.  Not civil-war displaced persons UN camps in Darfur.

I mean everyday, where you live.   Maybe you see the fringe-dwellers too.

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Image © Peeter Viisimaa

Unemployed or Overworked?

We see it, we feel it, we hear it.  Waves of job-cutting have left companies' internal resources stretched like a piano wire.  The economic news has been so sustainably bad, and signs of recovery so weak, that employees have put up with pay freezes and additional work pressures because they feel privileged just to have someone writing them a regular paycheck.

If things are so bad that their very employer may be likely to go under, people have an extra incentive to suspend their short-term focus on sane working hours and expectations of 'fair' compensation as their survival instinct kicks in.

No surprise then that after more than 2 years of doomspeak in the US, the piano wire is fraying.  The Corporate Leadership Council's 1100-company quarterly survey has found that the average work required of an employee has grown by an additional third since the beginning of the recession.  Isn't that an incredible number? 

On the employee side, survey after survey confirm that people believe they are working much harder, and do not feel that their extra effort is appreciated by their employers.  In one recent survey of 1,000 people in the UK, over half believe that their current level of work is unsustaibanle, and that they are treated as dispensible commodities.

How is this demonstrating itself within organizations?  As summarised succinctly in the Economist recently, "Absenteeism is on the rise. Low-level corporate crime is growing.  Corporate loyalty is on the wane."  According to the earlier CLC research, the level of disengaged workers may have doubled, and the number of people willing to put in additional discretionary effort may have halved. 

Something tells me that may not be a good thing for employers.

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Image © Todd Wheatland - Blogus Picturas