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The Conference Board Review® Article
Will We All Be Unemployed?
Looking ahead to our place in the next economy.
By Matthew Budman
Matthew Budman is managing editor of Across the Board. He wrote "With Fresh Eyes" in the Nov/Dec 2003 issue.
When we hear about manufacturing jobs moving overseas—whether in steel, cotton, textiles, or Buicks—it doesn't sting all that much anymore, unless, of course, a family member is among the pink-slipped unlucky. Somehow it seems inevitable—progress, even: The United States is continuing its forward movement, leaving behind the remnants of the Industrial Age and bringing its diverse workforce into the Information Age, ready to lead the way.
But news of software-programming and radiology positions being outsourced to Romania and India has a more visceral impact. Few knowledge workers—and aren't we all supposed to be knowledge workers now?—foresaw their livelihoods being jeopardized by the same free-market principles that have devastated U.S. manufacturing.
Yet technology and toppling trade barriers have left white-collar jobs as vulnerable to overseas migration as those in blue-collar industries. And U.S. workers may not even be the first choice to run call centers or manage the information that is the new economy's lifeblood: Americans are expensive, what with 401(k)s, ergonomics requirements, health care, vacation days, and life insurance, and most have little educational or training advantage over their foreign counterparts.
"I'm nervous," says the ordinarily buoyant management guru Tom Peters. "I don't think there's any job that's safe right now."
"Is the anxiety justified? Absolutely," says Dow Chemical ideation leader Andy Hines. "We're facing a real challenge."
After all, notes USC management professor Ian Mitroff, "if finance and engineering-design jobs can be moved offshore, what can't be moved?"
If you find the trend disquieting in principle, check out the numbers: A recent U.C. Berkeley study estimated that some 14 million U.S. white-collar jobs—11 percent of all jobs—are at risk of being outsourced, anytime employers want to make the move. That's significantly higher than the widely reported Forrester Research forecast of 3.3 million jobs lost over the next 15 years, not to mention the 2.5 million manufacturing jobs lost in the last three years. And who can blame U.S. companies for looking east for lower personnel costs? The Berkeley researchers, Ashok Deo Bardhan and Cynthia A. Kroll, note that Indian telephone operators earn under $1 an hour, payroll clerks just $2, paralegals $8 or less.
The baby boomers' retirement will stave off any true white-collar crisis for a few years—employers will be scrambling for warm bodies, and anyone who fits that description will probably get by. But for far-thinking organizations, the coming demographic shift is another argument for moving operations offshore even faster. In five or 10 or 20 years, will there be any work for knowledge workers—or their supervisors—to do?
Of course, few forecast a future as bleak as all that—U.S. workers have survived every previous disruption, major and minor, and they'll survive this one. It's the disruption's severity and duration that are in question—and whether top-tier workers will be able to maintain their position in the global economy.
Granted, not everything can be outsourced. Despite improvements in videoconferencing and the ubiquity of cell phones, plenty of jobs—even white-collar jobs—require face-to-face contact. We haven't—and won't—become "a nation of burger-flippers," as Lee Iacocca once feared; the service economy hasn't trumped the information age. Whatever the Internet's reach, society can't function without doctors, social workers, and police officers. The economy will continue to need trainers and researchers and economists and teachers and lawyers and editors—and executives to manage them all.
And there's the not-unimportant fact that work will always be here because here is where workers want to be. The United States remains the world's top destination spot for both well-off emigrants and destitute refugees, all seeking a dynamic, vibrant society as well as economic prosperity. Sure, the cost of living is far lower in the developing world, but America is where people want to come&151;and stay. It may be cheaper to start a software-development firm in Ghana or the Philippines, but how many U.S. entrepreneurs would gladly relocate their families from Ohio or Massachusetts?
So should we be worried about our prospects a decade or two down the line? What will it take to stave off downward mobility—individual and collective—and decline both economic and social? We asked some thought leaders with their eyes on the future, including a few who proudly call themselves futurists, to peer at what's ahead for American executives and knowledge workers.
Comments? Write a letter to the editor.
Return to the January/February 2004 The Conference Board Review® issue.
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