Sunday, June 08, 2014

The End of Growth... at the Office

There is coming a day when we will not have the knowledge workers necessary to maintain our current economy. Technology is great, but it must be built, installed, and maintained by specialists. As far as economic development goes, building the technology is one thing, but it takes a whole new level of economic development to support the necessary technicians.
Now don't get the mistaken impression that I am referring to electronics only. I am referring to any number of advanced processes that have become a part of the business world. Whether it is IT, HR, Accounting, Marketing, Facilities, Electronics, Electrical, etc. and etc., knowledge workers exist on the premise that they can leverage modern techniques to improve the efficiency of a company's operations.
Companies these days are getting squeezed by a long-term economic downtrend caused by expensive oil. They are cutting costs by minimizing wages and minimizing workforce. The existing workforce is being put into multiple roles, paid less, and trained less. As a matter of fact, few companies develop their employees anymore. The hot new job requirement (though it is unspoken) is that you must be able to hit the ground running and train yourself. Even when a "training period" is provided, it is more of a honeymoon period where the new employee tags along with existing workers for a short period.
No development also means no promotion. A skeleton crew is by definition static. There is no place to move because everyone is on essential duty. Furthermore, promotion means more money. So then there is an unspoken "promotion freeze," even if hiring is going on. This feeds back into the lack of development. Why develop employees that aren't going to be promoted anyway; the company risks losing highly-trained employees.
The second facet of this issue is the destruction of college education. Costs are rising to the point where many young people are skipping or dropping out of college. Those who graduate can't find jobs because companies are running lean. All of this means that there is little next generation workforce. Ultimately, there will be no next generation force if present trends continue. The economy is not providing a level of growth that makes college education spending worthwhile, nor is it providing a level of growth that allows companies to provide true apprenticeship and development.
What about people who quit? Certainly replacements will be needed there. What you have to take into account is that the economy is in a long-term contraction trend. Attrition doesn't mean new hires; it is becoming a way for business to ride the contraction down. Another force that is going to help cancel out the upside of attrition is labor arbitrage, or moving jobs to countries where the labor is cheaper.
However, by the time the day comes that we don't have enough skilled workers, our economy will be degraded enough that it won't matter.