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Technology is disrupting the way we work, but itís not all doom and gloom

June 4, 2018 


DALLAS ó Business leaders and experts from around the country gathered at the Federal Reserve Bank of Dallas this week to talk about nothing less weighty than the rapid, relentless and widespread disruption of the economy enabled by fast-moving technological advances.

If that sounds far out, conference speakers were there to assure anyone with a job or who may ever need a job that itís not. Here are five takeaways:

1. Schools must change the way they teach ó and some are already doing so.

El Paso Community College created a transportation center that can help retrain truck drivers whose jobs are expected to be displaced by autonomous trucks by teaching them related skills like diesel tech or logistics, according to William Serrata, the schoolís president.

Paul Quinn College in Dallas describes itself as an "urban work college," its President Michael Sorrell said. It requires students to work a few days a week and attend classes other days. The jobs give students ó the majority of whom are on Pell grants ó the chance to graduate with a work transcript and connections that create a pipeline to employment. In the fall, it plans to launch a program for alumni that allows them to return to college and learn new skills, if their jobs are displaced by technology.

Other experts highlighted the need for better early childhood education ó something the Dallas Fed has helped advocate for in the Dallas-Fort Worth area.

2. Training and reskilling programs arenít keeping pace with technology change.

"While training efforts are being beefed up at very rapid levels, they probably arenít being beefed up fast enough to keep up with disruption," said Dallas Fed President Rob Kaplan. He said the programs must also grappled with the cultural and emotional obstacles of mid-career and middle-aged workers who may be hesitant to return to the classroom.

Jan Rivkin, a professor at Harvard Business School, said heíd like to see the private sector offer solutions. He said heís worried by how quickly technology is causing companies to shed jobs and how slowly workers are getting retrained. He said he spoke to a well-known venture capitalist, who he did not name, who wanted to invest in companies retraining people ó but couldnít find any.

The venture capitalist told him he realized he had invested in companies that caused job losses and "as a citizen, Iíd like to be able to sleep at night." Rivkin said part of the problem is that the private sector is displacing people and the public sector is retraining them.

3. The workforce of the future will look different ó smaller, in some cases, and demanding different skills.

Dallas-based telecom giant AT&T has about 250,000 full-time employees in the U.S. ó with about 20 percent of those at call centers ó but that number will fall in the years ahead, chief financial officer John Stephens said. Some jobs will disappear and others will require new skills, such as data science and software proficiency instead of ability to lay cables. Thatís why the company has a massive reskilling program that encourages the legacy telecomís employees to take college classes and get "nanodegrees."

"When you go from cable connecting telephone poles to spectrum in the sky, you have different jobs," Stephens said. At the bottling plant of Coca-Cola Beverages Florida that employs about 5,000 people, CEO Troy Taylor said the company is investing more than a million dollars to reengineer its 15 manufacturing lines to make them more efficient. The result, he said, will be a smaller workforce that helps analyze data, such as tracking beverage types that sell well in certain grocery stores and geographic regions and using that to inform production and distribution.

4. Disruption by technology may be accelerating, in part, because of changing demographics. Companies are turning to technology because they feel squeezed.

With a low birth rate and aging Baby Boomers, companies see technology as a way to drive down costs and drive up profitability. For example, with more efficient bottling lines, they can drive down costs and drive up profits, Taylor said.

Former chief executive of Plano-based J.C. Penney Mike Ullman said department stores and other retailers must get creative to attract customers to their stores and compete with online retailers like Amazon, since Baby Boomers are at the point in life when they donít need many new clothes.

Mark Duggan, director of the Stanford Institute for Economic Policy Research, said that the use of technology to make health care, in particular, less labor-intensive could help drive down costs.

5. Itís not all doom and gloom, though. All this automation makes being human more important than ever.

Patrick Harker, president of the Philadelphia Fed, said that technology is changing faster than ever. The only constant "comparative human advantage," is that humans can be creative. And thatís something we need to foster in workers, he said, so teaching the humanities and creativity should be top priorities ó even if more and more jobs are in STEM fields.

Sam Schulhofer-Wohl, a senior economist with the Chicago Fed, also argued that as economists and policymakers talk about the high-level labor market implications of automation and technology, they donít lose sight of a fundamental truth about people and their work: "Thereís much more to a job than how many hours you work and what you get for it," he said.

For many, he said, jobs are sources of meaning and happiness.

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