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How To Create Jobs In The Age Of Robots And Low Growth

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The growth economy suffers from a productivity paradox. Corporations compete to reduce the time and effort that goes into production processes, which is generally seen as a sign of efficiency, but in reality has a troubling outcome.

Unless more stuff is produced and consumed, people lose their jobs as the same output can be achieved with fewer workers. This is why so many well-meaning people around the world fear the prospect of low growth, even when they recognise that the current form of industrial development is destroying the social fabric and natural ecosystems of societies.

Such a structural unemployment problem is further compounded by the real prospect of massive automation replacing humans in production chains. A study by Oxford University predicts that robots are likely to displace no less than 50% of jobs in the US and Europe in the next 20 years.

Machines are putting people out of work in emerging economies too, including in China, which has long been the global job creator. According to Martin Ford, bestselling author of The Rise of the Robots, most routine jobs are becoming obsolete. As Ford says:

We must decide, now, whether the future will see broad based prosperity or catastrophic levels of inequality and economic insecurity.

Unless societies change their approach to growth and development, they will not only end up with a broken planet and conflict-ridden communities: they will also face massive unemployment. There is no way the vertical structures of production dominating the current industrial system will generate enough jobs, let alone good jobs, to satisfy our needs.

Tesla’s secret formula

As I describe in Wellbeing Economy: Success in a World Without Growth, the only way out of this predicament is to empower people to become producers and consumers at the same time. Or what I call “prosumers”. They must be capable of making most of the things they need through local systems of co-production and networks of small businesses.

And certain technologies can help develop a new form of post-industrial artisanship. Thanks to open source hardware, small business networks are building computers. With the assistance of 3D printers, artisans are taking on big business in a way that may challenge conventional assumptions about the efficiency of economies of scale.

Changing the focus

Rethinking work is crucial for industrialised economies as well as emerging economies, where job losses are being felt even in the presence of substantial, although diminishing, economic growth.

For instance, Africa is expected to achieve a record 2.8 billion people by 2060, becoming the largest continent in the world. Most of these people will be young and thirsty for work. There is no way the continent will create decent employment opportunities by adopting an industrial model that’s already eliminating jobs globally.

The Nerd Herd

A new approach is needed. The well-being economy forces us to rethink the nature of work by shifting the focus from the quantity of the production-consumption cycle to the quality of the relations underpinning the economic system. The growth economy pushes for mass consumption through an impersonal relationship between producers and consumers (which can be more efficiently performed by robots). The well-being economy must embrace a customised approach to economic exchanges, in which it’s the quality of the human interaction to determine the value.

Take a doctor as an example. From the perspective of the growth economy, the best doctor is the one that visits as many patients as possible in the shortest period of time. In theory, this function could even be performed by a robot. By contrast, in the well-being economy, the personal attention invested in the doctor-patient relationship becomes the key to value creation.

Intuitively, all of us associate the value of good health care with the personal attention that comes with it. The same holds true for education: any reasonable person would frown upon a school that asked teachers to teach faster and faster to an ever larger number of students. Common sense tells us that value is being lost through the mass consumption of these relationships, even when profits (both for the clinic and the school) may increase.

Rethinking productivity

Productivity is certainly a good thing, but it should not be embraced blindly. Above all, we need to ask what productivity is for.

The economy is nothing else than a system of social relations. If productivity undermines those relations, the economy itself crumbles, even when profits (at least for someone) may go up.

Many professional activities based on the quality of the performance cannot, by their own nature, become more productive. Asking an orchestra to play faster would not increase productivity: it would simply turn a melodic experience into a nightmare. The same applies to painters, dancers, barbers, teachers, nurses and the like.

This is why it still takes the same number of people to play a Mozart opera today as it did when Mozart first composed it. So, what about extending the same intuition to the rest of the economy?

Young, Jobless And Angry

What if the mechanic of the future won’t be a robot churning out new spare parts every second, but rather a qualified artisan that helps us fix, upgrade and upcycle our vehicle for the entire duration of its life? What if the engineer of the future won’t be a remote computer taking care of our house appliances but a personal advisor helping households produce their own energy. They would help optimise the use of natural resources, from water to vegetable gardens, and make sustainable use of building materials?

A circular economy in which production is optimised and no waste is produced can be achieved in two ways. It can be achieved through robots-dominated production chains or by a horizontal network of qualified artisans and small businesses operating as a collaborative organism. In the first case, a few people will dominate the global economy. In the second case, everyone will be empowered.

A well-being economy cannot exist without empowerment, access and equal opportunities for personal and collective fulfilment. Developing countries can now leapfrog to such a new trajectory without being held back by a model of industrialisation that’s increasingly unfit for the 21st century. – Written by Full Professor of Political Economy, University of Pretoria

Originally published in The Conversation.

The Conversation

Lists

The Five Trends To Future-Proof Your Business

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Some of these fads were slowly building in the previous decade, others are still nascent, but need your full attention to prepare your business for the times ahead.

1. AI and machine learning

Key takeaway: Automate repetitive tasks, but be wary of automating inefficiencies and biases.

You’re surrounded by artificial intelligence (AI) and machine learning: from the recommendations Netflix makes based on your viewing history to those pesky adverts that track you around the internet. As Bronwyn Williams, a trend analyst at Flux Trends in South Africa, explains, “Most of what you think is AI is actually machine learning.” Williams emphasizes that fears about AI “stealing jobs” are overrated, and most businesses will see the arduous, repetitive tasks given to machines, freeing up humans for analysis and critical thinking. She warns businesses to remember it’s the human interaction that differentiates one offering from another. “Don’t automate away your value. Look under the hood and make sure you understand why you are automating something – and be careful not to automate inefficiencies.” Looking at automated HR processes, companies have discovered that even unconscious human biases are learned by machines (for example, CVs belonging to certain genders and races are discredited. Machines are not born neutral – especially if they’re learning from humans.) Embrace machine learning, but do so with a pinch of salt.

2. Driverless cars and the supply chain

Key takeaway: Autonomous cars are still about 15 years away, but it’s best to prepare your fleet and supply chain choice now.

The automotive industry is going through some major changes: electric cars, the growth of services like Uber and Lift, and lastly, the development of autonomous vehicles. Though the first two will impact everyday consumer experiences, it’s self-driving cars that will massively alter businesses and their supply chains across Africa in the next decade. “As convenience and efficiency are the cornerstones of the fleet industry, there is no doubt self-driving vehicles will start making a play for their share of the fleet industry sooner rather than later,” explains Sudesh Pillay on fleet management company EQSTRA’s online platform. The supply chain will no longer be affected by driver fatigue and human error. Driverless cars will also dramatically impact accident rates (lowering them by 90%, according to some estimates) and supply chain efficiency. As Innovation Group’s Future Now report indicates, autonomous cars face some serious challenges across Africa before they can become a practical alternative to human drivers. “There is a vision, in the not-too-distant future, in which self-driving cars hold a lot of promise…. Others are more skeptical about the practical feasibility, especially in Africa where the infrastructural limitations (roads, electricity etc.) hold back the vision, at least in the foreseeable future. Our research indicates that self-driving cars may only become a reality in South Africa in [15] or more years and that this may spur innovative advances in infrastructure, energy services and ultimately the look and feel of roads and cities.”

3. Climate crises and

natural disasters

Key takeaway: Hire a Chief Sustainability Officer to

start building climate resilience into your business.

“Now is the time to start thinking seriously about resilience,” says Hugh Tyrrell, Director at Green Edge, a corporate mentoring initiative in Cape Town that helps businesses develop sustainably. “The big brands have Chief Sustainability Officers (CSO). This role is in the C-suite and is forward-thinking,” Tyrell explains. CSOs look at how businesses can start developing their own power, lower their eco-footprint and manage their resources better. Looking to the big corporate trendsetters, there are some major shifts in corporate strategy focusing on a sustainable business model instead of growth at all costs. Unilever, for example, is holding their suppliers to the same eco-friendly standards that they themselves are working at, says Tyrrell. Natural disasters associated with the climate crisis are already affecting African businesses too. Explains Tyrrell, “In agriculture, which is a big sector in Africa, we are seeing the effect of droughts or floods. Others have to work more closely with their suppliers to ensure supplies come in good condition and on time.” Mining is another industry heavily impacted by the climate crisis – and the push by consumers for more environmental-friendly solutions. 

4. The age of cyberattacks and data breaches

Key takeaway: Make sure your IT department includes

skilled data protection specialists.

As businesses innovate and rely less on physical hardware like servers, and start instead relying on the cloud, they can expect to see a massive uptick in cyberattacks and subsequent data breaches. This trend increased exponentially in 2019 (even the City of Johannesburg in South Africa was held by ransomware) and is set to explode in the coming decade. Added to this, businesses are collecting more data than ever before, particularly for marketing purposes and to tailor their product offerings. Because of this, businesses should prepare themselves for the onslaught by firstly, taking their online security very seriously, secondly, training their staff (employees are the weakest link in any security chain) and thirdly, putting more budget behind appropriate security measures. “The demand for narrow cybersecurity expertise is driven by a constantly changing threat landscape, as well as evolving technologies, such as cloud or IoT. As a result, we see the bigger demand in, for example, threat intelligence analysts and dedicated threat intelligence services, and experts for cloud platform protection. The call for data protection specialists is seen in both technical and regulatory and compliance aspects,” says Alexander Moiseev, Chief Business Officer at online security software Kaspersky.

5. The remote workforce

Key takeaway: Flexi-hours and working remotely are practical ways to combat challenges like loadshedding and traffic.

With intermittent power supply (particularly in South Africa), increasing traffic and less reliance on physical IT infrastructure like servers, the remote and flexible workforce is becoming a norm. Says Moiseev, “The working model is already being changed, with 40% of small and medium companies regularly allowing their employees to work at locations outside the office — from home or while traveling.” In addition, health scares like the coronavirus are amplifying these trends. “Apps that enable remote working are having a moment,” explains Williams. “You now get filters to add makeup to video conferences so you don’t have to dress up when you’re working from home.” Many employees expect the flexibility of remote working when job hunting, and businesses reap the benefits of agility.  

-Samantha Steele

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Health

Surge Of Smartphone Apps Promise Coronavirus Tracking, But Raise Privacy Concerns

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Topline: A pan-European team of researchers announced Wednesday their plan to release a smartphone app that would notify users if they’ve been exposed to someone infected with coronavirus, the latest example of tech-driven coronavirus solutions that have also raised concerns about user privacy.

  • A European project called Pan-European Privacy Preserving Proximity Tracing is working toward releasing a coronavirus tracing app in the next week that would use anonymous Bluetooth technology to track when a smartphone comes in close range with another, so if a user were to test positive for coronavirus those at risk of infection could be notified.
  • Contact tracing, or determining people who may have been exposed to someone with a virus, is an established aspect of pandemic control and was used effectively to tackle coronavirus in countries like China, Singapore and South Korea in the form of smartphone tracking.
  • University of Oxford researchers and the U.K. government are working on a similar project— but unlike other smartphone tracking systems, the British version in development would be based on voluntary participation and bet on citizens inputting their information out of a sense of civic duty.
  • The U.S. government is in talks with companies like Facebook FB and Google GOOGL and other tech companies about tracking if users are social distancing using large amounts of anonymous, aggregated location data— this information is less precise, and more likely to anticipate outbreaks rather than pinpoint individuals who have been exposed to the virus.
  • 1.5 million Israelis have voluntarily downloaded a mobile app that alerts users if they’ve come into contact with someone with coronavirus— but Prime Minister Benjamin Netanyahu has still ordered that potential coronavirus carriers have their phones monitored, a controversial move the government says is necessary, as the 17% of the population using the app is not enough to fight off the pandemic.  
  • Moscow , on a city-wide lockdown since Monday, announced Wednesday that a new phone app that will officials to track the movements of people diagnosed with coronavirus in the capital city would be launched on Thursday, saying the government will lend a smartphone to anyone unable to download the app.

Crucial quote: “We’re exploring ways that aggregated anonymized location information could help in the fight against [coronavirus]. One example could be helping health authorities determine the impact of social distancing, similar to the way we show popular restaurant times and traffic patterns in Google Maps ,” Google spokesman Johnny Luu told the The Washington Post. He made sure to note it “would not involve sharing data about any individual’s location, movement, or contacts.”

Key background: Private and public entities alike are looking for ways to fight off coronavirus as the pandemic continues. On Wednesday, there were more than 900,000 confirmed cases worldwide and nearly 50,000 deaths.Officials told The New York Times NYT that The National Health Service, Britain’s centralized national health system, is trusted by citizens— and paired with the strong data privacy laws in place, said they think people would agree to join the effort to share their private information to help trace infections. However, American tech firms are reported to still be skeptical about sharing substantial data with the U.S. government ever since Edward Snowden revealed the NSA was collecting information from the firms clandestinely. 

Surprising fact: The information tech companies have access to data that sheds light on Americans’ behavior in light of the coronavirus pandemic. According to a Facebook analysis, restaurant visits fell about 80% in Italy and 70% in Spain— while Americans only stopped eating out at a rate of 31%.

Carlie Porterfield, Forbes Staff, Business

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Technology

Apple Is Donating 9 Million Masks To Combat The Coronavirus

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Topline: Apple will donate 9 million N95 protective masks to combat the coronavirus, Vice President Mike Pence said on Tuesday, making Apple one of several California tech companies pitching in as hospitals across the country report a shortage of protective gear.

  • Pence thanked Apple for agreeing to donate 9 million N95 respirator masks to healthcare facilities across the country during a press briefing on Tuesday.
  • Pence’s remarks come after Apple CEO Tim Cook tweeted over the weekend the company was “working to help source supplies for healthcare providers fighting COVID-19” and “donating millions of masks for health professionals in the US and Europe,” but did not offer more specifics.
  • N95 respirators are masks that form a protective seal around a wearer’s mouth, filtering  out at least 95% of particles in the air, according to the Centers for Disease Control, which makes them necessary to protect healthcare workers from being exposed to the disease from patients.
  • Facebook has also said it is donating its stockpile of 720,000 masks purchased during the California wildfires last year, which degraded the air quality in the San Francisco Bay Area.
  • Apple did not immediately respond to a request for comment from Forbes asking if all of the donated masks were stockpiled because of the wildfires or if the company got them from somewhere else.

Chief critic: Teddy Schleifer, a reporter at Recode, wrote that health systems shouldn’t rely on the generosity of big tech companies to make up for the failures of the federal government. 

“But there is a risk in relying on corporate philanthropy—rather than the government—in solving this problem. For starters, it depends on the voluntary generosity of these companies to deal with an unprecedented emergency, an altruism that could vanish at any time,” he wrote.

Crucial quote: “And I spoke today, and the president spoke last week, with Tim Cook of Apple. And at this moment in time Apple went to their store houses and is donating 9 million N95 masks to healthcare facilities all across the country and to the national stockpile,” Pence said.

Key background: Apple is one of several California tech companies to give away N95 masks. In addition to Facebook, Salesforce, Tesla and IBM have also announced mask donations.

News peg: Doctors and nurses are sounding the alarm that they don’t have enough masks to protect healthcare workers. Not only does inadequate protective gear put important frontline health workers at risk, public health experts say, any situation endangering medical personnel may only further depletes the U.S. health system which already doesn’t have enough capacity to handle a surge in cases. State officials in New York and Illinois have criticized President Donald Trump for not stepping in to force companies to manufacture masks or allocate masks from private companies to ensure that states don’t outbid each other for the same supplies.

Rachel Sandler, Forbes Staff, Breaking News

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