In 2016, globalization and international trade were marked as the primary culprits in a world economy experiencing dynamic shifts. In the United States, Donald Trump’s surprise election as the country’s 45th president was in many ways a referendum against globalization. So, too, was Britain’s vote to leave the European Union.
Many of Trump’s most ardent supporters are working-class Americans whose jobs have been moved overseas. Similar sentiment supported the pro-leave vote in Britain. And Trump’s tough talk against trade deals such as the North American Free Trade Agreement, enacted in the 1990s, and the seemingly doomed Trans-Pacific Partnership galvanized millions of Americans whose job fortunes languished amid the post-crisis recovery. Trump is now promising to dispose of any deal that moves jobs overseas. He’s even said he would take a hard stance on technology companies like Apple Inc. to move their production back home.
But is globalization really the sole perpetrator of working-class decline? As our cover story shows, something else is at work. While many are quick to blame trade and globalization for the loss in the manufacturing sector, there is another, more dominant, force to be reckoned with: technology.
Independent research from the Brookings Institution, a Washington, D.C.-based think tank, shows that the predominant force behind the recent loss of manufacturing jobs has been technology, not globalization. As Mireya Solis, a Brookings foreign policy senior fellow, wrote in a recent policy brief, international trade has actually had a positive influence on U.S. job growth. What’s more, had the Trans-Pacific Partnership deal passed (at publication, all signs pointed to no), Solis noted that annual increases in real income for Americans were estimated to range from $57 billion to $131 billion by 2032. Meanwhile, Solis wrote that technological innovations such as robotics and 3-D printing, among others, have accounted for about 85 percent of the manufacturing job loss since 1980 by rendering most low-skilled factory jobs unnecessary.
Manufacturing isn’t the only industry that’s been dramatically reshaped at the helm of technology. Today’s technology boom is reminiscent of the Industrial Revolution, when the invention of steam power and the assembly line transformed the fabric of the global economy while also disrupting industries and norms. With the cost of producing the Ford Model T sliced dramatically at the hands of the assembly line, American culture evolved in lockstep with the proliferation of the automobile, creating whole new businesses and industries in the process. Steam power shrunk the time to move goods from one side of the country to the other, further speeding the pace of business.
Similarly, as our cover story shows, today’s emergent technologies — mobile connectivity, automation, artificial intelligence and robotics, to name a few — have already brought deep economic reverberations, with more on the horizon.
The spread of the mobile internet now provides knowledge workers constant connectivity, allowing them to complete work through virtual communication anytime, anywhere. Automation software can sift through complex data sets with minimal human intervention, thus alleviating workers from torturous busywork in favor of more strategic tasks. And artificial intelligence and robotics appear poised to replace even more routine, computational human tasks, threatening the loss of jobs even more.
Each of these developments influences the talent market. Emerging technologies will affect every industry. They will also influence the skills required to operate in the modern economy. This will change how executives make decisions — and alter the course of their leadership skill development to boot.
There’s no doubt that globalization and trade has had a seismic impact on the world economy. But the more pressing issue facing executives, as it pertains to their ability to attract, retain and develop talent, is how technology is continuing to transform the role humans play in global business and society. Ignoring it isn’t an option.
This first appeared in the Talent Economy Winter 2017 Quarterly Journal. Click here to read the entire digital edition of the issue.Filed under: Talent EconomyTagged with: artificial intelligence, Brexit, data, Donald Trump, economy, globalization, internet, labor market, manufacturing, robots, skills, talent, technology