Disrupted – How We Earn A Living

I am wondering if I am the only one who has noticed that there seems to be a disconnect in the employment/unemployment stats that we are seeing in North America & and other developed nations.

Companies are claiming that they can’t find qualified candidates.  The unemployed are saying they can’t get jobs or interviews.  While there is a general amount of structural unemployment (jobs are not where the potential employees are located) or vice versa, much of this can be overcome by technology if both companies and individuals are willing to step back from the the traditional 19th century paradigm of what constitutes an employee, being someone who works at a specific place, during specific hours, with a specific job description or duties to perform, under direct on-site supervision of someone.

Long-term unemployed face a whole other problem, even with retraining and other government sponsored programs and a good education, the prospects can be bleak.  One article that I read stated that it will take you 2 months plus 1 month/$10,000 in annual salary earned to find a replacement job, so as an example a person who earned $70,000/year would take about 9 months to find a new comparable job, likely at a lower salary.  If you are unemployed for over 12 months your chances of finding another job in your old career path drop by about 75% and approach zero should you be unlucky enough to find a job after 18 months.

Here are a few of my observations:

Companies want to hire experience…but seem not to want to pay for experience or pay very little for training, if this was not true we wouldn’t have a youth unemployment rate, Canadians 15 – mid-20’s of over %15 officially, and unofficially as high as 25% if you start counting the under employed, people not working in their credentialed professions and often working multiple jobs that still don’t approach a traditional full-time work week.  In the USA and much of Western Europe the stats for youth are similar.

At the other end of the spectrum are those that are experienced been in their profession for 10 – 20 years, age; 35 – 45, and thus have made some amount of salary progression.  I have read several articles that suggest that age discrimination in hiring decisions is happening to candidates as young as 40 in some industries and in general has moved lower from 55+ to the late 40’s for certain.  In an era where life long employment situations are non-existent, it is a death sentence to be layed off in your 40’s if you are not prepared to radically shift your idea of employment and work, and I have first hand experience being unemployed at 43, (4 years ago) when my employer went broke with a high skill set but missing one or two certifications that people normally have working at the level that I was working at.

Just who exactly are companies hiring.  From my observations it seems to be an extremely narrow demographic.  They don’t want to train so they aren’t hiring the under 25 group, and they don’t seem to want to pay the salary expectations for the over 40 group or they will hire in this group should the individual be able to consider a significant reset in salary progression, hard to do when you have committed to long term things like Children, Mortgages, and Car Payments.  No wonder companies can’t find the employees that they say that they desire.

Don’t even get me started on Job Board sites, in my opinion, its just like when I was younger and got involved in online dating sites,  looking at hundreds or possibly thousands of profiles, but there was always the possibility of finding something better so I kept looking…and wasting my time where there were so many wonderful datable women available and all I had to do was take a chance with a few of them.  I believe that many employers are effectively doing the same thing, looking for perfection that may not exist.  I have seen so many jobs in my local area come up time and time again, through one head hunter, then another, then another, then back to another job board as the company looks for that perfect fit rather that hiring close and training for the balance, they do nothing but recruit for months and months…gee I guess having an HR manager isn’t really so crucial to your operations after all.

All of this while we see the rise of the contract service economy, currently growing at an estimated 25%/year.  I believe the verb that has recently been used is “Uberization” of the economy.  At any rate it is the rise of the technology enabled freelancer, the individual as the value added link in the chain, just brows Fiver where I had a fantastic logo for my business designed for $5 in only a couple of days.  You can get almost any task, even fairly complex things done by boundlessly creative individuals for only $5 bucks.  By some estimates I have read that by 2020, 50% of employment will be generated by freelance contractors, many of these contractors will be doing freelancing as a sideline, but many more are graduating from part-time to full-time E-lancers, Electronic Freelancers.  This is nothing really new, Thomas L. Freedman covered this in the third edition of his book ” The World is Flat”

Technology is also bringing great benefit to the ability for individuals in developing nations to earn an above subsistence income.  From the Indian and Philippine Call Centres to my brother-in-law’s company in Nepal, Cloud Factory, millions of people are being given the opportunity to rise out of poverty through a convergence of technologies.

But what about the person who truly wants to work in a traditional “Job”, as many in their forties would like to, and I would say most in their 50’s & 60″s would prefer the traditional work arrangement they have been accustomed to.  I would like to share the story of one IT professional who was downsized a few years ago,  He lived and worked in Ontario, Canada, His name is David Gay.  As much as technology is, I believe freeing the average worker, his story is troubling and disturbing.  I am sharing this story without his permission but as the link is to a public profile & blog chronicling his ordeal, I believe he wants his story to be shared.  One would also think that as an IT worker, he would be more prepared for the disruption that technology is putting on the traditional work arrangement, but he was truly unprepared.

He has only ever worked for a couple of companies but by all accounts he was a good and effective employee, but had worked for too long in one place and by that virtue was likely expensive in terms of re-hire after being laid off.  Perhaps some of his IT skills were somewhat dated, but again he went out and did some upgrading.

If you are unemployed; you do have an expired date, a date after which you are likely to become permanently unemployed; David is till looking for a traditional job, doing almost anything, and now homeless.  All because he does not want to “Contract or Freelance”  which is the new reality of a “Disrupted World of Work”

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One thought on “Disrupted – How We Earn A Living

  1. Some great insights here. I hate to admit it but the desire to hire in the 25-40 year old range for the reasons you talk about are true for our company as well. I think this has a lot to do with culture fit and ROI of hiring an employee. We do hire a lot fresh out of college in one of our markets and develop “homegrown talent” through training, but it is expensive and challenging. If a lot of training is required for fresh graduates that is an investment, and the LTV (lifetime value) may not be high because they often use their first job or two as stepping stones and move on. If they do stay you are paying for their training AND having to give aggressive raises to retain them during this inflection point in their career and salary.

    We also look at a lot of people 40-60 and find it hard to validate the price tag. If the wisdom and experience does not translate into ROI for your business then the hire doesn’t make sense. A lot of it is not only related to how fast the skill requirements are changing but also the culture and general approach to work. Flatter organizations, constant change, more agile and iterative approaches to work are something that many senior employees who have been in the workforce for 20-30 years are not able to adjust to as well. And culture fit has to be at the top of any company’s hiring criteria.

    So 25-40 year olds with a culture fit and a good ROI that are still “hungry” to grow and accomplish things ARE very attractive to companies. It doesn’t seem right but it does seem to make sense why the Goldilocks “not too hot / not too cold / just right!” approach to hiring is so rampant. Is there a correction ahead? Will the market (salaries) adjust to some of these new realities? Interesting for sure.

    Liked by 1 person

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