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It is often past midnight when James McGinnis finds it most productive to toil at the digital frontier. From his home in rural Russellville, Kentucky, he logs on through his PC to check in for work, handling customer service or sales calls.
In a datacentre far away, a computer algorithm makes a quick assessment: how good is he at the job, how many calls are coming in from potential customers, how many other self-employed contractors like Mr McGinnis are hoping to handle them? If he’s lucky, the algorithm will look kindly on him and route enough work his way to produce the $10-15 an hour he hopes to make.
He often works past midnight or early on a weekend morning to improve his chances of getting work. “You can commit [time] and not get any calls when there are 10,000 people taking calls on a program,” he says.
Yet Mr McGinnis enthuses about an existence he judges superior to his previous full-time employment and seems at ease with the digital forces that now rule his life: “The main thing is not the money, it’s the freedom. This is my business; I’m in control of it.”
The technological changes sweeping through working life are having a complex impact as the US struggles with a jobless recovery.
On one level, they are creating opportunities and freedom for people like Mr McGinnis that did not exist before. Work like this might otherwise have been shipped to call-centres overseas, says Maynard Webb, chairman of LiveOps, the company whose online “crowdsourcing” sustains 20,000 independent agents like Mr McGinnis in the US.
But the accelerating rate of technological change is also having unsettling effects: replacing some work completely with greater automation or offshoring, depressing pay for others and forcing workers into part-time, marginalised positions as employers discover how to tap into a new virtualised workforce.
According to a growing band of academics like Erik Brynjolfsson, a professor at Massachusetts Institute of Technology who studies the impact of technology on businesses, the disruption is only set to get worse.
At the heart of the conundrum is why current technological advances, which in previous cycles sustained employment growth even as they have made workers more productive, have become job-devourers.
The past decade marks the only 10-year period in the past 80 years when employment in the US has declined at the same time that productivity has risen, says James Manyika, a director of the McKinsey Global Institute.
Mr Manyika says that while technology is fuelling productivity gains, unlike in the past there are simply not enough truly transformative advances to create the markets and industries capable of putting more people to work. “There’s a shortage of innovation in general,” he says.
Others counter that the problem is just the opposite: technology is advancing too fast for the US economy and society to cope.
The pace of change is so rapid that companies are struggling to invent business models to take advantage of advances in technology, says Mr Brynjolfsson. “The human and software side is not keeping up with the harder, technology side,” he says.
At the most basic level, the spread of IT has cut a swath through the ranks of clerical and administrative workers as automation has spread to the white-collar world.
To some, automation remains a benign force. “Everyone wants more jobs and less work,” says Hal Varian, chief economist at Google. “Technology has tended to automate tasks people don’t want to do.”
Higher pay is one result – though the demand for workers with new types of expertise and stronger analytical and communication skills has exposed a failure of the US educational system to keep up, he and other academics warn. The resulting skills mismatch is the main reason for the widening income inequality of the past three decades, as the better-educated reap a disproportionate share of the rewards from a digital economy, according to work by Harvard economists Claudia Goldin and Lawrence Katz.
As simple tasks or even whole jobs are automated, employers have rearranged the work that remains. That often produces more interesting and varied work, along with a demand for more capable workers, according to research by Frank Levy, an MIT professor.
While automation has eaten directly into some types of work, other technologies are having a more complicated impact. Often, they complement workers in ways that make them more productive or create new jobs – though the rewards may not always accrue to individual workers themselves.
As people like Mr McGinnis have found, the “cloud” – the name given to a pervasive computing infrastructure accessed over the internet – is changing the way jobs like sales and customer service are handled. Individual workers are becoming more productive, conjuring up sales in the middle of the night from their homes.
Digital platforms like the one run by LiveOps are being tried out for many other types of work, from education to law, says Mr Webb. A former president of Ebay – one of the first platforms to provide millions of people with a new way to make money from their home PCs – Mr Webb says that these are breaking down geographic barriers, opening up new work possibilities for millions.
Whether these online marketplaces – which include mobile app stores like those run by Apple – will provide many people with a decent living is a different matter.
Like Hollywood in the 1920s or Detroit in the early days of the car, some of these highly fragmented new activities will consolidate, leaving a handful of winners, argues Mr Varian.
Others, such as Mr Brynjolfsson, say two of the basic characteristics of IT – the way it cuts costs and enhances the free flow of information – will make it hard for most people to make much money.
Technologies with even bigger impacts on workers, meanwhile, could be just around the corner. Two of the biggest dreams of the information age – robotics and artificial intelligence – appear close to a stage where mass deployment is no longer a fantasy.
Washington has spent most of 2011 fighting over the US deficit but Congress has spent precious little time looking for ways to get Americans back to work
Two recent breakthroughs have made the point. With its self-driving car, Google has demonstrated the potential of machines capable of interpreting and reacting to their surroundings. Meanwhile, IBM’s Watson computer has surprised even experts in the field with its ability to “understand” language and answer questions previously thought beyond the reach of machine intelligence.
Which types of human work these advances might make more productive – or replace – are still unknown. At risk will be low-skilled jobs that, ironically, have been among the least threatened by technology in the past: manual work that relies on an ability to navigate and interpret the world, something machines could not do before.
Whatever the impact on today’s jobs, though, it is the new industries – and wealth – created by big breakthroughs like these that will define the future of employment. Robotics is the leading candidate for “the next boom”, says Mr Varian. “There’s a trillion-dollar impact on the economy when that starts showing up in consumer products.”
The nature of the jobs that follow such sweeping advances is hard to predict. “When the car came along, I’m not sure Henry Ford foresaw suburbs and supermarkets and Walmart,” says Mr Brynjolfsson.
But while the jobs of the future have yet to be revealed, the job losses and disruption to working lives from accelerating technological change are already apparent.