Friday, March 29, 2013

Why Technology Is No Longer Creating Jobs

This is not specifically about the 50-plus but they are involved, as much as any other age group in what is being discussed - where are future jobs going to come from?

If you want the bottom line answer - it isn't going to be large online companies.

 Just think about this for a moment. Apple, Amazon, Facebook and Google have a market capitalisation around a $1 trillion. This is approximately 6% of the combined market cap of all U.S. companies.

How many people do these companies employ? Just 190,000 people.

Sure there are other people employed as a result of these companies - subcontractors and suppliers and people that are employed as a result of the money their employees spend. Whatever way you cut the numbers, replicating four of the most successful companies on the planet is not going to employee all of those people who are unemployed.

OK, here is another fact for you to contemplate. In the US, 15% of college students study science, technology, engineering and mathematics (STEM). In China the figure is 40% and in Germany the figure in Germany is 28%.

I dread to think what it is in the UK.

These figures and a lot more can be found in a fascinating article in the Wharton Business School newsletter.

The most likely area for job growth will be small companies utilising STEM skills. As the article concludes: "There is no better time than right now to be an entrepreneur who can make use of all these new technologies, but there is no worse time to be a worker with no special skills, because all of those jobs are being automated."

The reality behind these numbers is having a profound impact on the job market. Dick Stroud

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