Rethinking the
workplace: Flexibility, fairness, and enlightened automation
People
aren’t powerless in the face of new technologies; the future of work is up to
us.
What sort of workplace should
we expect in the future? How will automation affect jobs? How benign is the so-called gig economy? And what will
it take for governments and companies to create “better” work? James Manyika,
chair of the McKinsey Global Institute (MGI), sat down recently to discuss
these and other issues with Matthew Taylor, chief executive of the London-based
Royal Society for the encouragement of Arts, Manufactures and Commerce (RSA),
following publication earlier this year of an independent review of employment
practices in the modern economy, which Taylor led.What follows are edited
excerpts from their conversation.
Flexible practices
Matthew Taylor: Overall, the UK does very
well on the quantity of work, and we provide a lot more
flexibility than many other labor markets. One of the things we’ve been looking
at has been the widespread rise of the independent-work, or the gig, economy;
the phenomenon has been there for a very long time but it has become
particularly visible where it’s digitally enabled, where people are doing
car-ridesharing services or other kinds of things like that.
When self-employment
growth started in the UK after the global crisis, there was a sense that people
were choosing self-employment because there were no jobs available. It was
involuntary. But actually, as the economy has improved, self-employment has not
fallen. It is continuing to rise, though perhaps not at quite the same pace.
We are seeing more
people working postretirement age, and wanting to work in a way that they can
control. We are seeing more people who simply want more autonomy and flexibility
in their lives, in the way that self-employment can offer it. New digital
platforms facilitate that: they make it easier for people to work in exactly
the way they want to work. The challenge is to make sure that we exploit that
opportunity to give people the kind of work they want, in the circumstances
they want it, in a way that is fair and sustainable.
James Manyika: I agree. Some of the research
we’ve done about independent work and the gig economy—we’ve looked at five or
six countries including the UK and the United States—shows that the majority
who do independent work actually do it because they prefer it.
Matthew Taylor: About two-thirds.
James Manyika: They prefer the flexibility
and the independence. Quite often, these are people with unique skills who find
that they can deploy them across a much larger number of users, or customers.
But about a third are
doing this out of necessity, and the necessity comes in a couple flavors.
Either because they actually can’t find traditional employment, something you
find in countries like Spain. Or they’re doing it because they don’t earn
enough from a full-time job and are trying to supplement their incomes. So you
find that this other third is concerned about income stability and the
variability that comes with that. Portability of benefits tends to affect even
those who prefer the flexibility, but it becomes very acute for the ones who
don’t.
Good gigs, bad gigs
Matthew Taylor: There are two additional
concerns that people have about gig working. The first is that we might see the
emergence of very, very powerful companies that then have a kind of
monopolistic position. And secondly, what is sometimes called the Uberization
of jobs. One of the things we heard in our visits to people around the UK [when
writing our report] was that business models were being undercut by gig
working.
So, for example, at one
hearing we heard from the head of a removals firm [a company that transports
people’s or companies’ possessions when they move to a new home or office]. He
told us he was employing people and paying their pensions. This is what he’d
always done. But now he is competing with a removals firm down the road that is
pretending that the men who work there are self-employed. I would say that is
erroneous self-employment, but they were claiming and getting away with the
idea that they were self-employed.
James Manyika: It’s important to look at the
other side of that, too. With a lot of independent work in the modern gig
economy, there’s usually a very large group of happy users and consumers of
these services. Whether it’s a car-ridesharing or any of these task-oriented
services, quite often that need was either too expensively served with other
traditional mechanisms or not served at all.
You’ve seen examples
where services now pop up in places where the traditional versions didn’t
previously exist, whether it’s places where taxis never used to go, poor
neighborhoods, or places where you couldn’t find accommodation.
Matthew Taylor: I think this is exactly the
point. These new technologies—sharing, gig work—offer enormous opportunities,
not just in terms of improving the quality of service, but in terms of giving
people flexibility and potentially disintermediating. The people who provide
these services can own the platform that they use.
We could see the rise
of mutuals and cooperatives and new business models based on the fact that you
don’t need a headquarters and all the bureaucracy that goes with it. You can
just have a place and an algorithm. And you can start to enjoy the economies of
scale that come with that. But we need to do this in a way that is fair to
those workers, fair to the market as a whole, and also sustainable in that
governments need taxes.
What can companies do?
James Manyika: The question for employers is
how do they think about giving their workers the kind of flexibility that they
need—choices about working hours, working conditions, working style?
The other thing that
companies need to think about—and this might also even include the platform
companies—is how do they provide a mechanism for ratings or benefits to move
around with workers? How do they help workers stabilize their incomes, because
we know when people are on these platforms, one of the biggest concerns is the
variability of incomes.
Matthew Taylor: There’s a difference between
two-way flexibility, which these gig platforms often provide—as a worker you
can choose exactly when you want to work—and one-way flexibility. We have a
problem in the UK with one-way flexibility, in which organizations basically
are trying to transfer risk onto the shoulders of the most vulnerable
workers—for example, in forms like zero-hours contracts or lower-hours
contracts. Here the employer says, “I can only guarantee you two hours a week,
but I’ll normally want you to work 30 hours a week.” That means if there’s any
downturn, they can immediately throw that risk onto the worker. It also means
that workers have fewer rights around, say, unfair dismissal and may feel that
if they stand up or question decisions, they won’t get any hours in the future.
The opportunities,
though, are huge. There’s a major supermarket group in Britain looking at an
app that enables their workers to work overtime in any store they want to. If
they are working in a particular part of the store, those workers will know
what other parts of the store they could work in, given the skill set they’ve
got. This is opening up to lower-paid retail workers the kind of flexibility
that middle-aged IT consultants enjoy.
The importance of ‘good’ work
James Manyika: Is the quality-of-work issue
really about incomes, or is it about other things?
Matthew Taylor: It’s a great question. What
do we mean by “good” work? We know that wages matter to people, particularly
those who are less well off. People are less concerned with the relationship
between their wage and the superrich than they are between their wage and the
person who might be one step above them in hierarchy, for example. So people
want to see a decent wage and they want to see fairness. But once you move
beyond that, overall surveys show that people say pay is a less important part
of what determines whether work is good than it used to be in the past.
People want a sense
that their work is meaningful, that they are doing something useful, something
that they can feel proud of. They want autonomy, to feel that they are able to
make judgments and make choices at work, that they are not simply a cog in a
machine. You could call it mastery. The sense that, “I am getting better at
something, and in getting better at something, I am enabling myself to have
more choices in life as a consequence of the job that I’m doing.” And then
there’s teamwork, camaraderie, the sense that I am part of an organization that
is inclusive and fair.
We need to show a lot
more imagination about how to bring those things to lower-paid, lower-skilled
jobs. Many of us who are middle class and work in great organizations are used
to this. But there’s no reason why jobs in caring, in retail, in security, or
transportation can’t have those qualities, if we’re clever about the way in
which we manage our organizations.
James Manyika: At MGI, we’ve looked at the
income part. And we know that one of the things that’s changed dramatically in
most advanced economies is that the rate of income progression has just
stalled. Huge chunks of workers in these countries have seen their incomes stagnate
and decline.
If you compare decades
previous to 2005 and ask what proportion of households in most advanced
economies saw their incomes stagnate or decline, it was in the single digits;
for the United States it was less than 2 percent. Whereas if you look at the
period from 2005 to 2014, for the US, that number was 81 percent.
For the UK, it was 70 percent. In previous decades, you’d have said that even
though we had waves of inequality, at least most people’s situations, the vast
majority of them, were progressively getting better.
Matthew Taylor: Maybe we now have a
generation of people who have got out of the habit of thinking they’ll be
better off next year than they were last year. Maybe that’s leading to kind of
a postmaterialism with people saying, “Well, if I no longer aspire to be
individually rich, what matters to me is that at least I can live in a society
that looks after people, and where I feel that there is a hospital there when I
need it, a school there when I need it.”
James Manyika: I’d be curious in this sense
to what extent, say, the UK is different from the United States. In the United
States, some sociological research suggests that how people feel about
themselves and how well things are going has got less to do with what I might
call post distributional income and living standards—when you’ve taken into
account the disposable income after tax and other government transfers and
distributions—and more to do with market incomes, meaning what they’ve actually
earned by doing something in the marketplace.
When we showed some of
this research to sociologists, they said, “Of course, this makes sense in the
context of the United States. People have never voted on the basis of the
postdistributional effects, but more on the market-income effects, which means
am I getting better off or not?” So raising minimum wages, raising incomes,
making sure people are earning more as they work—that’s going to have a bigger
effect on how people feel about themselves than simply solving the
postdistributional standard of living.
Matthew Taylor: Many voices for some time
have argued that we have got to get off the growth treadmill, but those have
been voices in the wilderness. We’ve seen the illnesses of affluence, whether
it’s obesity or mental health or anxiety. What I find intriguing is this sense
that maybe we are at a turn in which people are starting to say to their policy
makers—and you’re right, Britain may be very different from America—“Don’t
promise us that we’re going to be 2 percent better off every year. That’s a
hollow promise. Promise us that we will live in a society that actually works,
where it feels as though it’s a good place to live. It feels as though our
lives have a quality to them; we have flexibility; we can balance work and
family life.” After all, we have always known that in mature democracies, once
people reach a certain level of affluence, the relationship between wealth and
well-being becomes very thin.
Changed expectations?
Matthew Taylor: We talk about living
standards, and we simply see it in terms of disposable income with some kind of
inflation deflator. But actually, 20 years ago, in order to have access to the
world’s libraries, in order to have access to the best films, the best shows,
in order to be able to communicate with people on that side of the world, you’d
have had to have been very rich. Now you just need to have a mobile-phone
contract.
James Manyika: When we look at things like
technology and globalization, by and large, they’ve given us choices and
utility and a whole set of things. But as one political scientist reminded me
the other day, he said, “Well, you forget one thing, which is that people don’t
vote as consumers; they vote as workers.”
If people voted as
consumers, we’d all be fine because we’ve delivered choice; we’ve delivered the
Internet; we’ve given them all these things that have made life infinitely
better: access to education, entertainment, all the rest of it. If that was the
question, we’d all be fine. The problem is, when people express their points of
view as voters, by and large, they’re voting mostly as workers.
Impact of technology
James Manyika: Back in 1964, President
Lyndon Johnson commissioned a report and a study, the blue-ribbon National
Commission on Technology, Automation, and Economic Progress, to look at
automation and technology in work. I remember one striking conclusion captured
in a phrase that said that technology destroys jobs, but not work. And the
reason why that’s interesting is that there are still lots of things to be
done.
Matthew Taylor: We’ve done a lot of work at
the RSA on the impact of automation on low-paid, low-skilled jobs. And I think
our argument would be that a lot of the hype—that about 30 percent or 20
percent or whatever number of jobs is going to dissipate—isn’t particularly
helpful. Those predictions have, generally speaking, been wrong in the past. I
think you need to look at it in a much more nuanced way. It’ll be less about
whole jobs going; it’ll be more about the nature of the tasks changing.
What I slightly worry
about at the moment is that in our breathless talk about robotics and
artificial intelligence [AI], we lapse into a kind of technological determinism
that says that human beings must do whatever the robots and the AI make
possible. And I want to say, “No, let’s start from the notions of good work and
good lives, and then see how can this amazing stuff enable us to take the
drudgery out of work, but leave the stuff that’s really interesting?”
How can it make public
services much more efficient so we can improve peoples’ quality of education
and healthcare? We’ve had a lot of conversations at the RSA that start with
numbers and technology and its possibilities. They nearly always end up, within
an hour, with people talking about politics and talking about choices.
Important choices
James Manyika: What do you think are some of
the most important choices that we as a society will have to make?
Matthew Taylor: I think we need to make
choices about what we invest in. It is a very big argument, of course, but we
tend to underplay the role that government has historically played in
technological innovation. We need public–private partnerships, and I think government
plays an important role in issuing and supporting challenges to entrepreneurs
and innovators about the kinds of problems we should be solving: green energy
or more efficient forms of care or better types of healthcare.
Whatever we do with
machines, we don’t want to get to a stage where human beings are the slaves.
And I think we’ve got
to worry about market power. I know that often the people who run these firms,
they’re young and they’re funky and they give lots of money to charity, and
they seem well-meaning. But let’s go back to what we know about what happens to
monopolies in the end. This technology needs to be available to lots of
organizations, lots of people. It doesn’t need to be hoarded by a small number
of extremely rich corporations.
James Manyika: And when you think about that
question of power, do you think it’s the same questions about power that we
worried about, say, 100 years ago?
Matthew Taylor: Some of the things we worried
about with monopolies in the past don’t apply in the same way as they do now,
but there are new things. So, 100 years ago people were worried about price
gouging. Now they’re worried about personal information; they’re worried about
intrusiveness. We’ve never had corporations that know so much about us as
today’s corporations do. So we need a conversation about corporate power in the
modern world. Not one that is antagonistic to any individual company, but one
that asks deep questions about what we should be concerned about.
James Manyika: When we think about AI and machine
learning and what these technologies can do, I worry about things like bias:
for example, quite often there’s inherent bias in some of the data. Amplifying
what may historically have been human biases into these algorithmic biases has
enormous scale effect.
Matthew Taylor: I don’t think it’s healthy
when democratically elected politicians feel that they can’t really stand up to
corporations at a national level, or even at a European level.
I would also worry
about wealth. I would worry about the amount of money these corporations have
salted away. And I would make a prediction that if we had another global
economic downturn, the public’s attitude would be, “We’re having your money.” I
think these corporations need to think about whether, if the world was
suffering again, the amount of money they’re sitting on would be tolerable to
people.
McKinsey Quarterly November 2017
https://www.mckinsey.com/global-themes/future-of-organizations-and-work/rethinking-the-workplace-flexibility-fairness-and-enlightened-automation?cid=other-eml-alt-mkq-mck-oth-1711
No comments:
Post a Comment