Many of us remember from economics 101 that land (resources), labor (skills) and capital as being the main factors of production; with entrepreneurship serving as a smart blender in how these factors are combined to produce marketable goods/services.
A producer (factory owner) may substitute one factor for the other with the intent of increasing efficiency, enhancing quality, reducing cost, etc. Here, the inanimate factors are mostly freely traded (regardless of market imperfections), and readily substitutable. Labor, however, never goes down quietly. And that for understandable reasons. Humans are not only factors but also end users of what is produced. Besides work has a significant contribution to our self-worth.
The virtue of our time, the fast convergence of advances in biotechnology, computing and behavioral psychology is challenging the conception we had about labor and work. And it is strongly hinting into rendering labor totally obsolete altogether.
At the risk of sounding fatalistic, take this for visualization: the recent tech-advances appear to be intending to pick labor up by the collar, toss it out from the production function and label it “persona non grata”. If we belief Yuval Harari, the work and its environment may be changed beyond recognition by 2050. Which got me thinking… what would we be using in place of what we now call labor market?
Yuval Harari as well as other scholars and technologists have extensively written about the quick transformations that will be pushed onto us as a result of advances particularly in AI (Artificial Intelligence). In fact, this is not being touted as a probability but a certainty. And some contend, in the face of such inevitability the best governments can do is work for controlled transition; spread the shock over a longer period.
Now, let’s just close our eyes, think what the COVID-19 has done to the possible future trajectory, and contemplate what the possible outcomes will be adjusted post COVID-19. Let me put mine here:
1. Given the technological promises of our time, COVID-19 has pulled the rag from under our feet when we are most vulnerable. It has proven that humans are the least reliable factors in the production function- a nail to the coffin!
2. Following point 1, the likelihood that the transition may neither be controlled nor managed is a real possibility. Meaning technology will lead and the rest will follow. Take it a little further, our life course will be charted out for us by entities that do not have “skin in the game” when it comes to the concerns of the public.
My gut feeling tales me the sector comprising high-teck industries (those within IT, robotics, AI, etc) is the sector to watch out for. I challenge friends in my contact list who are better acquainted with the working of the financial markets to enlighten us more.
Stay safe!
@ፍትዊ ጥቅምቲ 2020
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