We can’t think about the future of work and automation without first looking at the history and tendencies of capitalism and digitalization.
The demise of conventional capitalism relies on our disposition to remain stagnant, ignorant, and unwavering to innovation and change. However, digitalization is changing all of this.
Digitalization is increasing access and broadening the scope of production in society, ultimately causing the workforce at large to become increasingly out of date and irrelevant in its conventional form.
On the effect side of this cause, the workforce is changing dramatically, causing our entire society to advance into a position where there are more opportunities for wealth, social equity, and environmental conservation.
These changes are resulting in companies replacing workers with automation from the newest technologies, and workers are leaving the labor force in massive quantities because there are more alternatives for an individual to be productive and generate an income on their own.
All of this is happening at rapid rates never seen before.
In this article, I’ll explore the future of work and automation, focusing on the evolution of society from standard capitalism to the new age of microcapitalism as a key factor shaping the future of labor and industry.
The microcapitalist manifesto
Microcapitalism is an economic theory based on productive property in as many private hands as possible. Favoring small business and small government, Microcapitalism provides a reasonable alternative to unrestricted capitalism and the injustice of socialism.
The Microcapitalist Manifesto book by Paul Edward Nowak explores what went wrong with runaway capitalism and the overreaction of socialism, and identifies steps every citizen can take to encourage responsible, limited capitalism without big business and big government interference.
The corporations: Forced innovation
Capitalism is self-perpetuating in that depending on the situation, it needs either minimal or zero deliberate intervention to evolve. The subconscious nature of capitalism forces expansion and innovation.
Businesses and individual workers are a microcosm of the overall capitalistic system. Businesses are built on systems and processes that can run like pieces of an engine in a car, making up the larger entire engine, our economy, in the end generating an overall outcome.
In order to produce better engines of economy, we must produce better and more efficient parts, parts meaning companies and workers. This is called forced innovation.
Forced innovation comes from external pressures, rather than by a self-starting desire to improve or create.
In general, companies won’t self-improve or innovate unless they’re forced to, and they typically won’t do it well if they do decide to voluntarily innovate in new areas, because in the past, innovation has been unconditionally expensive and difficult for companies, with more of them failing at innovation than succeeding.
The reason for this derives from the very history and nature of capitalism. A pack of lions would be foolish to think that the supply of gazelles would remain endless without some different ways of thinking. The pack of lions would go hungry without otherwise venturing out into new territories or exploring new food sources, such as zebra. So, on the back of exploration and venturing out, the pack of lions survives and expands their dominance.
Thankfully, the human race is able to venture out, explore, and come up with new inventions every so often, resulting in many reasons why we’ve increased life expectancies and an expanding presence across the universe.
In the primeval era, people only did business with things they could see, feel, and touch. However, this approach isn’t necessarily moving society forward. Therefore, economies of the time were by nature stagnant and atrophic. So society found a way to invest in our intangible futures with something called credit, also known as venture capital. This realization became what we know today as capitalism.
Capitalism requires innovation, and whether we innovate or not, it makes winners and losers out of all of us. Forced innovation requires a response.
The COVID-19 pandemic is a great example of this forced innovation. Capitalism by its very nature isn’t natural human instinct, and this is why it’s so hard for companies to succeed and innovate. Hence, many don’t, and opt to not fix what isn’t broken.
In contrast, if something can be better, then it’s broken already. With the COVID-19 pandemic, we’ve seen a rapid rise in automation and digitalization due to the need for social distancing technologies. All of this has resulted in a significant growth of digitally and data-driven organizations from remote work.
Particularly with manufacturers during the pandemic, we saw the fragile nature of our existing workforce and its vulnerability from manually run organizations. COVID-19 marked the “forever transition,” where companies have now adopted a new school of thought - automate as much of the human components of the workforce as possible.
Now, with our digital economy and the need for automation due to the explosion of technologies like augmented reality, blockchain, artificial intelligence, quantum computing, and semiconductors, we have permanent forced innovation, at least for the 21st century.
In other words, as artificial intelligence continues to mature and while other technologies successfully integrate with artificial intelligence, companies will need to innovate quickly and preemptively for at least the next several decades.
Now, because of this forced innovation, we’re seeing more and more that with automation, businesses can reach more customers in shorter periods of time with better products by using machines instead of humans. By removing humans from mundane, laborious, repetitive, and dangerous tasks, businesses can cut labor costs and put more resources towards innovation and competitive gain.
As companies put more and more resources towards innovation, eventually we’ll see a progressive move to companies with fewer and fewer workers, and eventually many companies with no workers, but only administrative, contract, and owner staff.
So, when the economy’s workers aren’t traditionally employed, then what happens?
The workers: Dealing with automation and capitalism
For the first time since its inception 500 years ago, conventional capitalism is on its deathbed, but capitalism itself isn’t dead. Why? Because workers see a way out of the repetitive and symbolic “hamster wheel”, thanks to digitalization. They also don’t really have a choice with so many organizations looking to automate their workforce.
The concept behind capitalism is that it must feed on itself, and that’s how it gets bigger. Digitalization and automation have been happening since the 1940s when semiconductors emerged, and it only picked up speed in the 1990s with the emergence of the internet and mobile devices.
Can it get infinitely big? The answer is no, not in its current approaches. Conventional capitalism is becoming a supernova about to implode upon itself because it’s reaching its critical mass. When supernovas explode, they release their debris far into space, and this massive debris makes new stars, planets, and sometimes, even life.
This is why we’re becoming a microcapitalist society. In other words, we’re moving away from the haves and the have-nots and we’re creating new stars. So you can think of the current state of the labor force in the same way as an exploding supernova, creating new stars and new life into the economy; new products, new jobs, and more prosperity.
How are we doing it? Well, companies are really leading this initiative as they become more and more innovative in order to stay competitive and deliver better, cheaper products.
Over the decades, we’ve seen big movements towards more automation happen several times, such as in the 1980s when the auto industry laid off thousands of workers or the same thing that happened with the collapse of the steel industry in America during the 20th century.
During the latter 20th century, the auto and steel industry suffered massive worker displacement from the emergence of computer-aided design (CAD) manufacturing capabilities, once again, eliminating repetitive tasks and making companies more competitive on a global level by providing better and safer consumer products.
The result did eliminate jobs, but also created many more jobs such as computer programmers and technicians.
During this workforce transformation, we’re in the midst of, we won’t see total displacement. We’re seeing and trending toward an increase in contract workers and a decrease in full-time workers.
During COVID-19, when companies reduced their workforces, workers followed in agreement and just decided not to come back. So we have a declining workforce because of this, and also because of an aging population and declining birth rates.
With a declining workforce, it’s important that corporations act with foresight and automate their workforce tasks where there’ll likely be worker shortages.
However, this doesn’t mean corporations are forever devoid of workers should they need them. There are still plenty of people wanting to work, just not as many in the traditional employment capacity. Corporations will need to rely on contractors and solopreneurs to bring on-demand innovation and expertise for specific business cases.
At present and in the future, it won’t be uncommon to see one person with 3- 4 fractional corporate jobs at any given point in time. Workers will quickly gain new and diverse experiences as a result that further support automation and increased prosperity, in the end producing potential entrepreneurs who can build new products and companies that can make our world cleaner, safer, and more enjoyable.
According to McKinsey, just 6 out of 10 occupations have only 30% of tasks that are automatable. So, looking past all the fear-mongering, the reality is a maturation of the market where there’s transitioning happening coupled with some temporary displacement, rather than a complete elimination in various areas of the labor force.
Fortify your position for the future
As the evolution of microcapitalism continues to be an ever-emerging key factor shaping the future of labor and industry, the global production economy will need to respond in order to stay competitive. If corporations and workers both adopt traits of microcapitalism, they can likely survive in the new world.
Corporations will need to source and procure strategies, processes, and malleable products that are all flexible to future changes.
Secondly, corporations must database and build relationships with full-time employees, contractors, entrepreneurs, and solopreneurs across a wide range of industries and geographies in order to have a holistic and complete innovation engine filled with machine automation and key personnel roles.
Adopting this approach will empower and enable an arbitrage-like preemptive culture and response system to shifting market conditions.
Not all of the workforce will be displaced, so relax! However, don’t sleep on the shifting market conditions or you’ll certainly be left behind. The emergence of automation is happening everywhere and in every industry across the globe, so no one is obsolete from the shifting market requirements.
Only a small portion of the workforce will be totally displaced, but what seems to be happening is that workers need to retrain or potentially pick up entirely new trades.
To be competitive, workers must pursue education in economics and artificial intelligence. People will need to choose technical domains to specialize in, e.g. augmented reality, blockchain, etc., but everyone will need to have a working knowledge of artificial intelligence as a generalist, no matter your technical domain.
Workers should also look at industries falling behind as there’ll be plenty of opportunity for work here. They can work with organizations that are behind or at inflection points and help those corporations bring those industries up to speed.
Workers will need to ensure their lives are flexible and highly mobile in order to ensure they can quickly shift gears if they’re needed in different geographic markets.
In closing, this is an exciting time for corporations and workers in a world that has begun refortifying their positions for the future. The present and the future are full of possibilities for companies of all sizes, and people at all working-class levels of the economy. We’ve never seen evolution happening at this pace as a human race, and there will be more fortune happening at more accelerated paces than ever before.
I advise not to look at automation and artificial intelligence as the enemy, or as a catalyst to depressed economic and personal states, but rather as a vehicle for equal opportunity and a thriving economy and environment.