Economists in the twentieth century, from communist through to fascist, and everything in between, almost exclusively relied on labour cost (per hour) as the main determinant of the price of goods and services. That link is now in the process of being broken by technology.
The link to labour hours is still there, and to a substantial degree for most businesses, so it needs to be managed very carefully – but we also need to keep an eye on the horizon so that we can, hopefully, catch some of this new wave.
The knowledge economy, democratisation of information, automation, technological leverage, peer networks, 3D printing, AI, bots, renewable energy, are all weakening the link to labour hours and this is shaping up as one of the huge challenges facing the modern world right now. And it’s a big one.
Will it result in new types of automated monopolies that bring widespread unemployment, increased tax evasion, poverty and suffering? Or will it help reduce the problems we have with the current bunch of old-economy rent-seekers.
How do we run successful, inspiring, and ethical, creative services businesses amidst the upheaval?
Globally, increasing proportions of the smartest graduates reaching working age are turning their backs on traditional employment and embracing the start-up world. Many are doing this because they feel the cards are so unfairly stacked against them. They have been called “Graduates without a future” by British journalistPaul Mason, and I get that, but also whenever I talk to them I see great hope. Perhaps I just get to meet the lucky ones but I think world over they certainly have a better understanding of how the world works than older people, like me, did at their age. I think that’s inspirational.
These days, after seeing hundreds of workplaces over the years; varying from the great, the humdrum, to the truly horrifying, how we approach these challenges in our own businesses can increasingly have an influence on the world.
It’s almost fifty years since people started saying “think globally, act locally” but perhaps there has never been a better time to do that. The difference is though, now, local is the whole world for most of us.