Earlier this month, CEO Oliver Blume told employees that the company needed to end a three-decade-old job protection pledge that would have banned layoffs until 2029. Troubled German car giant Volkswagen has denied a report that it is planning to lay off up to 30,000 employees. (euronews)
Innovation ideologists like Peter Diamandis have a strong opinion about the dynamics of technology replacing jobs and new jobs being created: historically, technology has made space for more jobs created than replaced. Being positive about the experience of the past, they envision the same trajectory for the future: yes, automation, artificial intelligence, autonomous production, and more will replace jobs. But a) most of them are jobs humans should not do (dangerous, repetitive, trivial, or requiring a high level of accuracy), and b) just like in the past, more new jobs will be created than existing jobs lost.
I am challenging this opinion and will explain why we should start laying off jobs today. Bear with me.
Exponential change has dynamics that make it hard for most people to comprehend. The most common visualization of how unintuitive exponential functions are is the 30 steps experiment: take 30 linear steps (each step about 1 meter) and you will walk 30 meters. Take 30 exponential steps (each step twice as far as the previous: 1, 2, 4, 8, 16, 32... meters) and you will walk 26 times around the equator.1) This does not seem logical and for some not even realistic. When asked, people often guess something like from San Francisco to New York, which already sounds like a really far walk.
The point I am trying to make: don't try to anticipate the full bandwidth of exponential change. Ray Kurzweil, the co-founder at Singularity University, once said: "Even I have to write it down every time."
It is true that technological advancements have opened up the job market to unforeseen capacity. Most of today's jobs did not exist 20 years ago. When I graduated from school, the job options matched a wonderfully comprehensible set of boxes: Medicine, Law, Economics, or Science. Everything around art was already perceived as a job with a very skeptical eye: "Most of the artists are broke," our parents warned potential explorers of fine arts of all sorts. Today, you can design everything—even processes, services, and thoughts; you can combine human psychology with data science and might end up a $900K hire at companies like Netflix. You can develop apps, sensors, work in mechatronics. As a matter of fact, traditional jobs like medical doctors and lawyers should look with a very cautious eye at today's technological progress. Long story short: it is true—we have created a lot more jobs than those we replaced with technology.
There are two other data points that factor into the equation, both overlooked:One, we doubled (!) the world population twice (!) in the last 100 years. Which means half of the jobs replaced by technology need four times the amount of jobs created.Shall we pause for a second?
Two: when half of the jobs got replaced by technology in 2000, we are talking about 1.3 billion jobs. When half of the jobs get replaced by technology in 2024, we are talking about 1.7 billion jobs.(source: Ilostat Database)
In other words: with a relative job loss in 2024, 400 million more new jobs would have to be established than 20 years ago.
I am optimistic about the development of the job market as well. I am optimistic that we will create many more jobs than we will lay off through economic and technological development. BUT: time will not be on our side. We will not be able to invent the new jobs at the same pace as we lay off the existing jobs. We will have to deal with a period where old jobs are lost and new jobs are not yet invented.
This is going to be a challenge.
For various understandable (political- and social) reasons, companies like Volkswagen want to avoid these massive layoffs. The problem with this decision is the time we have from losing our existing job to finding our next professional calling will be significantly shorter in a dramatically more competitive environment.
This rapid alternation between problems solved and bigger problems created will put us in front of the biggest social challenge we have ever seen, particularly in Europe and North America.
The unpopular answer is: the sooner we start the process, the more time every individual will have to reinvent themselves. This is scary, wild, and brutal—but nothing compared to what is going to happen if we delay the inevitable.
The future is only scary if we run away from it. As a matter of fact, the future does not really care if we face it or not: certain developments will cause disruptive change, whether we like it or not.
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