Jobs Fix

When the slow US economy is discussed, it's often noted that there is still weakness in the labor market, for structural reasons. Generally, this means that due to the combination of drag from the great recession and globalization, i.e. jobs moving overseas for lower prices, there are fewer people participating in the US labor force. However, because of the way we measure things, as well as the larger amount of overall wealth in the US, there are no long lines at the soup kitchen as there were in the 1930s. Most people with employment struggles find a way to downsize their lives, earn some money one way or another, and adjust their lifestyles accordingly. That is not a bad thing, as some may find a simpler life suits them better.

But if you look at the last great economic expansion, from 1940-2001, more or less, there were employers who innovated about what they needed done, how to get it done, and who to hire to do it. Ford and the assembly line comes to mind. Maybe that was earlier, and I'm not saying that repetitive and tedious work is a great way to spend a person's workday, but people will decide for themselves, is this a job I'm willing to do for this price? What appears to be lacking in today's economy are employers who define new roles, and then hire able citizens to do that work. Data and customer behavior prediction look to be the very large employment opportunity from my vantage point.

Having worked as a software developer and quantitative analyst in the financial and trading sector since 1996, I've heard colleagues say that creating a good model and using it to predict useful things, which all companies could do, is about 80% collection of data and 20% of actual modeling. So why are we paying expert modelers to spend 80% of their time doing tedious and repetitive work? Surely companies can define new roles and hire new workers to do that part of the process. Just because the work "looks the same," i.e. you're sitting at a computer and typing on a keyboard, doesn't mean it's not a completely different type of work. The first auto engineers may have done all the work themselves when building the first car, but eventually support roles developed, and many, many more people were employed in those roles.

The same should happen for data mining / predictive analytics / big data, whatever you want to call it. If you're good at modeling, you'd be happy to do it all day long, working with others who can collect, organize, and maintain the data needed. I've seen it in the financial world, it's only a matter of time before the rest of the economic sectors, and companies that make them up, apply that to their own benefit. Let's get to it!

[And Charlie Munger agrees, p. 406 of Poor Charlie's Almanack, re: task delegation: "Even if a manager can perform the full range of tasks better himself, it is still mutually advantageous to divide them up."]