Amidst all of the animated discussion about what it will take to create millions of jobs today's climate, there is plenty of talk about what are the best means to do so, whether they be infrastructure spending, tax cuts, education, etc. One thing that I have noticed is missing from the discussion is the concept of paradigm shift. We are in the early stages of the shift from the information age to the digital age, and the unprecedented, exponential upswing in creative destruction is likely to eliminate more jobs than can be created in the years to come.
Come past the fold for more. I would suggest, however, that the Luddites stay out; this may be too much for them to take.
I have owned an iPhone for about two-and-a-half years now, and I can say without question that it is the greatest thing I have ever purchased for myself. It is very liberating to know that nowadays, I can carry around my entire life in one great little device that fits comfortably in my pocket, and apparently there's about 6.4 million other Americans that feel the same way.
That being said, let's take a closer look at what the iPhone can do, and what kind of an impact this can have on other industries.
- It's a phone, and it works well enough that it is now the only phone line I possess. Just like approximately twenty percent of Americans, I have permanently ditched my land line. That means less wiring for which raw materials need to be gathered, then sold and shipped to a location where the wiring is assembled, then sold and shipped to a wholesaler, then sold and shipped to a local phone company, then installed and maintained by that company. (And yes, I am aware that cell phones require elaborate antenna arrays that need to be installed and maintained, but it cannot be argued that the same amount of labor and materials is required as is needed for a land line.)
- Also, I have no need to purchase extra phones and handsets for my home, so that means one less person in need of telephones for which raw materials need to be gathered, then sold and shipped to a location where the phones are assembled, then sold and shipped to a wholesaler, then sold and shipped to a retailer, then sold and shipped to an end user.
- The iPhone has a built-in calender, so that means I'm one less person in need of a calendar for which raw materials need to be gathered, then sold and shipped to a location where calendars are assembled, then sold and shipped to a wholesaler, then sold and shipped to a retailer, then sold and shipped to an end user.
- It also has a Camera, and since I'm just a casual picture-taker, it's perfectly suitable for my needs. I'm one less person in need of a camera for which raw materials need to be gathered, then sold and shipped to a location where cameras are assembled, then sold and shipped to a wholesaler, then sold and shipped to a retailer, then sold and shipped to an end user. The pictures I take are now shared with my friends and family via email and Facebook, so there's no need for to buy film, get it processed, and have photos printed.
- It also has built-in GPS and mapping. I'm one less person in need of a GPS unit for which raw materials need to be gathered, then sold and shipped to a location where GPS units are assembled, then sold and shipped to a wholesaler, then sold and shipped to a retailer, then sold and shipped to an end user. The same can also be said for printed maps.
- It also has a built-in clock and alarm, so I'm one less person in need of an alarm clock.
- I also has an iPod, so I'm one less person who needs to go out and buy my music on a physical CD or record, and I don't need to go out and buy something to play them on.
- Thanks to the App Store, I've downloaded some nice little applications like Yelp, Frommers, and Zagat that allow me to look up restaurants, hotels, and bars in any city I may travel to, so I'm one less person in need of a guide book...or the assistance of a concierge.
- I have applications that allow me to read the Seattle Times, the New York Times, AP News, and Time, not to mention all the news updates I get from the journalists I follow on Twitter, for which there is also an application. I'm one less person in need of buying a newspaper or magazine that needs to be printed on paper that needs to be manufactured, after the raw materials are collected and shipped.
- Oh yeah, I've also downloaded a nice little e-reader application that allows me to download books onto my iPhone. So I'm one less person that needs to go out and buy a book at a book store.
- I have also picked up some nice little applications that allow me to do sudokus and crossword puzzles on my iPhone, so I need to buy neither a newspaper nor a puzzle book.
Through all this redundancy, I'm sure you can see my point. Thanks to the iPhone (and competitors like the Palm Pre and Blackberry Storm), myself and millions of other people no longer have a need to go and buy many commonplace items. They are all goods for which somebody had to be paid to gather the raw materials, somebody had to be paid to transport the raw materials to the manufacturer, somebody had to be paid to manufacture the item, somebody had to be paid to transport the assembled item from the manufacturer to a distributor, which then sold the item to a retailer, which paid somebody to ship that item to the retailer, which then sold it to an end user.
And it's far from over. Wireless data transmissions are also getting exponentially faster, which means pretty soon we'll be watching TV on our portable devices, and miniaturization will allow us to share those programs by way of embedded projectors. The days of the television set may be coming to an end.
We are in the early stages of the digital age. The goods and services that we purchase are going to increasingly come to us by way of a data transmission, thereby wiping out entire layers of production, distribution, and resale that were previously required to get products to the end user. Those eliminated layers are also going to take away millions, if not tens of millions of low to medium-income jobs.
Obviously, this does not portent the end of work, but the increasingly scarce jobs of the future will require intelligence and skills that a massive bulk of our population will simply lack. And think it's bad here? Consider the situation in a place like China, where the working class is just beginning to gain a foothold.
I think it will become necessary for nations to begin instituting guaranteed minimum incomeprograms, if only to insure that their unskilled and uneducated are provided at least a minimum degree of physical comfort, as well as provide a base of consumers for those selling the products of the future.
Welcome to the digital age. It's going to completely re-shape the way our civilization operates in a tremendously short period of time. Get ready.
UPDATE: Check it out.