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March1993 Vol.IV,No.3 INPUT ACCOR Routeto: Research Bulletin APublicationfromINPUT Impact of Technology on Employment Technology,specificallyinformation organizationshavebeen"protected"innational technology(IT),affectsemploymentinthree marketsandhavethusgrown"fat"in ways: employmentterms). Mr.Bamevikforecasts 231... LLNoeacvtaeutlrieoofonreotmfyppwleooryokmfewnotr,kopreurnfeomrmpeldoyment teisnhemarp1tvl0i"octyeyheseeadrwpisril'onltpmfoiaarmlntelui—ffornaaoconmtfduaErtbuioornu1ogtp5ae3%n'5dsa%blduatesbociodarnaedfyseostrlocaet2er5.%" LevelofEmployment Healsopredictssharpdeclinesinpublicsector payrolls. Inthemid-1980s,INPUTpredictedthat AsINPUThasalreadydone,helikensthis iialnnttferorortdmhuaecteifdounttuhtreeeccehomnnpoclleoopgytymoewfnoHtuUlpdMicAdtruTraIem.aCtSWiceally redaerrvalomilaeutrtitichoainlsltcyoeintnthucarrtyei,answeahdgerpirrceoulditunuccrtraielvaiestmeydpwlahouiytlomemeanttion (Human/AutomationInterfaces)andadvised decimatingemployment. Herightlyasksthe clientstopayattentiontotrendsinthisarea. question,"Wherewillallthesepeoplego?" Recently,anumberofeventsandrecognitionof Mr.Bamevikseesthepotentialfortoday's underlyingtrendsinthemediahavebrought unemploymentratesofaround10%becoming tBhaimsesvuibkje,ctprteositdheenstuorffaAcBeBa,gaitnh.ewMorr.ldP'esrclayrgest 2dy0n%amtiote2.5"%. Ashepointsout,thisis"social powerengineeringgroup,wasinterviewed recentlyintheFinancialTimes. Infouryears, NatureofEmployment sincetheformationofABBbythemergerof AseawithBrownBoveri,ABBhasincreased Thispotentialforunemploymentisexacerbated rbeyv5e0n,u0e0s0b—ya6n0d%itwphlialnessthoricnoknitnignuietstwhiosrtkrefnodr.ce bstymactcuorrereasmpoonndgitnhgepeomtepnltoiyaeldf.orWaetwaor-etiuesring Mr.Bamevikfeelsthatothercompaniesand systemstorestructureorganizations,to"flatten industriesmustslimdowninordertobe themout,"to"removethemiddle,"to"de- competitive. skill"certainjobsorreplacethem,to"go direct"tocustomersorsuppliersratherthan InMr.Bamevik'sview,highratesof throughintermediaries. Already,companies mupparnuroectdmiuhcpcutallisoavrytilhmtyeyerncaeotnlnedasvrcaeeonqtmnupoetetontctiEehtueirovrofeepnsieuenlscwtsrh.eoeafsr(reeTsehcmiiesansnsisiyonso lsstitaakffeff:Hwefhwullole-rttetic-mePeiavscetkanaffrodabnhednaevffeuiltltsywooermcpsaeltceougyroiertdyi.e"sfIloCefxL" ©1993byINPUT.Reproductionprohibited. RESEARCHBULLETIN — .inEuropeissendingincreasingnumbersof aroundtheworld andthepotentialforlossor stafftoworkfromtheirhomes. ITenablesthis damagewashighbecauseofthehandling tohappen. involved. RecentdatafromasurveycarriedoutbyAMA Secondly,manufacturerscodifiedtheir intheU.S.showthatoneofthemajorreasons processessothattheycouldbemoved. They forcontinued"downsizing"inemploymentin builtthetrainingprogramsthatallowedthemto theU.S.isincreasingautomation. Andplansto establish"greenfield"manufacturingfacilities downsizeemploymentaremoreprevalentnow veryquickly. Certainlyverylarge,capital- inU.S.organizationsthanatanytimeinrecent intensiveplants,suchasrefineries,alimiinum years. plants,androlhngmills,werelesssusceptible Thekeyareaofimpactinthenext10yearswill tosuchmoves,butnotethesuccessofdiemini- bethe"whitecollar"orofficeworkforce. This mills. iswhereautomationwillhaveanever Now,throughelectronicnetworks,wehavethe increasingaffectthroughnewsystemsand meanstomove"whitecollar"work,i.e., structures. Businessre-engineeringorprocess clericalorknowledgework,aroundtheworld changeislargelyfocusedinmakingdramatic inthesamemanner. Itisalreadyhappening improvementsinproductivityinthehandlingof withintheU.S.asorganizationsmoveoffices information. fromhigh-costareassuchasNewYorkand SiliconValley. LocationofEmployment Butitisalsobeginningtohappenonamore Thisdoesnotbodewellforofficespace globalscale. Forexample,amajorEuropean requirements. InINPUT'Sopinion,theoffice airlinehasmoveditsaccountingoperationsto spaceincitieslikeNewYorkandLondonmay India,andaverylargeU.S.-basedmanufacturer neverbefilledbecausetechnologywill(a) hasmoveditscomputeroperationstoIndia. (If reducetheoverallrequirementsforlargeoffices anyoneneedshelpindoingthis,INPUTandits and(b)allowsmallerofficestobelocatedin Indianparmerscanassistintheprocess!) moflifourfcsciatcthpeilsolanewcssee.s!reWexeploescnhastoieuvdledianrnetdhmemesmuebcelharr,mgoearfcteietriaetastllri,ancwtthihveye cIOanomfuoCncautolneuirtrfvsooaerf,inlirtiaehn,gegurfleotarrtiesienoxdon.an,meTplhelvgaeeirt,sylioasivtmiteophrnoe,r1it,ana0ncn0drt0elanisteiiwnggatliaown.s INPUTbelievesthatworkislikewater,itflows wentintoeffectonJanuary1,1993. Keeping downhilltothelowestcostlocation upwiththeseisboundtoincreaseemployment. commensuratewithquality,wherecostincludes Somaybewehavefoundsomevalueinhaving costofdistributionaswellasmanufacturing. lawyersafterall! Butontheotherhand, mFsIinahrinstputhlpfeyea,1dcc9tao7urn0rtosiauninagndnetdrthihr1zeo9auwt8igo0ohsrnlswdeeenvvaeerrbrealyvleodrplarugpotiocidoeoldsnyss.ieztseIo.dfbe rcpaoleetnlretohrrcanaapactsttiiiotvnnhegiso,sftpwolairalftblu-olstrlii-ammtenip,mdleyaiwnnadoccrcr"eekoaluesftreoasdrtcoueeussrt.echeeodf" necessary,goodscouldbeproducedin Wecontinuetofeelthattheinformation SingaporeonedayandbeinNewYorkintwo technologyindustryneedstopaymore daysthroughtheuseofaircargocontainers. If attentiontotheseHUMATICSissuesthanit youcouldwaitalittlelonger,theycouldbe does. Afterall,workersarevoters,voterselect thereinafewweeksthroughroad,ship,and/or representatives,representativesmakelaws! rail. Previouslyittookmonthstomovegoods ThisResearchBulletinispublishedbyINPUT. Ifyouhavequestionsorcommentsontiiisbulletin,pleasecallyourlocalINPUTorganizationor INPUT,1280VillaStreet,MountainView,CA94041-1194 (415)961-3300 ©1993byINPUT.ReprcxJuctionprohibited. INPUT'