Friday, August 28, 2015

Are Creative Jobs Going Away, or Not?

One year ago this month I published a post on the effects of the Internet on jobs, especially in artistic fields.  Using books from 2013 and 2014 I assessed the situation, concluding it didn’t look good.  I maintained that although online outlets had created more places for performers and writers to sell their work they rarely provided significant money, that online publicity was mostly illusory, and that pay for most creators was low or nonexistent with life-supporting earnings going to fewer and fewer people.

I hadn’t seen much in the past year to contradict any of that, so was surprised to see an article in last week’s New York Times Magazine, “The Creative Apocalypse That Wasn’t,” by Steven Johnson, making a case that such “careers are thriving.”  So what points did this piece make?

First, the article was actually consistent with some of my perceptions.  Johnson acknowledged that the music industry had gone through a “financial Armageddon” with its sales dropping 75%, from $60 billion to $15 billion, since 1999.  He wrote that more and more content providers, especially musicians, writers, and actors, were self-employed, and that “most full-time artists barely make enough money to pay the bills.”    

Second, it named developments new to me.  According to the Department of Labor’s Occupational Employment Statistics, the number of those working for others in the Arts, Design, Entertainment, Sports and Media Occupations category increased, from 1.5 million to 1.8 million, between 1999 and 2014.  Those performing or writing music as their main job rose a similar percentage, from 53,000 to 60,000.  While recording revenue has crashed, live music has done the opposite, with its worldwide sales tripling from $10 billion in 1999 to $30 billion 15 years later.  As a result of the latter, as hit singles, on which most artists earned little, once served as promotion for albums or CDs, recorded music is now serving as a way to get people interested in buying concert tickets.  

Third, Johnson pointed out that both availability and cost of first-rate professional music production have given it to artists and companies which could never before have afforded it.  Software has made sound quality costing millions of dollars a generation or two ago available for thousands or even hundreds.  Top quality books can be designed and printed by many independent publishers much smaller than Simon & Schuster or HarperCollins.  Correspondingly for TV and movies, truly professional-quality filming can be and has been done, astonishingly, with smartphones.       

Fourth, the explosion of advertising, which I also named a year ago, has brought demand for many more creative artists.  As well, the growth of cable radio and the profusion of cable TV channels, both of which unlike their predecessors are funded directly by consumers, provide more markets for creative work.  Other outlets once suspected to be in danger, specifically movies and independent bookstores, have held on, at the middle financial levels as well as at the top.

What, then, sheds doubt on paid artistic workers still being in healthy demand?  For one thing, the data Johnson used ends at 2014, and these positions may have been damaged since.  For another, the growth in self-employment in these fields hardly means those in them are paid well – indeed, most or at least many are not earning enough in them to survive.  The use of “average,” or mean, income conceals concentration at the top, so increases tell us little about how most are doing. 

One conclusion pointed to by both the New York Times article and what I and others wrote earlier in the decade is that people involved with writing, music, acting, and other creative fields need to realize the economics of their businesses have changed.  It is no longer sufficient for financial success, or even financial survival, to simply excel at performing; as Johnson put it, “the new environment may well select for artists who are particularly adept at inventing new career paths rather than single-mindedly focusing on their craft.”  The good news is that, given this technology-driven transition, these jobs will not go away. 

A long time ago I predicted that in-person activities, in this computer age, would come to be valued much higher than electronic ones, and that is exactly what is taking place now.  I cannot take much credit for being prophetic, as I expected it to happen ten years ago.  However, led by the creative fields, that shift in beliefs may finally be appearing.      

Friday, August 21, 2015

Amazon’s Office Work Environment Is a Product of the Jobs Crisis

After my complaint last week about the lack of recent attention to employment-related issues, one became the big story last weekend.  That, specifically what it is like to be an management employee, was the subject of the main piece on the front page, not the front business-section page, of Sunday’s New York Times.  

The article, or, as it might be called, a 100-megaton stink bomb, “Inside Amazon:  Wrestling Big Ideas in a Bruising Workplace” by Jodi Kantor and David Streitfeld, described what it is like to hold down a thinking job at this online retailer, a juggernaut which now has a quarter-trillion dollars in market capitalization.  It’s not easy, nor is it slow-paced, peaceful, harmonious, or, as the story implies and some cited former employees state, humane.  These positions require especially long hours and responses to emails at almost all other times, and are in a confrontational culture in which criticism can be sharp and frequent.  In what has become the most controversial part of the article, employees with health or other non-work problems, even severe issues such as cancer, have been put on performance improvement plans or have lost their jobs in Amazon’s annual removals of their lowest-ranking staff.  One interviewed manager said “nearly every person I worked with I saw cry at their desk.”  As a result, in sharp contrast with those getting the opportunity to work at relatively high pay for large, successful organizations, many new hires have lasted two years or less. 

In the five days since publication, the story has precipitated an outpouring of responses in major media outlets.  One of the first was a broad-based denial of Kantor and Streitfeld’s allegations from Amazon CEO Jeff Bezos, in which he said “this article doesn’t describe the Amazon I know or the caring Amazonians I work with every day,” along with his view that the piece described “shockingly callous management practices” and asserted “that our intentional approach is to create a soulless, dystopian workplace where no fun is had and no laughter heard.”  Within 48 hours, follow-on pieces were published in The Washington Post, Salon, and Fox Business, and, soon after that, related articles turned up in Financial Times and Harvard Business Review.  These pieces had views ranging from calling Bezos’s response “spin” which was “hard to swallow” (Salon) to questioning what Kantor and Streitfeld wrote, since Bezos had disagreed with it (Fox Business).  Columnist and former Treasury Secretary Robert Reich claimed that “America is a nation of Amazons,” and in the Harvard Business Review article, “The Research is Clear:  Long Hours Backfire for People and for Companies,” the original New York Times story was cited in its first paragraph. 

So what can I add to the conversation? 

First, Amazon’s working conditions, even if accurately described, are hardly unique.  Many physicians, lawyers trying to become firm partners, and front-line Wall Street traders, to name three, have similar hours, on-call requirements, and overall obligations of job intensity.  There are others without such high pay, for example those in the armed services.

Second, the self-critical mentality, which one Kantor and Streitfeld interviewee said was common at Amazon, may not be common in America but is characteristic of not only employees but students in Japan and Korea.  It takes a real toll on those learning or completing tasks, but is a tradeoff, since it can help people succeed. 

Third, not all jobs are suitable for all with the required skills and abilities.  Different people are willing to accept different levels of hardship at their jobs, including the areas the article describes of work atmosphere, time required, and after-hours demands in exchange for advantages such as high involvement, fast competency acquisition, and the chance for promotion and a lucrative career with a gigantic, successful, and growing company.      

Fourth, it may be bias from my own corporate experience (14 years in AT&T management), but I am suspicious if some aspects of the culture Kantor and Streitfeld claimed that management mandated match up with reality.  Are subordinates actually able to criticize those at higher levels without damage?  Are they truly empowered to spend company resources, including money, to help customers outside of established channels?  Can they “disagree and commit,” as put by one of Amazon’s “leadership principles” (reminiscent to me of AT&T’s “Shared Values”), without repercussions?  It is an old business expression that workers will hear from their management that independent thought is valued right up to the day they are fired for it – has Amazon truly beat back the political realities that made this expression trite? 
Fifth, workplaces such as the Times authors described, even if they as their critics say were exaggerated or marred by unrepresentative examples, are a natural consequence of the permanent jobs crisis.  Where workers are in excess, workplace standards will rise.  When there is a large pool of qualified applicants ready to replace those giving up their jobs, high turnover becomes less detrimental.  When a large share of people hired turn out to be unequal to the intensity, hours, and lack of outside obligations a position requires, they can be replaced by others who can try. 

Over the next few weeks and months, much more will be written and published about and on other work environments.  We will gain information about the accuracy of this New York Times story, and more on how companies allegedly or actually function in 2015.  What we should not be is surprised, or think that we are facing something truly new in the world of work.  We are not.  We may, though, be seeing more and more effects of the jobs crisis, which despite a lower unemployment rate is still with us.  That is what the Amazon article truly means.         

Friday, August 14, 2015

Jobs Schmobs! What’s Happening with the Candidates?

On one day last week we had two fine debates among 2016 Republican presidential hopefuls, with a sad but understandable omission.  American employment, just about out of the news otherwise as well, was essentially absent from the candidates’ Thursday discussions.  I’m not going to fight that, so here are my views on what’s happening with this bunch of people who now number enough to make up two football teams. 

Donald Trump, as my wife Mary put it, is still sucking all the air out of the room.  The press, as well as a remarkable number of scarily likely voters, is infatuated with him, to the point where we’re seeing major-press articles about what he does at home and about the statuses of his TV ventures.  He’s not lasting much longer at his lofty polling level, though, for two main reasons.  First, George Will beat him up but good yesterday in the Washington Post, calling him “incorrigibly vulgar,” “no conservative,”  and per his column’s title a “counterfeit Republican,” and pulled his punches even less when describing Trump’s recent and forecasted words.  Will, since he excels like no other public figure at being the only adult in the room, is taken seriously, especially by his and Trump’s party’s leadership.  Second, if gravity doesn’t bring Donald’s numbers down, he will find out just how difficult it is to be a front-runner.  His intimidation won’t carry him through even the inoffensive questions that will pour in about him and his policy positions, and his veneer of supporters won’t be able to protect him.  Temper tantrums from those aspiring to the highest office in the land won’t exactly be seen as seemly.  

When this drunken binge by a quarter of the population gives way to its inevitable hangover, the path will be reinstated for (speaking of adults in the room) Jeb Bush, whose audience will let him make the case for being the true presumptive nominee.  How well he does at that will determine how much scope there is for his true competition, which is still Scott Walker (despite his stupid approval of a quarter-billion dollar basketball arena) and the invisible but still present Marco Rubio. 

At the next tier, the Republicans certainly have bench strength.  Waiting in the wings, but probably not truly able to put themselves in the top group, are the sensible, thoughtful, and superintelligent Ben Carson and the clear-thinking Carly Fiorina.  Chris Christie also belongs here, though the forthcoming public disgust with bullies such as Trump may give him too much, in conjunction with Bridgegate, for him to overcome. 

On the other side, Hillary Clinton is in real trouble.  She made the wrong decision about her email mishandling – this far from the primaries, she should have put all of her cards on the table without being forced – and that isn’t her only problem.  Not since the death of disco have I seen such a juggernaut resented by so many in the shadows.  If my mother, a well-educated woman from the Northeast whose first presidential vote was for Adlai Stevenson and has never made one for the other party, is leery and distrusting of Clinton, then what kind of people are in Hillary’s core constituency?  Rush Limbaugh made an interesting point this week, suggesting that Bernie Sanders’ phenomenal appeal might be coming from the same thing that propelled Obama into office eight years before, namely dissatisfaction with the same presumptive nominee.   Her latest odds have lengthened to 13 to 10 against, which I suspect are much too short.  Joe Biden, almost certainly a target of passionate Democratic elders these past few weeks, will probably get in the race, as the longer he takes to decide, the more time he puts between himself and the death of his son.  The refreshingly forthright Sanders has not yet peaked, and in the absence of Biden will continue to be the chief recipient of disaffected former Clinton supporters. 

So what about jobs?  It will take a recession to put them on the presidential candidates’ front burner.  Some Democrats have mentioned the excellent idea of a national infrastructure project, but as I still see no takers for that among Republicans, it has become a partisan issue.  Otherwise, we’re going nowhere with this permanent crisis which has slightly abated but hardly disappeared.  At least, though, our candidates are giving us some kind of show to watch.  

Friday, August 7, 2015

AJSN Little Changed in July as U.S. is Now 18.9 Million Jobs Short

July was a consolidation month.  The Bureau of Labor Statistics employment data was barely different from June’s, as the labor force participation rate, the employment-to-population ratio, and the headline seasonally adjusted jobless rate were all unchanged.  We gained 215,000 net jobs last month, a tad lower than in June, but still more than the population increase could cover, and unadjusted unemployment rose, due to fewer people working as usual in July than in June, to 5.6%.  The number of long-term jobless, or those out for 27 weeks or more and still looking, bounced back partway from its 400,000 June drop to 2.2 million, and, in the best news of the month, those working part-time for economic reasons, or people wanting to extend their labor hours to full-time and not finding the opportunity, fell 200,000 to 6.3 million. 

What is most significant, except the last improvement, is that the 37-plus year lows in labor force participation and employment as a share of population, the best indicators of how common it is for Americans to have jobs, held last month’s losses.  Often when one of these numbers varies greatly from the month before it reverses somewhat in the next, as did long-term unemployment as above, but these two did not.  That means they have a real chance of setting new post-1977 lows again for August. 

The American Job Shortage Number, or AJSN, showing latent demand for additional jobs, increased 83,000 last month.  That was actually less than the growth in the share of those officially unemployed expected to take work if it were readily available.  As it usually does, those reporting they would accept jobs if they were not in school or training fell from June to July, and people wanting work but not having looked for it for a year or more did the same.  In all, the AJSN came in as follows:

Compared with a year before, the AJSN has shown real improvement.  In July 2014, there were 1.5 million more officially jobless, meaning that if 90% of them would take work if it were easy to find, that set of people would absorb 1.35 million more positions than now.  The other groups offset a tiny bit of that.  Fifty-eight percent of these jobs would now be filled by people not technically unemployed, higher than in previous months but still not far from historic lows. 

So where are we now?  This month splendidly fits with the movements of 2015 – new jobs moderately but not massively outstripping population gains, fewer Americans working part-time for economic reasons and staying officially unemployed for over six months, but jobs becoming, proportionally, less and less common.  Those are the modern trends.  We are also piling up years without a true recession – a fine thing, but not one assured of continuing indefinitely.  The jobs crisis, if softened somewhat, continues, even if the turtle is still moving forward.