High Tech Job Killing

Where will our next generation of jobs come from?

The banking sector clearly is not a major growth industry—company staffing counts go sideways, average Wall Street bonuses slide, and retail operations shrink thanks to cash machines and smart phones. And who needs trading floors and as many day traders when transactions are programmed by computer algorithms. Consolidation has been occurring for years as most major cities have lost their money center banks to the global finance centers—New York, London, Tokyo, Hong Kong, and a few others. Last week's Wall Street Journal article about Bank of America highlighted how its Charlotte headquarters is just a fiction—most senior executives operate out of the New York area.

When oil prices skidded last year energy towns cooled quickly after a hot growth spurt—Houston doesn't look so appealing anymore and North Dakota (as if it were ever a major place to invest) is back in the doldrums… Oh Canada—it's once highly touted economy has tracked backwards on oil price shocks. With U.S. unemployment at a lowly 5%, everybody is waiting for housing construction to really kick into gear, but that's been like waiting for interest rates to increase. The "full employment" numbers continue to belie a compromised workforce, which suffers from ongoing wage stagnation and many college grads saddled with high student debt. As a result unsurprisingly, first time homebuyers continue to lag and home construction is well below past peaks… And if the Fed finally ticks up interest rates at year end, mortgage rates will follow—not exactly a plus for housing.

So everybody is on the tech bandwagon, a notoriously volatile category, which is actually the biggest factor battering our workforce numbers and compensation levels. You can joke about how many more apps we need to find restaurants or the right pair of silver candlesticks. But how many more do we really need? Google and Facebook drive profits through advertising, but if people lose jobs or find their budgets stretched because their compensation flags they will have a tougher time eating out and just plain consuming, and that will eventually hit advertising rates. Meanwhile, the traditional advertising outlets like newspapers and magazines disappear with all the jobs they once mustered. TV network programming and cable TV platforms are about to fall apart as internet options disaggregate channel packages. Movie theaters struggle to keep up with home entertainment options. Lots of jobs continue to disappear. At some point we will figure out we don't need all these tablets, smart phones, laptops, desktops, and flat screen TVs, and can consolidate functions without spending so much on so many expensive devices. Am I wrong, but did we reach the limit when Apple introduced smart watches?

And so much of the tech sector is focused on facilitating productivity, which continues to lay waste to other traditional jobs and helps dampen average wage gains. Driverless vehicles promise to eliminate many taxi drivers and truckers; the proliferation of robots eats further into the manufacturing jobs that would build the driverless cars; drones and robots even reduce the need for as much flesh and blood in the military, a traditional employment option for the non-college bound. Internet shopping relentlessly cuts into bricks and mortar retail and all those sales jobs. Mom and pop store owners don't have a chance when shoppers can buy the same item for less on Amazon. It's the Walmart effect squared. And don't you know Walmart and Target are relying more on internet sales, which will be packed by robots, delivered by unmanned drones and driverless trucks, and paid for through wireless transfers. Store clerks may get raises, but there will be fewer of them, many fewer.

Will apps creators, social media bloggers, and robot repairmen replace all the bank tellers, newspaper reporters, and cabbies? Don't think so...

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A marketing communication strategist who turned to real estate analysis, Jonathan D. Miller is a foremost interpreter of 21st citistate futures – cities and suburbs alike – seen through the lens of lifestyles and market realities. For more than 20 years (1992-2013), Miller authored Emerging Trends in Real Estate, the leading commercial real estate industry outlook report, published annually by PricewaterhouseCoopers and the Urban Land Institute (ULI). He has lectures frequently on trends in real estate, including the future of America's major 24-hour urban centers and sprawling suburbs. He also has been author of ULI’s annual forecasts on infrastructure and its What’s Next? series of forecasts. On a weekly basis, he writes the Trendczar blog for GlobeStreet.com, the real estate news website. Outside his published forecasting work, Miller is a prominent communications/institutional investor-marketing strategist and partner in Miller Ryan LLC, helping corporate clients develop and execute branding and communications programs. He led the re-branding of GMAC Commercial Mortgage to Capmark Financial Group Inc. and he was part of the management team that helped build Equitable Real Estate Investment Management, Inc. (subsequently Lend Lease Real Estate Investments, Inc.) into the leading real estate advisor to pension funds and other real institutional investors. He joined the Equitable Life Assurance Society of the U.S. in 1981, moving to Equitable Real Estate in 1984 as head of Corporate/Marketing Communications. In the 1980's he managed relations for several of the country's most prominent real estate developments including New York's Trump Tower and the Equitable Center. Earlier in his career, Miller was a reporter for Gannett Newspapers. He is a member of the Citistates Group and a board member of NYC Outward Bound Schools and the Center for Employment Opportunities.