In The Reckoning, I suggested that the decades-long squeeze on labor still has room to run, particularly in light of two technological trends: the growing adoption of robotics and the emergence of 3D printing.
Two interviews released this week lend credence to the continuing squeeze.
Inequality—I think it’s mostly a function of technology in a global workplace. In other words, technology is having an effect on that productivity that means that you don’t need people the same way that you did before. And it’s a big—it’ll be a big issue. And it’ll be a big—a much bigger issue going forward.
Second, Katy George of McKinsey & Company discussed the firm’s most recent concept on manufacturing: Next-shoring. Essentially, the global labor-cost arbitrage game is over (for now, at least), energy dynamics are changing, and the aforementioned technological advancements (plus digitization) mean capital-intensive manufacturing operations should be located near centers of demand and innovation. This eight-minute interview provides a more detailed overview:
So in short, the future’s probably going to be amazing. But as a society, we’re likely going to require radical transformations in our approach to education, corporate financing and our views on “full employment”—among other things. The journey between here and there may get turbulent; but for now, it’s on to the evening’s entertainment.
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1 I find Dalio’s principle of “radical transparency” attractive. This pitch on Bridgewater’s website is captivating.