Those were among the takeaways from a wide-ranging discussion about the future of work with two of Gov. Gavin Newsom’s key economic advisers I moderated at the California News Publishers Association in Sacramento last week.
The issue of calibrating employment and the workforce to the ever-evolving realities has long been a fascination for the governor’s wonkish side. He spoke extensively about it when he met with The Chronicle’s editorial board before the 2018 election. Now, as governor, he wants to do something about it.
But can he? Are the forces of automation and globalization too unrelenting and irresistible to offer any hope to the 35% of Californians who are making less than $15 an hour in a high-cost state.
In recent years, various think tanks have put out reams of studies on the future of work, but few of their ideas have yet to be reflected in public-policy action. After all, the course to address “the future of work” is a bit more abstract than the typical challenges taken on by elected officials: build roads, cut or raise taxes, reduce prescription drug prices, promote housing construction.
“This governor’s not interested in another study,” said Lenny Mendonca, the governor’s chief economic and business adviser. “The challenge he gave the group when it first got together was: Be bold. Give us your best ideas and then leave how we get that done to us.”
Mendonca and Aneesh Raman, senior adviser for economic strategy and external affairs, each talked about how California’s robust economy — which attracts 50% of the nation’s capital — is not working for many who are not in the tech sector. Another challenge will be to structure an economy that is “sustainable through climate change,” Mendonca said.
They both emphasized that promotion of lifelong learning and better distribution of opportunity must not come at the expense of the innovation that has been such a generator of prosperity for the state.
So what would be the role of public policy? That may become clearer when the commission issues its initial recommendations this spring.
“It starts with us as individuals,” Raman said. “We have to be constantly learning and adjusting.”
Raman was perhaps exaggerating only slightly when he said “the generation coming of age” is going to have 19 jobs over the course of a career. A Deloitte Insights study in November 2017 predicted the “half-life of skill sets will decrease to five years in the future of work” — meaning an individual would need to update and refresh his or her skills six times over the course of a 30-year career.
The bottom line is that no one can assert with certainty how many transitions would be required or even what those new jobs might be.
Change, by the numbers
40%
of Americans are in occupational categories that could shrink by 2030.
25
urban areas accounted for two-thirds of U.S. job growth in 2007 and could generate 60% of U.S. job growth through 2030.
-3%
potential job growth through 2030 in distressed American counties.
14.7
million young workers are in highly automatable jobs.
58%
share of net job growth that women could capture.
4X
higher risk of displacement for workers with high school diplomas or less.
Source: McKinsey Global Institute study on the “Future of work in America,” July 2019
Among Deloitte’s policy recommendations:
• Make it easier for entrepreneurs to launch — and exit — endeavors through rules on business formation and bankruptcy. It said policymakers should encourage the emergence of new forms of work as a way to raise standards of living — while addressing the “stresses of the transition.”
• Rethink education to “establish a framework to help everyone develop their talent more rapidly,” with a focus on uplifting marginalized populations.
• Update the definition of employment to “account for freelance and gig economy work.”
Newsom signed a bill (AB5) last year to address the latter issue by severely cutting back the ability of businesses to use contract work. Many industries have complained that the union-pushed bill is far too restrictive and could push some businesses to leave the state. Some of the workers supposedly helped by AB5 like the flexibility of being an independent contractor and are pressing the Legislature to revise it. In the case of the newspaper industry, its application to carriers — which takes effect in a year — could curtail or even end home delivery in many communities.
Thus the challenge of government trying to guide the future of work. Globalization and the advancement of artificial intelligence further complicate the ability to anticipate the necessary policy steps.
“We are not in a robot apocalypse where there will be no jobs in the future,” Mendonca said.
But that economy is going to reward the players who are poised to adapt. It’s heartening to know that California’s governor is on the case.
John Diaz is The San Francisco Chronicle’s editorial page editor. Email: jdiaz@sfchronicle.com Twitter: @JohnDiazChron