The Coming Jobs War

Alot of Californians are guilty of complacency when we think about the economy and American jobs. I think many of us consider the decline of American manufacturing and working-class jobs as something that’s happening elsewhere – in the Rust Belt, or the Midwest or rural Pennsylvania. The vitriol and overwhelming Democratic majority in California allowed us to dismiss many of the issues that then-candidate Donald Trump raised about the future of the working class. Our complacency is dangerous to our economy and our community. The San Fernando Valley has a strong economic history in manufacturing – for example, we host aerospace companies which have led the world in technological innovation for decades. But we can’t rest on our laurels and assume that our history of success will translate into continued strength. In fact, the San Fernando Valley should be even more concerned than many parts of California about jobs for future generations. Historically, the Valley’s strengths were in manufacturing. Los Angeles County has been steadily losing jobs in manufacturing; that is a well-known fact. The types of jobs which are increasing are service jobs in retail, hospitality and home health care. There are many reasons to be concerned about these trends – manufacturing jobs are higher paying, while many service jobs are poorly paid. Manufacturers need to train their employees and many will retain employees for years or even decades, while employers in the service sector can hire and lay off much more easily to accommodate seasonal changes. There’s another problem too – automation. Ten years ago, I don’t think anyone anticipated automatic technology to accelerate as quickly as it has. If you don’t believe me, consider how astonished we all were by the introduction of the iPhone 10 years ago last January. Now, Starbucks lets you order your coffee via app, ready to pick up at the location of your choice. You can order Panera Bread from your table via your smartphone. McDonald’s is rolling out touchscreen ordering with the same technology. As the San Fernando Valley loses good-paying manufacturing jobs and replaces them with low-paying service jobs, we should be alarmed. A 2013 University of Oxford study ranked jobs that are most likely to be “computerized” or automated, and the study found that many service jobs will almost certainly be automated. Governing Magazine used that research to estimate that 58 percent of the jobs in the greater Los Angeles area are susceptible to automation. Automation is getting cheaper and encroaching upon jobs we thought were safe from off-shoring – cashiers, cooks, drivers and even creative jobs are being threatened by automation and the increased power of smartphones and computers. Right now, California is accelerating this trend by making human employees more expensive. In places where human labor is more expensive, such as England, rows of self-checkout machines in grocery stores have become normal. There are regular cashiers – but maybe only two or three, tucked away in a corner. These are entry-level jobs, but they’re jobs Los Angeles is increasingly relying on. The nature and skill sets of both manufacturing jobs and service jobs is changing. Manufacturers need employees who can run highly technical machinery. Service jobs need creative employees who aren’t replaceable by off-shore or automated workers. The Los Angeles Community College District has recognized this new reality, and has included in its draft Strategic Plan an objective to review curriculum to ensure it is relevant to the students’ future careers. The district is working to increase job placement rates and work with industry partners. This will be a crisis in the very near future. Of course, there will always be highly creative and skilled professional jobs, but those aren’t the ones the vast majority of people hold. Most people rely on old-fashioned, working class jobs which are going to rapidly disappear. We need to acknowledge this reality, and figure out how we are going to survive the transition without mass unemployment and economic catastrophe. Stuart Waldman is president of the Valley Industry and Commerce Association, a business advocacy organization based in Van Nuys that represents employers in the San Fernando Valley at the local, state and federal levels of government.