Adapt to What? – An Open Letter

Dear Millennials:

Once upon a time (in the 1970s), the actor you might know as Steve Martin was a rising star in stand-up comedy.  One of his jokes began with the premise that he would tell you how to earn a million dollars and never pay taxes.  The real laugh in the bit came when Martin would say, “Ok, first get a million dollars….”  See? That’s funny.  And the reason I mention the joke here is that it seems to me quite a few peppy pundits out there are telling you a version of this joke, only they’re not kidding. They’re not saying “First, get a million dollars.”  Instead, they’re saying things like “Adapt to the market you’re inheriting,” which, in many cases, is an unfortunate euphemism for “Just become a star.”  Because if you don’t become a star in the market presently being transformed as you’re trying to enter it, you might be basically screwed.

No question it was very cool of Taylor Swift, who is obviously a superstar, to stand up to Apple on behalf of professional musicians, who will never be superstars. But as this indie artist points out, all the non-superstars (who, by the way, make most of the music you probably love) are still hosed because the streaming model is not yet sustainable, no matter whose service leads the market. And these music professionals are likely to remain hosed because we may have devalued work (not just music, but work) past the tipping point of sustainability. And you should be angry about this, even if you helped feed the problem.  This article by Rebecca Smith for Fortune explains why, for instance, the Uber business model can be a universal job killer.

“Today, as the super-rich have amassed ever greater shares of wealth, the connection between working for a living and being able to earn a decent living from work has disintegrated. Perhaps nowhere is this disparity more evident than in the growing “on-demand” economy. Companies like Uber, Lyft, Crowdflower, Homejoy, and others in transportation, delivery, hospitality, home improvement, domestic service, technology and elsewhere have adopted business models that pass the costs of doing business onto workers themselves and move the wealth their service provides upwards. The on-demand economy has already created its share of billionaires – Uber’s co-founders are worth around $5 billion each, while those who drive for Uber receive meager pay.”

So, what the “adapt” mandate implies here — again echoing Steve Martin — is “First, go invent Uber.” But there’s like 80 million of you millennials in America, and the digital-age market only has room for one or two (usually one) major player in any category at a time.  So, in terms of realistic ratios, even if a million of you might invent killer apps or become YouTube stars, neither of those enterprises will create and sustain real jobs for the  the other 79 million.  As Smith points out, and as supported in this essay by Umair Haque entitled The Servitude Bubble, the devaluation of labor and general shift toward a market of ad hoc pieceworkers, livery drivers, servants, and craftspeople all working too cheaply for a wealthy minority is not limited to any particular business sector.  As many of of my colleagues have been saying for some time, what the tech industry and free-culture consumers did to music is now manifest in other areas of the market. Smith projects your future as follows:

“Our new grad might sit down to her computer every day, wondering whether she will get enough work to make it through to tomorrow, doing mind-numbing tasks like matching names to photographs and matching the word “blue” with the color “blue,” and she’ll compete with 500,000 workers across the world who are hungry for the same micro-jobs. One researcher has found that 70% of the tasks on [Amazon’s] Mechanical Turk are worth 5 cents or less, yielding an hourly wage of less than $5.”

Maybe that prediction is more dire than necessary. I hope so.  But read between the lines in any number of trends and we see a hyper-efficient, data-centric view of the world, of culture, and of market value that appears to be fueling the growth of monopsonies empowered to dictate terms to every kind of worker from book authors to carpenters to truck drivers. And it occurs to me that for all its fluffy futility, OWS demonstrated that many of you were on the right track. You should be pissed off at the 1% and angry as hell at Wall Street.  But I’m sorry to say that the business models of the digital age are not the antidote to Wall Street; they are its worst intentions on speed.  It is insane that a company like Uber, which has yet to prove itself, which creates no real jobs, which functions like a pyramid scheme, and which could evaporate overnight is valued in the tens of billions by “the market.”  This should piss you off, not only on its own terms, but because major business owners in many sectors seem to be learning from these tech-based models how to take advantage of your talent, your time, and your costly educations for pennies on the dollar. They know the more that labor is devalued across multiple sectors and the more desperate your circumstances become, the more bargaining power they have. And it doesn’t even have to be malicious. If these economic forces drive the value of work down and the global market is flooded with millions of talented, educated people, it becomes untenable for even the most generous, well-intentioned employer to offer more than a meager going rate for your services.

But here’s a solution, at least part of a solution, as I see it:  you are the market. Right now, you’re the consumer everybody wants. Of course, because the big players figured out how to monetize your attention without asking you for any money, you won’t notice right away that you’re actually paying for the present with your own future value. (And how ironic is it that your time has been turned into a commodity pegged to advertising when studies show you will avoid advertising at all costs?)  It may not occur to you that it is contradictory to hate on Wall Street and then order up an Uber car or pirate a movie or a book, and the VCs whose names you don’t know are counting on you not to notice. You get the concept that “buying local” is an economic driver for your community, but the studies and the pundits all say you won’t even buy a digital download from your favorite band because when you were kids, some adult told you that you shouldn’t pay for music.  But that adult is a billionaire now, and he hasn’t even bothered to build a company where you might get a decent job.

Here’s an experiment I am sure won’t catch on, but what the hell:  stop pirating media; if you can, buy one extra album or video or book or something each month in a local, retail environment; get a subscription to a legal streaming service; and most of all, refuse to patronize or work for a businesses that wants people to work for free or is looking to turn valued labor into freelance, micro-tasks. Then, watch what happens. You’re the market. Let the damn billionaires adapt.

© 2015, David Newhoff. All rights reserved.

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  • David – What about the recent CA labor decision v. Uber? Do you think that we could be looking at unionization, for lack of a more digital-era term, as a solution to this problem (at least in the case of on-demand, labor-driven businesses)? IOW, when the consciousness of the Uber drivers hits a tipping point, Uber will no longer be able to blithely skim their scalable billions off the backs of these drivers,and will have to pay them fair wages, grant benefits etc? Isn’t it possible that the pendulum will swing back, just as it did in the 1900s?

    • Thanks, John. Of course it could go that way. And I hope people demand it. I don’t see any reason why Uber can’t evolve into a legit company. One problem, of course is that there are no actual billions of dollars, just billions in valuation as determined by whatever dark magic applies in the capital markets.

      • Uber can’t evolve into a legit company because Uber’s business model doesn’t work if it treats employees like employees or becomes subject to serious regulation. It then becomes just another taxi company. We already had taxi companies, and they weren’t diverting most of their capital to make their owners paper billionaires.

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  • Techies love to disrupt so much, perhaps it’s time for an enterprising young whiz to develop applications that replace upper management. Start with CFO maybe. Why not? Work with goal of developing effective applications to replace virtually all senior management. Demonstrate its viability. Let them feel disruption.

    And BTW, given that investment in most private companies requires one to demonstrate liquid net worth of over $1M, allow people to invest in “eManagement, Inc.” only if they can demonstrate net worth of LESS than $1M.

    Mid level management jobs are already being replaced by software. Let’s take it upstairs.

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  • What you’ve written here is great, and it addresses things that need to be discussed more. – I think you might enjoy this three part podcast series about what it’s like to work for the “sharing economy”. It’s about a guy who tries to live for a month working only for Sharing Economy businesses:

  • YESSSSSSS! This article sums up the everything I’ve been trying to put into words for years now. Such an insightful piece. This is a play that the drug companies have had figured out for decades and now the tech companies are getting hip to the game… “there is no money in the cure, only in the comeback!” As long as you keep pumping in money, the content/services flow. But god-forbid you run out, they cut off the tap. Sadly, the millennials (and others by the way) are walking right into the pitfall.

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