The employee-employer relationship is broken. 

Has history taught us anything?

Gallup’s employee engagement trends haven’t progressed much since they started reporting on it 20 years ago. It’s like a big glowing sign that reads, “Hey, boss! We don’t care.” To which the boss responds, “Hey, employee! Guess what? We don’t care either… or at least we haven’t had to.” I digress. The truth is that the employee-employer relationship has been broken from the start. Bringing workers together under one roof during the Industrial Revolution was hardly an act of unity. Most businesses view workers as a means to better production and higher output. The Human Resources department was born in the early 1900s out of the need to process worker complaints and mitigate the company from risk and lawsuits, not to create winning cultures. 

There’s no other business resource that can generate the return of a human worker. Increasing productivity and predictability of human labor is always a primary business objective. There’s no resource with greater variability and unpredictability. Assembly line workers of the early 1900s were hired hands, not brains. Command and control management worked well here. Increasing productivity was a simple formula - make sure they follow the process, have them work more hours, and keep pay low. Unfair treatment and an enormous amount of worker activism led to the passing of the Fair Labor Standards Act and introduced the 40-hour work week. Although this was a win for employees and a step in the right direction, I wouldn’t call it leverage.

Just as the assembly line revolutionized the workforce and scaled skilled workers through the first half of the 20th century, computers revolutionized and scaled the knowledge worker in the back half. Knowledge workers were different. They contemplated problems and built the problem solver (the computer). However, since knowledge workers created intangible products like plans, research, models, and content, measuring the productivity of knowledge workers has always been a challenge. These employees were exempt from overtime. They were known for working long hours, sometimes overnight, to bring their products to life. Since the one-roof concept of the Industrial Revolution was still in play, command and control leadership prevailed. 

The internet changed everything. Email allowed for swifter, real-time communication and sharing of files. Globalization proliferated. Businesses expanded. The internet introduced the concept of remote work. Not the balanced kind of remote work we think about today, but the “I need to check email on my vacation” or “I need to dial into an overseas meeting overnight” kind of remote work. The internet age made workers feel the need to be always on and informed. The advent of the smartphone soon after further exacerbated this need. It created a psychologically unsafe environment and gave employers more leverage.

It’s taken nearly a quarter century to popularize the power of remote work. The collapsing of physical boundaries frayed workplace tethers and fed our desire for autonomy and independence. The pandemic was like a punch to the face. What the hell am I doing with my career? What is all this worth? Just as companies realized long ago that humans are the greatest asset, we are finally starting to realize our careers are our greatest asset.  Self-discovery journeys are everywhere, and so much hangs in the balance for “at-will” employment as we know it.

Employers have all the leverage, but not for long.

Where we are now.

Currently, US business subscribes to the notion of “at will” employment, which simply means you are willing to risk immediate termination at any time. Most people don't have the financial independence or agency to take a risk and quit on the spot. This is a David and Goliath situation. For many, choosing where to work means simply going to the lesser of two evils regarding trust, compensation, benefits, and career advancement opportunities. The recent market volatility has shown just how little leverage employees have. This happens when humans are viewed as the means to production and not an integral link to value creation. 

Companies that follow best practices try to show workers they care by paying on the higher end of salary ranges, providing professional development programs, and attempting more amicable separations on the way out. European countries have progressed much farther on this more empathetic employment journey. Even still, the regulations and governance meant to protect workers are slow and often outdated from the start. The increase in regulatory employment requirements, coupled with the fact that human resources are the biggest budget line item, serves as a business incentive to adopt technology that eliminates human error and involvement. This is where the fear of “the robots are coming to take our jobs” comes from. 

At Lever Talent, we see a more positive story unfolding. Technological evolution actually stands to shift the balance more in the workers’ favor. 

5 Trends Shaping the Future of Work for Good

These are the five major trends we see shaping the future of work. We’re not talking about hybrid work and leading geographically dispersed teams (that future is already here!). These are the major trends to unfold over the next 15-20 years and change work for the better. 

1. Technology is freeing humans up to do more meaningful work. 

It may feel like the pace of technological change is rapidly increasing, but that’s a fallacy. The actual pace has not picked up in recent decades. It’s more so that the type of technological change we’re experiencing is directly affecting the role that we humans play in making the world go round. It’s a self-fulfilling prophecy. Our use of electronic devices generates massive amounts of data. And now, bots are being programmed to take action on this data, sometimes encroaching on the peripheral of what we currently consider knowledge or creative work.  sometimes in the form of knowledge work.

It’s easy for some to think, “we’re getting replaced.”

This fear of being replaced is nothing new. When the ATM was introduced in the late 1970s, there was great fear among the retail banking industry that the bank teller would go extinct. It turns out that the ATM increased the accessibility of banking to underserved communities and, with it, increased the need for more comprehensive banking services - loans, savings accounts, check cashing, etc. Today, there are actually more retail bank tellers than ever before. Mobile banking has even bolstered this need. 

The story of the ATM is one of many that shows this phenomenon we repeatedly see across almost all industries - technology may shift the jobs of humans, but it rarely replaces them. In many cases, the same, if not more, workers are needed to keep systems operational or manage the increased growth technological innovation creates. Humans aren’t replaced, but rather, their role evolves.

The same fear-based headlines that existed when computers were introduced in the 70s we see today with generative AI. Artificial Intelligence is a field of computer science that includes two different frames of thought. (1) Artificial Intelligence (AI), or the replacement of human intelligence, and (2) intelligence augmentation (IA), or the use of technology to augment human abilities, protect them from dangerous work, and allow them to scale their impact. 

There’s a philosophical debate here - does the technology exist to dumb humans down and free them from work? Or, does it make humans more intelligent and impactful? 

Machines are being programmed to take on the more tactical and transactional elements of work, leaving humans to take on the more complex components of work that machines can’t. 

Philosophical rhetoric aside, technology has shown a penchant for worker augmentation over elimination. This can’t come quick enough - the global workforce is estimated at 3.46B and shrinking as a proportion of the world's total population. Machines are evolving to take on the more tactical and transactional elements of work, leaving humans to take on the more complex components of work that machines can’t. This will have major implications for the education system, where collegiate degree programs are quickly falling out of step with preparing graduates with the skills they need to start a rewarding career. There’s already movement amongst early adopters, in tech especially, to shift human worker experience criteria to skills over degrees.

It’s awesome. The machines are taking on the more tactical and tedious parts of work. So, what’s a human to do? Let’s chat about this in the second major trend.   

2. As machines proliferate, the need for human judgment increases.

Machines can't make complex decisions. They don't know which customer to target first, what product to build next, or which strategy to use. We’re a ways off from having artificial intelligence to comprehend the complex relationships of variables like the market we serve, our product roadmap, our distribution channels, or determining if someone’s plate can handle just one more project.

A work continuum emerges where we see the objective, or transactional, components countered with the more subjective, or relational, components of business and work. As businesses rely more on machines for transactional jobs, it’s pushing the reliance on humans for more relational jobs. In the future, humans will be relied on for their more human abilities.

The value of competencies like subjective decision-making, interpersonal relationship-building, communication, and emotional intelligence skills will increase. The freelance and fractional work movement is actually helping to accelerate this shift by allowing businesses to outsource roles that machines can’t yet do and are not critically linked to the company’s vision.

I saw the shift to objective and relational work playing out in real time while visiting a client in the port of Long Beach, California. With over 15 terminals and an annual throughput of 8 million containers annually, Long Beach is one of the 25 largest ports in the world. Working in a shipping port is a dangerous job. The sheer size of the equipment poses great risks, including death. Safety is paramount.

Over the decades, the terminals have adopted automation to increase safety and efficiency. One terminal, called the Long Beach Container Terminal, is the first US terminal to be upgraded to be autonomous. Although there are no longer workers to drive cranes and lifts to move containers, a long-time port employee shared that the port has essentially maintained the same human worker headcount of about 300 to run the terminal. Now, workers at the terminal mainly focus on machine maintenance and repair, operations, and logistics instead of dealing with the perils of container moving.

As the need for human judgment increases, humans will be empowered to act more human.

As the need for human judgment increases, humans will be empowered to act more human. Tasks like supervising machines, maintaining strong team relationships, upholding ethics and values, and making complex or subjective decisions are our superpowers.

And, as business begins to rely on humans for being more human, it will force us to think differently about how we measure performance. This brings us to the third major trend. 

3. Performance measurement will evolve to align human abilities with business value creation.

Performance measurement is woefully unsophisticated to meet the realities of the new world of work. Employee engagement surveys and processes help identify issues and misalignment to company purpose, but there is little standardized guidance on how to act on it. Performance management is more of a workflow and data management exercise than a true measurement and validation of worker performance. 

To make matters worse, each company operates like its own island. Take two product managers from competing software companies with competing products. Determine how each is evaluated on performance, and you will find very few similarities in what is expected of them, their responsibilities, the span of control, and how they are incentivized, measured, and rewarded. This is why when individuals decide to find new jobs, they are encouraged to map their resumes to the job ad. Few (read “no”) validated measures are in place to evaluate a candidate for a specific job, team, or company. 

Thankfully, humans are exceptional at heuristics or mental shortcuts. Our innate ability to guesstimate allows us to easily identify outliers. Even if we can’t quantify it, we know exceptional performance when we see it. Exceptional work warrants exceptional pay. 

The lack of standardization and inability to measure and compare human abilities has led to large compensation gaps for specific roles. These gaps will continue to spread as more exceptional workers are subjectively identified and given exceptional compensation packages. Instead of the top 2% making beaucoup bucks in a given profession, this pay-when-we-see-it method will balloon the percentage to double, if not triple, what it is today.

More workers making more money will pressure businesses to rationalize pay disparities and compensation plans. It will also create an imperative for businesses to address the performance standardization we lack. 

What new performance measures could look like for a worker in the future:

• Cognitive Ability: how well they can adapt and learn new concepts quickly
• Behavioral Attributes: measurement of their natural drives and behavioral tendencies
• Neuro Leadership Ability: how well they can interpret social cues and their ability to influence others positively
• Life Experience: their upbringing, studies, hobbies
• Network Effect: the size and intricacies of their network
• Working Years: how long they have worked in a specific profession and in total
• Historical Job Performance: a record of their direct goal attainment
• Skills: validated skills they’ve certified with training and/or learned on the job
• Team Performance: company, or team, goal attainment while they were there
• Work Experience: time they spent fulfilling specific duties, serving in specific roles, participating in specific initiatives at specific companies and in specific industries

Standardization of jobs and needed skills across industries is nothing new. But the need for new performance standards, coupled with the recent technological advancements, like Web3 and blockchain, bring much hope that they will become a reality. This brings us to our fourth major trend.

4. The proliferation of new technology, like Web3 and blockchain, will force the adoption of shared performance measurement standards.

Change or be changed. Web3 technology has introduced the power of decentralization and the ability to store data and digitally validate transactions, including contracts, with blockchain. Decentralized autonomous organizations (DAOs) already exist that incentivize and compensate for work completed a-synchronously. What good work looks like, how performance is measured, and what pay it warrants will evolve in light of this progressive model.

A lack of job performance standards makes validating worker performance and experience nearly impossible. This is why resumes, LinkedIn profiles, interviews, assessments, and reference checks are so heavily relied upon when evaluating job candidates. It’s astonishing how, with so much data, our ability to predict on-the-job performance is marginal at best. Resumes remain fraught with embellishments and interview processes fraught with bias. We have a ways to go if we want performance measurement to catch up to the current state of technology. 

So, what could sophisticated performance measurement look like?

Billy Bean changed the game of baseball by introducing an analytical approach to building a winning Oakland A’s baseball team on a tight budget. This is the story of Moneyball, where they created a data room and started identifying new metrics and stats to build models correlating individual player, position, and team-based stats with performance. As other major league baseball franchises became enlightened to these more sophisticated methods, standards for performance measurement across players, positions, and teams were realized. The environment is ripe for a similar performance measurement revolution in business. With a bit of a twist, however. 

Unlike in Moneyball, where standardized performance measures were driven by the franchises' need to build the winningest teams, in business, it is not companies driving this shift - it’s the worker. The pandemic ushered in the era of worker mobility and choice - there are opportunities abound to work remotely in the ways workers want (freelance, fractional, or full-time) and with access to training and upskilling. The days of working at one company for your career are long gone. Job mobility and accessibility are paramount. Workers will increasingly look to compile a mix of the best-suited jobs and companies to maximize the value of their careers. 

The workers' desire to aggregate data across multiple companies introduces a portability imperative for performance measurement data. There needs to be some way for workers to bring their validated resumes from job to job. This will obligate different companies to align on common standardized metrics and measurement methodologies. 

A world with an encrypted packet of validated performance outputs owned by the worker is entirely possible with Web3. In this world, a worker's packet (think of it as their baseball player card) could be populated with validated performance data and outcomes based on the performance measures I dreamed up earlier in this article.

A company’s slowness to adapt and accept workers’ newfound leverage will be an existential threat. Education systems, government regulations, investment models, and career development programs will also start showing their age.

Workers will continue gaining leverage over the next 25 years despite any economic bumps on the road. This will forever change the employee-employer relationship as we know it and brings us to our fifth and final major trend.

5. Workers will increasingly be empowered to take their career development and management into their own hands. 

Most career development services are subsidized by the employer, so the company is the primary beneficiary. Learning & development programs, management training, coaching, skills-based training - it doesn’t matter what is offered - if the program's desired outcome doesn’t align with the business's strategic objectives, the business won’t offer it. Even most talent agencies today don’t do much to help workers because they are really business agencies (follow the money). This leads to the pigeonholing of workers whose needs, desires, and aptitudes are subservient to the needs of this business.  

As compensation of top performers balloons, this will create economies of scale for a category of career development services that serve and are subsidized by the worker to emerge. Instead of counting on employer subsidies, workers will seek out services to design a career schematic. Imagine entering the workforce and having a 20-year plan that outlines the milestones needed to make the most out of your peak earning years. Like a career GPS, You could monitor progress every 2-3 years to refine goals, pivot, or continue tracking toward your current objective. 

Fueled by their desire for independence and control over their careers, the next generation of workers will operate as free agents in search of their next big contract.

 

Fueled by their desire for independence and control over their careers, the next generation of workers will operate as free agents in search of their next big contract. This will lead to the extinction of “at-will” employment. Workers will want a contractual promise from their employer to keep them there for the duration of their assignment. Severance terms will be pre-negotiated. The value of a worker will be viewed in contractual terms, and blitzscaling teams in the name of growth, only to lay many off later, will be a costly mistake and career-fatal executive error. 

As in professional sports, where athletic contracts correlate to historical performance or standardized tests, the next generation of workers will be hungry to hone their soft skills and acquire the hard skills and experience they need to land the most rewarding contracts possible. In this world, the employer-employee contract will be material. And, as we see in sports with scouts and agents, businesses will hire scouts to find talent, and workers will hire agents to find work and broker contracts. 

Business-sponsored career development programs will continue to proliferate - catering to specific workers on niche career paths. These programs will become the cornerstone of employer branding and recruitment programs for companies in the future. Companies will market with messages like “Get the skills and experience you need to become a talented AI query designer at Acme, co. Ready for the next stop on your career journey? We’re filling 2 and 4-year positions. Apply today!”

The future is bright.

The future for workers is extremely bright. The moment has never been better for the fulcrum to shift more in their favor - allowing balance to be realized. Technology may be the forcing function, but that doesn’t mean workers and business leaders alike have to stand idly by.

This paradigm shift to a worker-led career will lead to a restratification of workers and companies into something that looks a lot like a professional sports system (think farm, then minor leagues and major league systems). For instance, a farm system would comprise newer workforce entrants and the job types, departments, and/or entire companies that best suit them. Validated performance data and standardized measurement will allow workers to understand their value at any time and get the skills they need to increase their worth.

So what to do about all of this? Embrace the future. Your career is the most valuable asset you own. Seek to find leverage in yourself. Set career goals and communicate them. Take stock of what you truly value, level-set where you’re at, and optimize the time you have left.

This article is fueled by my obsession with the impact technology is having on humans at work. My point of view is shaped by the countless conversations I’ve had with folks across academia, business, investing, and economics, and I will continue to have many more.

However this vision moves you, let’s talk about it. Reach me at drewspeaks@levertalent.com, and let’s continue refining what this future looks like.

It’s ours.

Read this next: What economists have wrong about the knowledge economy.