Change is painful. Change is difficult. Change can cause the alphas and the elites of yesterday to be the downtrodden and the impoverished of today. Change can also lift the middle class up and provide a higher standard of living for all people. It is the people who prepare for and adapt to change who will be the leaders of tomorrow.
The world is aware that changes will continue to occur, yet many people resist it for fear of the unknowable tomorrow. This resistance manifests itself in short to medium term disturbances. People who are unprepared for the future are temporarily left behind as their skills become obsolete and new skills must be learned. As new sectors of the economy develop and expand, previous sectors are reduced and replaced. As a country progresses through these sectors, their stage of development progresses as well.
The primary sector of the economy encompasses extraction of raw materials. This includes mining and farming activities among other things, but with respect to the United States the focus will be on agriculture. The foundation of society rests on the ability to feed itself. An economy which is dominated by agriculture, therefore, is at the lowest level of societal development. While all nations need an agricultural industry, as a nation progresses and becomes richer, they begin to use capital to offset physical labor. A combine in a wheat field allows a single farmer to produce food necessary for many more people than that same farmer would produce swinging a sickle by hand. In 1880, almost one-half of the American workers were still farmers (1). In 2012, that percentage was down to just 1.5% of employment (2). It would be difficult to argue the United States is worse off as a nation because it can produce more food with less people, as this opened the opportunity for previous farmers to produce a more varied set of goods which greatly expanded wellbeing of its citizens.
The second phase of economic development is an economy that is dominated by industry. The industrial revolution in the United States brought about a massive change in the culture of the country and in the livelihood of everyday people. The effects of labor unions, child labor laws, food and drug regulations, and other industry-inspired changes cannot be understated. The United States went through many dark decades of unemployment, long hours, poor conditions, and general abuse of employees and the natural resources of the country. This period of pain from the late 1800’s to the 1940’s defined our nation. Booms and busts became more pronounced and more evenly distributed. Law and education finally caught up to the changing landscape of the nation, and after the dust cleared, the United States entered a period of economic growth and middle class dominance never before seen in the history of the world. Many Americans look back on this time as the Golden Age and want to bring this era of history back, but progress continues and Americans have found themselves in the middle of another massive shift in the dominant employment sector.
Since industrial dominance began to fade into a service-based economy in the 1970’s, Americans have found themselves in the midst of another transition. Many issues have awoken in the United States that were seen during the transition from Primary Sector dominance to Industrial dominance, but this time is markedly different. The progression of development in the United States has hit a point where it has entered a fourth phase of development without fully completing the transition into the third phase. Though not as violent or abrasive as the Industrial Revolution, the transition to a service-based economy has been fraught with the same general issues. Capital again has been used to replace physical workers in the industrial sector as it had done to farmers in the past. Industrial workers have found themselves unprepared and therefore at a disadvantage. Since then, the people left in the industrial sector have had less bargaining power to maintain the wage levels of the past. If this was to follow the formula of the past, this slowdown of employment in the industrial sector would be offset by a period of large growth in the standard of living in middle class Americans who transitioned into the service sector. Instead of having a period of time where the service sector was able to flourish and the middle class was able to improve it’s position, however, the age of technology and the digital economy have begun to take over. Many would consider tech companies to be a subset of the service industry, however, the same skill sets do not transition letween these; a distinction that has put workers at a crossroads.
Due to this new situation of swifter, overlapping progress, the middle class is left in a limbo of wage stagnation and uncertainty. The technology sector consistently boasts great salaries and benefits, yet education has yet to catch up, leaving many people behind before they have even entered the workforce. The solution is simple: do not resist. Change is coming and people must prepare or be left behind. The education needed to succeed in a changing economy must be sought out individually, as institutions are slow to adapt. For a person to stay ahead, the progression of the market must be taken into account. No one company or job is safe from change. If more people train themselves to be lifelong learners and look ahead into the future they will be able to anticipate and prepare for changing sector dominance and continue to raise their standard of living. As capital products become more advanced, people will continue to be replaced. Start anticipating and looking ahead. Once people start to look at the world this way, change will cease to be such a painful event, and the middle class will be able to grow and thrive like never before. By leaving behind the jobs of yesterday, the standard of living from yesterday is also left behind. To pursue continued growth and continued raising of this standard of living, the jobs of yesterday must be left behind, and the jobs of tomorrow must be prepared for and embraced.
1. Hirschman, C., & Mogford, E. (2009). Immigration and the American Industrial Revolution From 1880 to 1920. Social Science Research, 38(4), 897–920. http://doi.org/10.1016/j.ssresearch.2009.04.001
2. U.S. Bureau of Labor Statistics, Percent of Employment in Agriculture in the United States (DISCONTINUED) [USAPEMANA], retrieved from FRED, Federal Reserve Bank of St. Louis; https://fred.stlouisfed.org/series/USAPEMANA, March 16, 2017