This blog has written a lot about Singapore in the past, this speech by the country’s Prime Minister sums it up.
For other nations, particularly Australia, it’s time to stay paying attention to how the global economy is changing.
Singapore may not have all the answers and its government’s authoritarian tendencies may work against its ambitions to be a global tech and creative centre, but at least the government is staking a position in the new economy.
Yesterday we looked at the PwC report on the value of science and engineering education to the economy.
The survey wasn’t good news for the workforce with the survey predicting over two in five workers’ jobs were at risk as digital technologies changed industry.
Notable in the list were the industries PwC believed to be safe over the next twenty years; largely being the medical, health and ‘people’ businesses like public relations.
While the industries themselves might be safe, specific jobs in those sectors may not be so with roles ranging from hospital porters being replaced by robots to surgeons carrying out remote operations.
Looking at the list of relatively unaffected industries, it’s hard not to see how digital technologies aren’t going to disrupt those occupations.
PR for instance is undergoing a radical change as the media industry is being totally disrupted requiring today’s public relations professionals to have a very different set of skills to those of twenty years ago.
Those skills include a much more adept use of technology itself and having to deal with a faster, more fragmented industry.
Public relations professionals brought up in the days of boozy lunches and far off deadlines struggle in a time of bloggers, social media and data journalism.
Similarly medical practitioners, the top position on the list, have seen their jobs dramatically transformed over the past twenty years by computers and those changes are far from over as medical equipment gets smarter, personal fitness devices become pervasive and the amount of data being collected on patients grows.
Across the medical industry the roles of almost every occupation is being redefined as technology changes the tools they have, along with the nature of ailments their patients present with.
Some professions will grow but automation in those fields will grow exponentially faster, a good example being the fifth role on the list – database administrators and ICT security professionals.
Ensuring the reliability and security of servers and networks is going to become even more essential as the economy increasingly depends upon these systems however security and IT professionals are going to rely on algorithms and Big Data to manage the massive task they have – these are the opportunities for companies like Splunk and Microsoft Dynamics.
In all of these comparatively safe industries the jobs of tomorrow are going to need different skill sets to what they require today.
For workers in these ‘safe industries’ this means further education, training and reskilling to stay employed. Just being employed in a sector that’s expected to stay static or grow isn’t enough to keep your job.
Employers in these ‘safe industries’ also face a challenge in making sure their staff have the right skill sets to use the new technologies.
If you were running an airline in 1965 it would be cold comfort to look at the explosive growth ahead for the industry in the jet airline era when all your staff are trained to keep propellor aircraft in the air.
So when we talk about digital disruption, it’s not just about industries being shut down and jobs being lost but about radically changing occupations.
It would be a brave person to assume that just because their industry is safe, their own job or business is secure.
When discussing how industries are changing, the constant question is ‘what will happen to today’s jobs?’
Even in the Future Proofing Your Business webinar earlier this week this question was asked by a number of the small business owning listeners.
That concern forms the basis of the “A smart move: Future-proofing Australia’s workforce by growing skills in science, technology, engineering and maths” report released by accounting firm PwC yesterday in Sydney.
PwC’s report warns 44 per cent of current Australian jobs are at high risk of being affected by computerisation and technology over the next 20 years.
The report highlights that Science, Technology, Engineering and Maths (STEM) subjects are critical in the jobs that are going to benefit, or be created, by that technological change.
Sadly for Australia, and most of the western world, STEM courses are deeply out of fashion with students preferring to study in business related courses such as accounting, commerce and law.
As PwC flag, those industries are at risk with accounting at the top of the list for job losses.
On the other hand, PwC forecasts professions in health, education, personal care and – worryingly – public relations will be in increased demand. Something that may underestimate the effects of technology on those industries.
PwC’s main contention is that economies which want to compete in the new economy are going to need more STEM graduates.
The shift to STEM education is something the OECD highlighted in its recent report, OECD report How is the Global Talent Pool Changing?
In their report the organisation forecast that the number of students studying around the world would increase from 130 million today to 300 million by 2030 with all of that growth being in Chinese and Indian STEM courses.
Already that science and engineering emphasis is clear in today’s numbers.
To counter the drift away from STEM courses among students, PwC suggests a campaign to engage young people while they are still at junior school.
Sadly, that’s unlikely to work in Australia given the nation’s economy is built upon property speculation driven by the wealth effect of rising real estate prices.
Two nights before the PwC report one of the highest rating shows on Australian television came to its 2015 finale. The Block, which features couples renovating and flipping properties, finished its season the apartments being sold at auction at record prices and the contestants pocketing between 600 and 800,000 dollars for a few month’s work.
For young Australians the message from their parents and society is clear; don’t innovate, don’t create, just buy as much property as you can afford.
In the US on the other hand, the business heroes are the builders of new enterprises; people like Steve Jobs, Elon Musk, Bill Gates, Mark Zuckerberg and the founders of Google.
Other countries like Israel, India and China, are aspiring to be the next generation of tech leaders. That’s what’s necessary to build a dynamic economy.
As the PwC report claims, “the jobs most likely to endure over the next couple of decades are ones that require high levels of social intelligence, technical ability and creative intelligence”
Harnessing that combination of social, creative and technical intelligence is going to be one of the challenges for all economies in a decade of change.
Getting the supply of STEM skills right will be essential for success for all countries at a time when digital technologies will drive most industries.
can Wellington become a global tech hub? raised an interesting question, how big does a city need to be in order to be successful in the new economy?
Does a compact city with a few hundred thousand people have an advantage over several million inhabitants sprawling across a huge metropolis?
The romantic view is the smaller cities should prevail but history, particularly given the wide sprawl of Silicon Valley, indicates the opposite.
While Silicon Valley, and most of the other Twentieth Century industrial hubs like Detroit, were sprawling conurbations it may be this era’s centres are more compact with towns being walkable.
Certainly this is what we’re seeing with the tech industry’s shift into San Francisco as workers find they’d rather walk or cycle to work than spend hours on freeways each day.
So it may be the newer breed of businesses and industries that don’t need massive infrastructure also don’t need to sprawl.
If that turns out to be true then cities like Wellington could do well.
It bills itself as ‘the coolest little capital in the world’ however something is going on in Wellington, New Zealand’s capital city, as its technology sector takes off.
Last week I was in Wellington, partly to attend the Open Source, Open Society conference and also to have a look at how the city is doing so well as one of the leading startup cities.
While I’ll have a number of posts about the city, startup scene and conference over the next couple of weeks, it’s worthwhile noting some basic impressions that came from the visit.
The size of the city, Wellington is a small town with a population of 200,000, brings both advantages and negatives for the business and startup communities.
One of the advantages of being so small is the business community is relatively accessible, a number of entrepreneurs told me how easy it is for them to find the specialists they need given there’s usually two degrees or less separation between everyone.
Normally having a small business community means it gets insular, particularly in a capital city where the business of government can create a bubble effect. What’s notable about Wellington is most of the businesses are looking outward towards the US, Australia and East Asia.
The city’s intimate business environment also improves trust within the community as one Aussie expat told me, “if you rip off anyone in this town pretty well everyone knows about it by the end of the weekend. It keeps everyone honest.”
Being small, the city makes it easy to walk around which compounds the business networking opportunities. A businesswoman, who is also a lifelong Wellingtonian, observed how she allows an extra 15 minutes to walk anywhere as she finds herself stopping for conversations.
Having three successful businesses in the city – TradeMe, Xero and Weta – has both its upsides and disadvantages with the bigger players tending to dominate the employment market and funding opportunities.
Of the three businesses, TradeMe is the most domestically focused while Xero is growing in the tech sector and Weta is the most diverse with its range of special effects and movie production services.
With Weta, the business is exposed to the vagaries of the global film industry as Statistic New Zealand survey of movie production shows.
The film industry is one of Wellington’s important employers with the sector supporting around two thousand businesses in the city, although I didn’t get time to explore how much of an overlap there is between the tech and film industries.
TradeMe is largely a domestic focused business that provides a steady work and skills base for the local workforce. While it’s the least internationally exposed business of the three, it’s probably also the most consistent.
Xero, like Weta, is a globally expanding business and its success is attracting investors and expats from North America and Australia. While its the smallest of the three it’s probably the business that has done the most raise Wellington’s profile in the tech industry.
What’s particularly notable are the number of coworking spaces in Wellington ranging from the straightforward Bizdojo startup space and Creative HQ through to the quirky Enspiral coworking space.
The availability of shared spaces makes the city attractive to startups and adds to the vibrancy of the local tech community which links into hipster pursuits such as craft beer.
Communities like Enspiral also add another dimension to the local startup and creative industries environment by connecting entrepreneurs with their peers and service providers.
One aspect I didn’t get to explore while in Wellington was the relationship between the city’s business community and educational institutions, particularly Victoria University.
Similarly I didn’t get the opportunity to discover how much of a role local and national governments have had in the development of Wellington’s tech scene. It seems to be relatively hands off although some government agencies have supported Weta with co-investment funds.
What I did meet though were plenty of immigrants; from Croatia, Denmark, Holland, the US and, most of all, Australia.
Talking to some of the US and Australian expats it was clear that lifestyle combined with opportunity with lifestyle, as one Aussie emigre told me “I couldn’t get the water views, access to the city and be able to walk to work back home like I can here.”
While these are superficial thoughts that I’ll expand on over the next week as I decipher notes and listen to interviews, there’s no doubt that Wellington is carving a position as one of the global centres of the new economy. How big it becomes will depend on how many other businesses grow to the size of Xero or Weta.