This week we look at the ups and downs of markets and how to incentivize labor.

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Research Roundup

Market Cycles

We think a great deal about the jobs of the future (I give keynotes on them), but we need to think just as hard about the workers of today.

You cannot automate the unknown, but a factory job? Hell yes! As the automation of routine tasks increased over recent decades metros dominated by routine labor shifted “low-skill labor” into lower paying service economy jobs, even as outside workers moved in those regions to fill higher-skill, higher-pay jobs. So much for reskilling.

One unpredictable force did push wages strongly back in the other direction: the 2020 Pandemic. Initial mass layoffs followed by government support allowed more job-to-job transitions, especially among young, non-college educated workers, driving up their wages. As these labor markets tightened, rapid wage growth at the bottom that reduced the college wage premium and countered some of the growing wage inequality. 

Chasms grow; chasms shrink. This gives us lessons on how our policy choices can bridge the generational labor divide being driven, but not inevitably, by AI.

Incentivize Impact, Not Hours

Want employees to work harder? Show them that their hard work will pay off.

Mothers earn much less than fathers when kids are young and care hours must be substituted for work hours. This is particularly true for less-educated hourly workers. But even as kids grow and university-educated professional mothers can devote more time to their careers, their gains are outpaced by dads. Penalized for being a mom; penalized for being a woman; and, the penalties get worse when you finally invest more fully in your career. What a terrible incentive!

My own research (“Represent!”) shows that younger women invest more time in their careers when employed by companies with salient female leaders, suggesting the evidence that their hard work will pay off (“subjective utility”) increases engagement.

Of course, another approach is to reduce the incentives for any employee to work performatively long hours, especially early career professionals. “The gender gap in pay would be considerably reduced and might vanish altogether if firms did not have an incentive to disproportionately reward individuals who labored long hours and worked particular hours.”

Why would anyone invest themselves in their work without the evidence that their effort will pay off? Incentivize impact, not hours.

Weekly Indulgence

TNW Amsterdam…here I come! I’m giving 3…4 talks in Amsterdam.

Get your ticket to TNW and come see me wax poetic, rave rakishly, and mutter maddeningly.

It’s time for Fiduciary AI!

My oped “AI needs a constitution” has been republished by the Sutardja Center for Entrepreneurship and Technology (SCET) at UC Berkeley.

Read it at https://scet.berkeley.edu/ai-needs-a-constitution/

Stage & Screen

• June 18, Stockholm: Hyper Island is hosting an AMA for me in Sweden!
• June 19, Stockholm: Buy tickets for the Future of Talent Summit and so much more!
• June 20-21, Amsterdam: TNW ...well, I don't know exactly what I'll be talking about, but it will be huge!
• June 21, Leeds, UK: Society of Otolaryngologists What else: changing education for doctors in an AI-rich world.

Find more upcoming talks, interviews, and other events on my Events Page.

If your company, university, or conference just happen to be in one of the above locations and want the "best keynote I've ever heard" (shockingly spoken by multiple audiences last year)?

<<Please support my work: book me for a keynote or briefing!>>

SciFi, Fantasy, & Me

I just finished watching Scavengers Reign after seeing some very strong reviews. The series feels like Miyazaki rifted on Avatar. While I definitely recommend the series, I’m split in my response to it. The visuals are beautiful and the characters' stories engaging. The rather mystical, hyper-evolved conception of evolution and ecology, however, left me wanting a more substantial exploration of the complexity and “magic” of a messier ecosystem.

Excerpt: "What are fanatics?"

“Fanatic.”

Just having read that word, I can probably guess the unflattering images going through your mind. 

Churchill offered a slightly more benign portrait, “A fanatic is one who can’t change his mind and won’t change the subject.”(Though given that it's a famous Churchill quotation, he probably never said it.) If that’s our working definition then anyone who’s ever been trapped in a conversation with me has learned the hard way that I’m a fanatic. And I am. Proudly. For 20 years as a neuroscientist, inventor, entrepreneur, a mom, and frankly, a repeat failure, I have been driven to understand how to build better people. My research has returned again and again to the power of the fanatic.

I was once invited to visit RedBull’s US headquarters in Santa Monica to meet their athletes, and had lunch with a fellow named Rodney Mullen. Now Rodney, in addition to having given quite an enjoyable TEDTalk himself, is arguably the greatest skateboarder of all time. For years, he and Tony Hawk dominated the sport, winning dozens of World Championships. 

During our lunch, Rodney expounded upon his love of skateboarding.

But I don’t give a damn about skateboarding. I wanted to ask Rodney what he did after he defended a world title. “Well,” he said, “Tony and I would go to the after-party and drink some champagne and, I don’t know, 20 or 30 minutes later, we’d be out back practicing new moves.”

He had just won his fortieth world championship. Who’s gonna beat him? It’s his party. And believe me, Rodney likes to party. But he doesn’t care. Rodney is a fanatic.

So, when I talk about fanatics, I’m clearly not talking about religious mania. I’m talking about endogenous motivation, that drive that comes from within. Where exogenous motivation—sensitivity to praise and bonuses and punishment—fails, endogenous motivation brings about the intrinsic curiosity and personal drive that powers the fanatic.

Find out what else it takes to be a fanatic when How to Robot-Proof Yourself hits the bookshelves!

Vivienne L'Ecuyer Ming