Author Archives: Neil Morris

About Neil Morris

http://ca.linkedin.com/in/neilmorris

Riding madly off in all directions

If there are days when it feels like the world is riding madly off in all directions, it probably is. Change is the culprit and it’s never happened this fast or in so many places at the same time. Nothing in our experience has equipped us to deal with it.

Parents who are sending their children to university in the current economic and technological climate expect that when their children graduate, the jobs they’ll be applying for will be as traditional and as plentiful as they were in their parents’ day. They may be in for a surprise.

Employment relationships aren’t what they used to be. Corporate tastes in university degrees have changed. We have to factor that into how we think about the role higher education is going to play in the life of our children and what their options are going to be. Change is a fact of life for real companies and organizations with real names. Our kids need to know which companies and organizations they are or are likely to be.

We also have to bear in mind that the cost of tuition has risen 40% in the last 10 years. That will continue. Over 50% of all jobs are now precarious. Over half of those jobs will be automated in the next 10 years. That, too, will continue.

The links in what follows will take you to articles and reports about the current environment and how it will impact on your young people and those of people you know. They feature GE’s Jeff Immelt (#4), MIT’s Erik Brynjolfsson (#12), McGill’s Suzanne Fortier (#12) and Google’s Sergey Brin (#16), among others.

  1. September 1969 — The first node of ARPANET installed at UCLA
  2. August 12, 1981 — IBM introduces its first personal computer
  3. July 15, 2014 — Apple and IBM Forge Global Partnership to Transform Enterprise Mobility
  4. August 4, 2016 — LinkedIn interview with GE CEO Jeff Immelt: “Culture is not just apps. It’s a combination of people and technology. If you are joining the company in your 20s, unlike when I joined, you’re going to learn to code. It doesn’t matter whether you are in sales, finance or operations. You may not end up being a programmer, but you will know how to code. We are also changing the plumbing inside the company to connect everyone and make the culture change possible. This is existential and we’re committed to this.”
  5. September 2016 Deloitte survey “Transitioning to the Future of Work and the Workplace, Embracing Digital Culture, Tools, and Approaches”
  6. October 22, 2016 — Finance Minister Bill Morneau offered this advice at a Liberal Party gathering in Niagara-On-The-Lake: “Get used to the ‘job churn’ of short-term employment and career changes.”
  7. December 17, 2016 — Morneau’s advisory council on economic growth predicts that: Fully half of all jobs will be automated during the next decade, making massive retraining a social and economic necessity.”
  8. January 14, 2017 — “Innovation key to achieving Trudeau’s resourcefulness.’” In order to move Canada’s reputation away from resources to resourcefulness, PM must break the mould of linear thinking.
  9. January 12, 2017 — World Economic Forum report: “The jobless world and its discontents, How can we prepare for a future where drones, 3D printing and automation replace jobs?”
  10. January 14, 2017 — The Economist: “Lifelong learning, How to survive in the age of automation” (Cover story and Special Report)”
  11. January 16, 2017 —As Robots Take Jobs, Europeans Mull Free Money for Al
  12. January 19, 2017 — Davos 2017 – Issue Briefing: Jobs and the Fourth Industrial Revolution
  13. February 2017 — Maclean’s print edition: “When robots steal your job”, The real driver behind re-shoring is automation. Robotic jobs, not human ones, are coming back.
  14. February 2017 — Automa-nation: Will robots take your job? A new report suggests 42% of the Canadian job market is at risk.
  15. January 17, 2017 — IBM THINK Blog, IBM Cognitive Principles
  16. January 19, 2017 — World Economic Forum, Davos 2017: Google’s Sergey Brin on AI

We’re told that we’re in the midst of the Fourth Industrial Revolution. We may not know how the story ends, be we do know that it will probably involve some form of advanced education. Our children have to be prepared.

 

 

“Control over change would seem to consist in moving not with it but ahead of it. Anticipation gives the power to deflect and control force.” Marshall McLuhan

Due diligence is behaviour designed to ensure before we put our money down that what we intend to buy and what the seller ultimately delivers are one and the same. Some would call that protecting an investment. Others would call it common sense. Personal Due Diligence calls it both.

Decisions about post-secondary education have consequences that involve life, career, family and financial stability. Too many parents believe that graduating from any institution of higher learning, university in particular, is a guarantee of well-paid, secure, predictable work. There are no such guarantees: only enhanced likelihoods. What we do know for sure is that we’re living in a post-industrial economy: yesterday’s manufacturing jobs and the ones that supported them are gone. What happened to blue-collar workers is now happening to white-collar workers. As Wikipedia puts it, “Information, knowledge, and creativity are the new raw materials of such an economy.”

According to the Conference Board of Canada: “The distinction between college and university is less important than the relevance of the discipline to the workplace, since it is relevance—along with supply and demand—that sets the market price for skilled talent.” Degrees in some disciplines are more likely to lead to work than others.

Research done in Alberta in 2005 showed that young people consult their parents in these matters more often than any other group and by a wide margin. But outdated ways of thinking, like old habits, die hard. Decisions based on wishful thinking rather than fact-based understanding of labour market and technological trends are some of the greatest risks our children face. The evidence has been accumulating since 2012 and the trend shows no sign of abating.

For now, the best defense against unemployment, underemployment and precarious employment for our children is due diligence. To quote The Economist, “[the] rise of the on-demand economy poses difficult questions for workers, companies and politicians,” and it comes with a considerable risk of displacement to which very few of us are immune. Due diligence is about minimizing the negative consequences of that risk. Or at the very least, knowing what the risks are and factoring them into the final decision to proceed with a university education. We should be making these decisions more with our eyes wide open and less with our fingers crossed.

In What is the Meaning of The Medium is the Message? Mark Federman, Chief Strategist, McLuhan Program in Culture and Technology wrote:

“Marshall McLuhan was concerned with the observation that we tend to focus on the obvious. In doing so, we largely miss the structural changes in our affairs that are introduced subtly, or over long periods of time. Whenever we create a new innovation—be it an invention or a new idea—many of its properties are fairly obvious to us. We generally know what it will nominally do, or at least what it is intended to do, and what it might replace. We often know what its advantages and disadvantages might be. But it is also often the case that, after a long period of time and experience with the new innovation, we look backward and realize that there were some effects of which we were entirely unaware at the outset. We sometimes call these effects “unintended consequences,” although “unanticipated consequences” might be a more accurate description.

“Many of the unanticipated consequences stem from the fact that there are conditions in our society and culture that we just don’t take into consideration in our planning. These range from cultural or religious issues and historical precedents, through interplay with existing conditions, to the secondary or tertiary effects in a cascade of interactions. All of these dynamic processes that are entirely non-obvious comprise our ground or context. They all work silently to influence the way in which we interact with one another, and with our society at large. In a word (or four), ground comprises everything we don’t notice.

“If one thinks about it, there are far more dynamic processes occurring in the ground than comprise the actions of the figures, or things that we do notice. But when something changes, it often becomes noticeable. And noticing change is the key.

“As McLuhan reminds us, ‘Control over change would seem to consist in moving not with it but ahead of it. Anticipation gives the power to deflect and control force.’”

2015 in review

The WordPress.com stats helper monkeys prepared a 2015 annual report for this blog.

Here’s an excerpt:

A New York City subway train holds 1,200 people. This blog was viewed about 3,800 times in 2015. If it were a NYC subway train, it would take about 3 trips to carry that many people.

Click here to see the complete report.

It’s not how much you spend on university. It’s how wisely

between friends


Rise of the ‘precariat
,’
the global scourge of precarious jobs

Barely one in four of the global workforce has a stable job, UN reports
– CBC News, World, June 1, 2015

Contract work is here to stay, says Bank of England governor
UK job market has changed permanently due to financial crisis, Mark Carney tells Treasury select committee
– The Guardian, November 25, 2014


In his Nov. 1, 2015, editorial ‘The 21st-Century Club’, Fortune editor Alan Murray said of the 13th Fortune Global Forum:

“We are now in the early stages of the third Industrial Revolution. New corporate behemoths like Google, Facebook and Uber are reaching Fortune 500 size at unprecedented speed. The century will belong to those who master this new model. Economic dynamism will matter more than sheer scale. The invitation-only CEO gathering (Nov. 2-4) will include leaders of many of the largest companies in the world and focus on the challenge of ‘Winning in the Disruptive Century'”. (You can view the agenda of the recently concluded event by clicking here.)

One of the advantages of living in the early 21st century is that all it takes to see how some of the most powerful corporations in the world are going to change the way we live and work is a few keystrokes. What the Forum attendees heard and discussed wasn’t ‘if’: it was when—and when is now.

Those companies will need the help of well-educated young minds and they’re not alone. They’ve declared their intentions publicly which means that the word is out on what kinds of schooling they’ll be looking for. Parents and children who plan to attend university have to read that word, understand it and act on it. We know the names of the people who are shaping the future and the names of the companies they head. The information they’re making available about what they’re thinking is free.

It’s not how much parents are spending on higher education that matters; it’s how wisely they’re spending it. It’s a lot cheaper to avoid making a mistake than it is to correct it. The two articles at the top of this page speak to the consequences. So does this story about the precariat by Joe Fiorito in today’s Toronto Star. How is someone who is just starting out supposed to repay student loans on irregular or inconsistent income? At what point will the rising cost of tuition put post-secondary education out of reach? What will the impact be on the universities themselves?

There’s a glut of degrees on the street. Jobs that used to call for a high school diploma now call for a degree but pay high school wages. Graduates are accepting them even though they aren’t full-time and employers don’t look gift horses in the mouth. Had graduates taken the time to scrutinize the labour market before they put their money down, they might not have run out of options.

We can’t blame all of this on graduates any more than we can blame all of it on universities or governments. But we can blame it on a changing employer-employee social contract that has already cost many parents their job. Why weren’t they and others paying attention?

The environment in which today’s jobs exist is as important as the jobs themselves. Free trade agreements are part of that environment. Compromises were built into every one of them. To get, we gave. And what we gave was often measured in jobs lost. Canada has entered into 44 of those agreements so far and concerns are being expressed about the Trans-Pacific Partnership, which has yet to be ratified. Politicians and businesspeople love to boast about how many new jobs the agreements they ink will create. What kind of jobs are they? Will they be permanent or precarious? What qualifications will they call for? How much will they pay?

In its Oct. 24th – 30th issue, The Economist published ‘Reinventing the company’. In its Nov. 1st issue, FORTUNE published ‘The 21st Century Corporation: Every aspect of your business is about to change’. This is what Geoff Colvin said in his lead-in:

“Imagine an economy without friction—a new world in which labor, information, and money move easily, cheaply, and almost instantly. Psst—it’s here. Is your company ready?”

Please be sure to read FORTUNE editor Alan Murray’s editorial ‘The 21st-Century Club’. It’s what the C-Suite is reading and it’s already here.

By no means does this apply to all lines of work or to all degrees or all post-secondary diplomas and certificates. But where it does, and if precarious employment is the outcome, how do we calculate the value of higher education? Or the cost? Is it the education, the way it’s chosen, or both?

Even if parents are prepared to borrow money to put their kids through college, someone is going to have to pay it back. In the States, 7 million have defaulted on their loans. The US$1.2 trillion owing isn’t the figment of someone’s imagination: it’s real. In Canada, the number is between C$25 billion and C$50 billion, and one family in 8 is shouldering the burden.

To see the numbers for yourself, go to Google Alerts and set it to deliver links to articles with the words “student debt” in them to your e-mail inbox once a day. You’ll average 10 per day, 7 days a week, 52 weeks a year. I have been since October 2012, and the problem isn’t confined to North America. To see what universities are doing to cope, research the Millennium Project at the University of Michigan.

The world isn’t going through a phase: it’s evolving. We’re experiencing an economic tectonic shift, a “third Industrial Revolution” as FORTUNE puts it. If you want to see what the World Economic Forum’s Global Competitiveness Report 2014 – 2015 says about how Canada is faring, click here.

The United Negro College Fund has been reminding us for years that: “A mind is a terrible thing to waste”. So is a university. If we continue to waste either or both, we’ll have no one to blame for the consequences but ourselves.

Is this why we’re spending money on higher education for our children?

Q: What do you want to be when you grow up?
A: Employed!

How are you going to explain that this isn’t your grandfather’s economy?

If deciding what university or community college or trade school your child is going to attend is starting to keep you up nights, you’ve probably visited more than a few of their websites. You’ve looked at the pictures of smiling faces, viewed the videos and read the inspirational language intended to convince you to spend your money, and, possibly, your child’s future, with the people on whose behalf those websites were created.

By now you’ve noticed that (a) you’ll have to do some digging to find any mention of tuition, fees and expenses because it would be in poor taste to publicize them on the home page; and (b) every one of those institutions is looking for a donation.

There are some who consider it gauche to have the words “money” and “university” in the same sentence. They would argue that higher education isn’t about money: it’s about introducing young minds to new ideas and new ways of looking at the world and themselves. It builds networks that include students who sit next to one another in lecture halls but live half a world away. Then there’s the benefit that comes from learning to fend for oneself away from home. This is the point where laundry and groceries enter into the discussion.

Those people would be right—to a point. But when the last glittering speck of that pixie dust that university websites magically create settles gently to the floor and the cool breeze of reality wafts through the room, the fact of the matter will be that nothing about attending an institution of higher learning is free. Once a child reaches the end of the taxpayer-funded, kindergarten/primary school/high school conveyor belt, decisions have to be made about the need for post-secondary education altogether. (P.S.: Taxpayer dollars pay for that, too.)

Even if his or her degree were paid for in full before the first day of lectures, the newly minted undergraduate or postgraduate is going to have to earn a living, especially if he or she is among the 40 million students south of the border who have US$1.2 trillion in student loans to repay, or the Canadians who owe between C$25 billion and C$50 billion. That money is going to have to come from somewhere. What about the cost of living? Will there be a new home or car to finance? Will there be enough money to pay the rent or buy food?

Finding work to pay for those things is the elephant in the room. Regardless of how many organizations the new graduate may have joined or voyages of self-discovery he or she may have gone on, if the résumé intended to support his or her application for that first full-time job is rejected by applicant tracking software for lack of key words and phrases, we have a problem. If the problem can be traced to a poorly executed résumé, the oversights can be corrected. But if the academic qualifications are wrong and creativity falls short of compensating for it, the only cure may be to spend 4 more years earning an education that will sell, but only after an in-depth reassessment of personal goals and what the economy needs.

As a country, we can’t afford scenarios like that because a mind is a terrible thing to waste (©UNCF). If you read or listen to nothing else today, please click on and ponder Robots Vs. The Middle Class (Bloomberg Businessweek, May 25 – May 31, 2015) and listen to Terry O’Reilly’s The Internet of (Marketing) Things (Under the Influence, CBC Radio One, Saturday, May 30, 2015). You’ll want to pay particular attention to O’Reilly’s thoughts about the Apple Watch.

How different is today’s economy from your grandfather’s economy? Well, did you ever doubt for a moment that your first job would be full-time with benefits? Are you doing now what you were planning to do then? Are you employed full-time? Have you been unemployed as a result of downsizing or outsourcing? Knowing what you know now, what would you do differently?

Would your grandfather recognize a world in which China is the world’s manufacturer, where 50% of working Canadians of all ages are not employed full-time, and where the price of post-secondary education is higher now than at any other time in history? What about a Canada where manufacturing has been decimated while employers continue to complain that they’re hard-pressed to find certain kinds of workers yet most of them refuse to train? What would he say about a Canada where $500 billion is sitting idle while vote getting corporate tax breaks underwritten by your tax dollars and mine go unused?

The North American work force is resolving itself into two camps: the one that recognizes that this isn’t your grandfather’s economy and is adjusting its expectations accordingly, and the one that doesn’t. One refuses to take career and labour market information at face value until they’ve confirmed it independently with multiple sources with their own eyes, not once but several times. The other doesn’t. One studies industries, market trends, the impact of technology and the performance of employers because they recognize that large numbers of dollars are at stake, not only the ones they’ll spend acquiring the necessary education, but the also the ones they risk not earning by failing to do their personal due diligence. The other doesn’t.

The economy is the financial air we breathe. We ignore it at our peril. Since 2001, I’ve met face-to-face with 2130 working people who, five minutes before I walked into the room, lost a job they thought wasn’t at risk. Most of them believed that where the world is going didn’t apply to them. They were mistaken.

F. Neil Morris
President & Founder
Personal Due Diligence
+1 (905) 273 9880

A riddle with a twist

What costs $24,000 or more; takes 4 years to deliver; can’t be insured; has no cash surrender value; can’t be returned or exchanged; comes with no performance commitments and is covered by the two-word guarantee: caveat emptor?

An undergraduate degree.

Such is the mystique surrounding universities that otherwise perfectly rational human beings line up like lemmings to press hard-earned money into the palms of people who work in registrars’ and admissions offices. This in spite of media coverage of the plight of university graduates who’ve watched employers devalue and demean their diplomas and the four years of work that went into earning them by offering unpaid internships, short term employment contracts or permanent part-time engagements. No benefits, no stability, no prospects. The labour market in Canada and elsewhere is awash in undergraduates and post-graduates who are free to sell their services at whatever severely depressed prices the market dictates, or run the risk of earning next to nothing or nothing at all.

Employers are playing the game according to the rules of supply and demand in pursuit of profit and positive return on investment. The question is, by what rules are parents playing that we’ve arrived at this point? How much damage is inadequate decision making going to do to the financial future of our children and, quite possibly, the country, before we accept that we’re in a buyer’s market for certain kinds of education. The university degree is a commodity and it’s in oversupply in certain disciplines. Every new diploma in those disciplines that hits the street and has no takers drives down its own value and the value of diplomas like it.

Parents who choose to sleepwalk through these economic times when it comes to choosing post-secondary education are bringing about precisely the outcome they spent so much money trying to avoid. Absolute trust in the inevitability of work for all bearers of all university diplomas is out of place in 2015.

Management training: Keeping it on the company campus and How to join the 1%are two articles from The Economist that show just how quickly some in the business community adapt to new ideas. And if those ideas don’t pan out, there are always new ones waiting in the wings.

I’m a firm believer in the need for healthy, affordable universities. My children and their spouses are now established undergraduates and post-graduates. Where else are the people we’re going to need to get on with the rest of our life going to come from if not from universities, community colleges and technical schools? I’m not just talking about medical and other professional people. I’m talking about people who’ll come up with better ideas than the ones we have now about climate change, air pollution, land use, R & D, manufacturing, natural resource extraction, inadequate transit and drought in key food-producing regions of the world, just to name a few.

Those temp jobs that always seemed to be there for anyone who needed a little spare cash every now and then have morphed into the new normal for 50% of working people of all ages, yourself included, dear reader. And not only in Canada.

Head-in-the-sand attitudes, not mass hypnosis, are responsible for the outbreak of PEV (precarious employment virus), aided and abetted by vote-buying tax breaks paid for with taxpayer dollars that were supposed to generate work for Canadians but instead have accumulated to the tune of over C$500 billion in dead money according to former Bank of Canada and now Bank of England governor Mark Carney:

“Bank of Canada Governor Mark Carney has taken a rare swing at corporate Canada, accusing companies of sitting on huge piles of “dead money” that should be invested productively or returned to investors. ‘Statistics Canada numbers show Canadian non-financial corporations with a cash hoard of $526-billion at the end of the first quarter of 2012, an increase of 43 per cent since the recession ended in 2009.’”

Universities cater to the demands, not the needs, of the students who make up the bulk of their clientele. What students need is a strategy to deal with employers who won’t offer full-time employment. One way to deal with them is to not plan to work for them. Would you approve a mortgage or car loan for someone who can only find part-time work? Wouldn’t it be ironic if we reverted from being a cashless society to a cash-only society? As PEV continues to spread and economics forces more and more families to consider options other than university, employers will have to raise salaries, train, and revert to the full-time employment model to attract the talent they need. But that won’t happen overnight, if it happens at all.

A review of the literature dating back to the early 2000s will show that many universities are struggling to cope with reduced government funding, declining enrollment and the impact of technology. You might want to read what James Duderstadt, President Emeritus of the University of Michigan, had to say about the subject in the ‘Emory Report dated March 20, 2000.

The era of ‘you pay your money and you take your chances’ is drawing to a close. Forty million Americans owe US$1.2 trillion in student debt. Seven million have already defaulted on those loans. Many of them haven’t or won’t complete their programmes. Still, universities have no incentive to scale back their student intake based on the demands of the economy when they can collect 100% of their ‘fee’ from each graduate they produce regardless of whether that graduate finds work or not. It’s that intake that attracts government funding. Why does the buying public accept that?

According to The Guardian, the Bank of England believes that contract work is here to stay. Parents and their children may not agree with that assessment, but due diligence demands that, at the very least, they take all reasonable steps to assess its implications.

If you have questions, PDD has answers. I invite your inquiries and your comments.

Sincerely,

F. Neil Morris
President & Founder
Personal Due Diligence

+1 (905) 273 9880

A 5-minute survey on hopes, dreams, tuition, precarious employment and post-secondary education

Higher education is the single largest investment most people will make in their lifetime, after a home

— Neil Morris, Founder & CEO, the Personal Due Diligence Project (PDD)

Saturday, April 18, 2015

 

Conventional wisdom and statistics have traditionally maintained that an advanced education is one of the better ways to protect children from an uncertain economic future. In some cases it still is, but in a growing number of what used to be safe cases, it isn’t.

“Don’t trust anyone over 30” defined the ’60s. “Ich bin ein Berliner” defined the Cold War. Some day, a future historian may paraphrase Stephen Leacock and say that we were living in a world “[riding] madly off in all directions” with an iPhone in one hand, an iPad in the other and (as of April 24th) an Apple WATCH on its wrist.

That all 3 three devices originated with a single company is a fascinating story in its own right, and it’s still being written as you read this. The WATCH is the first all-new product to be conceived, developed and released since the passing of Steve Jobs.

Also evolving is the 140-year-old company that was once considered the antithesis of Apple. That evolution has given rise to WATSON, and, among other things, to a 7-year contract with Apple to develop apps for the iPhone. That company is IBM. You owe it to yourself and your children to watch and THINK about this interview with IBM CEO Ginni Rometty from start to finish (15 minutes). Then there are C|NET stories 1and 2 you can find here. The big story is the evolution of technology. The really big story is how it’s contributed to the evolution of the 7.2 billion people who live on this planet.

All of the companies mentioned in these stories accepted that to survive, they had to leave large parts of their past behind. Now comes the question, “How will our thinking have to evolve so that we and our children can survive precarious employment? It’s because of that question that I hope you’ll take 5 minutes to complete PDD’s on-line survey ‘Hopes, dreams and tuition’ by clicking here. And to ask that you pass this link along to anyone you know who plans advanced education for his or her children. All responses are strictly anonymous. The survey tool does not identify respondents.

Thank you for your interest and your participation.

Sincerely,

F. Neil Morris
Founder & President
The Personal Due Diligence Project

+ 1 905 273 9880