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COVID-19 is accelerating automation in the workforce: WorkMarket Founder

As states reopen, more companies look to technology and AI to limit prevent the spread of coronavirus in the workplace. WorkMarket Founder Jeff Wald joins Yahoo Finance’s On The Move panel to address the future of jobs and changes in the workplace post-pandemic.

Video Transcript

ADAM SHAPIRO: Welcome back to Yahoo Finance "On the Move." The initial claims for unemployment reading that we got today with almost 40 million Americans unemployed begs the question about what's going to happen to the job market. And our next guest says while we may have all lived through the tech revolution, we studied the Industrial Revolution, we are in the midst of the first services revolution in which we're going to lose up to 15% of jobs, but don't fear. They'll be offset with new jobs.

So to discuss this and the end of jobs-- that's the title of the book coming out June 2-- Jeff Wald, who is the founder of WorkMarket and author of the book "End of Jobs," out June 2. Jeff, thank you for joining us.

JEFF WALD: Thank you so much for having me.

ADAM SHAPIRO: OK, so we're in this revolution, the services revolution, which, you know, the headline-- we could lose up to 50% of services jobs-- would panic a lot of people. But you say not so fast.

JEFF WALD: Well, you know, Adam, I wrote the book to try to bring some clarity to the discussion on the future of work. It gets very frustrating for those of us in the world of work when predictions are made that aren't based in historic trends or in the data on the current labor market. And so a lot of people saw the Oxford University study, the McKinsey study. And, you know, in our social-media-driven world, the headline became 47% of jobs from Oxford, 50% from McKinsey. Those jobs are going to go, and that's just not accurate.

And so I spent a number of years researching this as I ran my company, WorkMarket. And, you know, I wanted to bring some clarity because, historically, we've been through these types of transformational technology improvements before.

JULIA LA ROCHE: Hi, Jeff. It's Julia La Roche here. I want to talk a bit about what's in your book. And you talk about agile work, which is much different than the way we're currently working. And right now in this environment, we've seen this shift from office first to remote work. I want to know what kind of skills need to change in that process. Do we need a rethink of leadership? And do you think the remote work will be more enduring as we emerge on the other side of this pandemic?

JEFF WALD: So remote work will certainly be more enduring. You know, in the book I talk a lot about our movement from the one-office, one-manager 9:00 to 5:00 job, which was the job we've had for 50, 60 years, to this fluid, team-based, work-from-anywhere, always-on job. And that transition was beginning, and this current health crisis will accelerate that trend.

And let's go back to data. So over the last 10 years, the remote part of the workforce doubled. It went from about 1.5% to 3% of the labor force. It is currently about 40% of the labor force.

The impediments to remote work growing even more prior to this crisis were that it was mostly the employee asking to work remote. It was mostly turned down because companies didn't have the policies, procedures, and, importantly, the infrastructure to allow remote work at scale. Clearly over the last 10 weeks everybody had to put those all in place.

And so when you think about remote work now as opposed to before the crisis where I would have said remote work is going to go from 3% to maybe 4% over the next 10 years, now those of us that study the history of work, those of us that study the labor statistics would say remote work's going to advance to about 8% of the labor force-- so a substantive, substantive change.

JULIE HYMAN: Jeff, it's Julie here. Let's talk about another change, and you're talking about how sort of the conventional ideas about AI and robotics and replacement of workers, that they're not necessarily correct. I want you to walk me through an example, if you wouldn't mind.

So Gap, for example, just announced that they are going to be accelerating an order for some robotic sort of packers at their warehouses, stuff that-- you know, machines that put orders in packages to be sent out, that they're accelerating that order because of this pandemic. What about the workers who would have been hired to do that? Walk me through what they do now and how maybe new jobs are created for them somewhere.

JEFF WALD: Sure. It's a very big question, Julie. So, I mean, look, what we're seeing with this COVID crisis is the acceleration of existing trends. Those workers would have been replaced. They may not have been replaced another 5 or 10 years, and now because of this crisis, things are being accelerated, and they're being replaced quicker. I would never argue that people that are doing what we call repetitive, high-volume work-- that work is going to get replaced.

But what becomes important to understand is when you look at jobs and you look at the different component tasks of jobs, only jobs that have 50% or more of their component tasks that are repetitive, high-volume tasks historically tend to get replaced. And so there is no doubt that more jobs are going to get replaced quicker, but it doesn't change the underlying math of the number of jobs that have a high percentage of their component tasks that are automatable. Those jobs are going to go, and they were always going to go.

So when we think about things like a waiter or a waitress, look, the technology to remove that job has existed for 10 years, and yet the number of waiters and waitresses has grown. So it's not just as simple as, well, if it exists, they'll get replaced. There are a lot of complexities to this.

ADAM SHAPIRO: Hey, Jeff, real quick, you in the book talk about IBM's old business model. You were either part of the deep-blue team or the light-blue team. How has that changed for people who will no longer have a lifetime employer?

JEFF WALD: Well, you know, we talk a lot about-- in the book about using statistics to dispel notions. First, let's start with every time anyone gets into a conversation about the future of work, they for some reason always go back to the IBM job of the 1960s, this paragon and this notion that you work there for 40 years. You march towards your gold watch.

I do not doubt that at a company like IBM, a company like Pepsi, which was actually the first company ever to give a gold watch upon retirement, that those jobs existed. But when you look economywide, the average amount of time a person spends on a job today is 4.2 years. In 1960, it was about 4.5 years. That is not to say that the lifetime-employment job didn't exist, but it didn't exist for every worker in the American economy. It is rather a notion or a myth.

And so that IBM worker in the 1950s and 1960s, some of them were fully deep blue and had a defined-benefit pension plan and IBM looked out for them for life. But let's not pretend that that was every worker at IBM, and it certainly was not every worker in the United States.

ADAM SHAPIRO: All right, Jeff Wald is the author of the book the "End of Jobs." It comes out June 2. And set your calendars for January 2040. No joke. Jeff is awarding $10 million to one of the contributors to the book who gets it most accurate as to the future of work. Jeff Wald, we appreciate you joining us "On the Move."

JEFF WALD: Thank you for having me.

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