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By I R VI N G WLAD AWSKYBER GER

Yes,itlookscool,butitdoesntsaymuch.TheroboticastronautXiaotianposesatatecheventinShanghai.
ZhangJiansong/ZumaPress

HeressomethingtochewonafterThanksgiving:Oneindirectresultofthedigitization
andautomationoftheworkforcehasbeentheelevationofhumansocialskillsintoone
ofthemostvaluedassetsontheshopfloororintheoffice.
Irecentlyreadaveryinterestingpaper,TheGrowingImportanceofSocialSkillsin
theLaborMarket,byHarvardprofessorDavidDeming.Mr.Demingspapershows
thatoverthepastseveraldecades,labormarketshavebeenincreasingly
rewardingsocialskills,thatis,interpersonalskillsthatfacilitateinteractionsand
communicationswithothers.Hepresentsevidencethatsince1980,socialskillintensive
occupationshaveenjoyedmostoftheemploymentgrowthacrossthewholewage
spectrum,andthatemploymentandwagegrowthhavebeenparticularlystronginjobs
thatrequirebothhighcognitiveandhighsocialskills.
Mr.DemingspaperbuildsontheworkofMITeconomistDavidAutor,aleading
authorityontheimpactoftechnologicalchangeontheUSlabormarket.Afewweeks
agoIwroteaboutapaperhepublishedthispastsummeronthehistoryandfutureof
workplaceautomation.Inthatpaper,Mr.Autorsummarizedthesharppolarizationof
jobopportunitiesthatstakenplaceintheUSoverthepasttwodecades,notingthat
jobopportunitieshavesignificantlyexpandedinbothhighskillandlowskilloccupations,

MorningDownload

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105

whiletheyhavesignificantlycontractedformidskilljobs.
Thereasonforthispolarizationisthatautomationhasbeenmostsuccessfulwhen
appliedtomidskillroutinetasks,thatis,tasksorprocessesthatfollowprecise,well
understoodproceduresthatcanbewelldescribedbyasetofrules.The
occupationsmostsusceptibletoautomationhaveincludedbluecollarphysical
activitiessuchasmanufacturingandotherformsofproduction,aswellaswhitecollar,
informationbasedactivitieslikeaccounting,recordkeeping,andmanykindsof
administrativetasks.Asaresult,theseoccupationshaveexperiencedthebiggest
declinesinemploymentopportunitiesandearnings.
Ontheotherhand,nonroutinetasksaremuchhardertodescribebyasetofrulesthat
amachinecanfollow.Theseincludemanualjobsinfastfoodrestaurants,janitorial
servicesandhealthcareaidesthatrequirerelativelylowskillsandeducation,aswellas
highskilljobsthatinvolveexpertproblemsolvingandcomplexcommunications
requiringstrongcognitiveskillsandacollegeeducation.
Mr.Demingspapershedslightonamysterythatsbeenpuzzlingeconomistsforthe
pastfewyears.Since2000,thegrowthofhighskilljobshasmarkedlysloweddown.
Whataccountsfortheunexpectedslowdowninthegrowthofthesejobs?
Coulditbethatadvancesintechnology,software,roboticsandAIarenowtakingthe
potentialforautomationtoawholenewlevel,includingtasksrequiringintelligenceand
cognitivecapabilitiesthatnotlongagowereviewedastheexclusivedomainofhumans?
Perhapsautomationisencroachingupward,beginningtosubstituteforprofessional,
technical,andmanagerialoccupations.Perhaps,thejobpolarizationMr.Autorwrote
aboutonly5yearsagohasturnedintoadownwardramp,withautomationnowaffecting
alljobs,routineandnonroutinealike.
But,asMr.Autorpointsout,thisexplanationdoesnotfitwellwiththepatternsofIT
investmentsince2000.Theautomationofmidskillblueandwhitecollaroccupationsin
the1980sand1990swasaccompaniedbyheavycapitalinvestmentsinITand
manufacturing.TherehasbeennosimilarsurgeinITinvestmentssince2000.
Instead,informationprocessingequipmentandsoftwareinvestmentwasonly3.5
percentofGDP,alevellastseenin1995attheoutsetofthedotcomera.
Mr.Demingsresearchshedsastronglightonthismystery.Heanalyzedchangesinthe
taskcontentofworkusingdatafromtheOccupationalInformationNetwork(O*NET),
whichisadministeredbytheUSDepartmentofLabor.Hethenfocusedonthechanges
inintensityinfourkeykindsoftasks:
routinedegreeofautomationandofrepetitionofthesamephysicalactivity
nonroutineanalyticalrequirementsformathematicalreasoning
servicedegreeofserviceorientationandofassistingandcaringforothersand
socialskillextenttowhichjobrequirescoordination,negotiation,persuasionand
socialperceptiveness.
Mr.Demingsoverridingfindingisthatdifficulttoautomatejobsareincreasinglythose
requiringsocialskills.HepresentsevidenceforthreeimportancefactsabouttheUS
labormarket:
Employmentgrowthinsocialskillintensiveoccupationshasoccurredthroughoutthe
wagedistribution,notjustinmanagementandothertoppayingjobs.
Since1980,employmentandwagegrowthhasbeenparticularlystrongin
occupationswithhighcognitiveandsocialskillrequirements.Incontrast,employment
hasfalleninoccupationswithhighmathbutlowsocialskillrequirements,suggesting
thatcognitiveskillsareincreasinglyanecessarybutnotsufficientconditionfor
obtainingahighpayingjob.
Routineoccupationstendtorequirerelativelylowsocialskills,whichfurtherexplains
theiremploymentandearningsdeclinesoverthepastfewdecades.
Whyaresocialskillssoimportantinourfastchanging,technologyintensiveeconomy?
Letsdiscussafewpotentialanswerstothisimportantquestion.
Computershavemadehugeadvancesinautomatingmanyphysicalandcognitive
humantasks,especiallythosetasksthatcanbewelldescribedbyasetofrulesandthus
capturedinsoftware.But,asMr.Autorarguedina2014paper,despitecontinuing
advancesinAIandrobotics,thechallengestosubstitutingmachinesforworkersin
tasksrequiringflexibility,judgment,andcommonsenseremainimmense.
Centraltohisargumentistheconceptoftacitknowledge.Explicitknowledgeisformal,
codified,andcanbereadilyexplainedtopeople,capturedinsoftwareandexecutedbya
machine.Tacitknowledge,ontheotherhand,isthekindofknowledgethatwereoften

notawarewehave,andisthereforedifficulttotransfertoanotherperson,letalonetoa
machine.Generally,thiskindofknowledgeisbesttransmittedthroughpersonal
interactionsandpracticalexperiences.Everydayexamplesincludespeakinga
language,ridingabike,andeasilyrecognizingmanydifferentobjectsandanimals.
AsMr.Demingwrites,computersarestillverypooratsimulatinghumaninteraction.
Readingthemindsofothersandreactingisanunconsciousprocess,andskillinsocial
settingshasevolvedinhumansoverthousandsofyears.Humaninteractioninthe
workplaceinvolvesteamproduction,withworkersplayingoffofeachothersstrengths
andadaptingflexiblytochangingcircumstances.Suchnonroutineinteractionisatthe
heartofthehumanadvantageovermachines.Socialskillsareincreasinglyvitalinour
work,preciselybecausetheyarethemostintrinsicallyhumanandleastsusceptibleto
automation.
Asworkisbecomingmoreteambased,youdexpectthatworkerswithstrongsocial
skillswhoaremoreabletoworkwellwithotherswillbemorevaluable.Goodteamwork
increasesproductivitythroughcomparativeadvantage,thatis,thenotionthatdifferent
membersofateamshouldspecializeinthosetasksthattheyrebestat.Workerswith
goodsocialskillsshouldbebetterabletoplayoffeachothersstrengths,quicklylearn
whichtaskstheyareeachbestat,andflexiblyadapttochangingcircumstances.
Mr.Demingdevelopedamathematicalmodelofworkplaceteamproductiontoformally
testtheseideas.Thepaperdescribesthemodelanditsvariousfindingsingreatdetail.
Theseinclude:
Peoplewithhighersocialskillsearnmoremoney,evenaftercontrollingforcognitive
skillsandotherfactorsaffectingwages
Thosewithbothstrongcognitiveandsocialskillscommandthehighestwages,and
theirearningshavecontinuedtogrowsince2000and
Workerswithhighsocialskillstendtogravitatetoward,socialskillintensive
occupations,wheretheycommandhigherearnings.
Thesefindingsarenotsurprising.Thedigitalrevolutionhashadaprofoundimpactonall
oursocialinteractionsgivingustheabilitytocommunicatethroughavarietyofmeans
anddevices,easilyshareallkindsofinformation,andcollaborateonjustaboutany
endeavor.Digitaltechnologies,andtheplatformsandtoolstheyveenabled,have
radicallyamplifiedoursocialskills,transformingthewayweinteractandworkwitheach
other.Itstandstoreasonthatsocialskillsaremorevaluabletodaythanatanyother
timeinhistory.
IrvingWladawskyBergerworkedatIBMfor37yearsandhasbeenastrategicadvisor
toCitigroupandtoHBO.HeisaffiliatedwithMIT,NYUandImperialCollege,andisa
regularcontributortoCIOJournal.
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