Technology destroys and creates

In his Nov 16 2009 Forbes article titled “Churn, Baby, Churn”, Brian Wesbury, chief economist at First Trust Portfolios L.P. notes that while unemployment in November 09 is at a 26 year high, the market is much healthier than that statistic would imply.  Here’s how.

Expanding companies and new business starts added 27.9 million jobs in 2008. Contracting companies and business closures cost 31.4 million jobs.  Unemployment claims, the headline-grabbing statistic, is by far a much smaller figure – on the order of 250,000 jobs monthly (annualized rate: 3 million).  The pain, of course, is real if you are among that statistic.

Some of unemployment is due to the recession, and some can be blamed on panic, but technology is wrecking entire companies unable to adapt, while building new ones that can.  That huge jobs “displacement”, while excruciating in terms of its human toll,  is necessary for growth.

Technology eventually wins.  Highway construction jobs created by the recent stimulus plan will not.  They may release pent-up demand similar to the Cash for Clunkers program (which constricted the vehicle supply for Demolition Derby drivers), but that is short-lived.  In the long term, service industries like financial, legal, health care and leisure will be engines of growth – – but they will be delivered in a much more tech-savvy way.

Mr. Wesbury concludes: “Technology is the biggest source of churn – and, in the long run, the greatest source of hope”.


Look at what change technology has wrought for professional occupations like sales, marketing, PR, customer service, and product development.  Crowdsourcing, social media communities, all are indispensable; they make it easier to connect directly for improved results.

Your customers, partners, buyers and employees are on social media.  FaceBook and Google are among the top 5 most heavily trafficked web sites in the US, and in the top 20 worldwide.

Your challenge is to meet up online – in a conversational tone, not marketspeak.  Your customers are out there online, looking for you – and they’ve probably found you and made up their minds already.  Your new challenge is to meet them, listen, learn and adapt.

Will you get found and, if so, what will their impression be?

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