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The Death of Average

In August 2015, Democratic presidential candidate Hillary Clinton released a major statement on college and university education. It was a sweeping Obama-esque kind of transformative initiative aimed at public expectations, parental aspirations, and the dreams of millions of young Americans. Clinton promised that, if she were elected, her government would provide massive increases in funding for universities, free college tuition, and major changes and many billions of dollars’ worth of other electoral goodies, all tied to the usual Learning = Earning formula of youth career preparation.

The Clinton plan is not simply unwise, but for a number of reasons it is counterproductive, reinforcing the false dream of millions of American young adults and putting increased national emphasis on one of the most narrow and uninformed public policy priorities of this generation: the idea that higher education always equals more income. America already has a college and university participation rate that is arguably too high, and now Clinton wants to expand it. In an interview, she said, “I want every parent to know that his or her child can get a degree or you can get one yourself.”[1] One hopes that she meant every child or person sufficiently intelligent and motivated can get one.

If the United States somehow had an endless supply of jobs requiring a college degree—something that is clearly not the case —her statement would make sense. True, the plan will not fund students at private colleges, only at public ones, but the prospect of free tuition at state universities and colleges is bound to increase enrolment, especially in the absence of strong entrance requirements. Is a college degree or diploma really the answer to America’s social and economic problems? Of course the United States has serious problems of social and economic equality, but higher education is not the panacea that by itself will cure them; certainly pouring more money into the system isn’t the answer. As it is, there are some private colleges with relatively low tuition fees (Berea College in Kentucky charges $870 a year), and the Clinton plan doesn’t pay for living expenses. There are a number of sources of money already available to needy students; notably, for Americans, the Pell Grant, which provides up to $5,700. There are a good number of public colleges with tuition fees lower than that.[2] And then there’s the question of fraud. The rules to prevent this aren’t clear, but you’d have to be naïve to doubt that fraudsters are already devising schemes to profit from Clinton’s plan, should it be enacted. It’s an all-round bad idea.

Disappearing Jobs and Careers

The obsession with the Dream Factories has become a serious American problem, and a global one too. While there are always improvements that can be made in the world’s most complex, comprehensive, and diverse post-secondary system, the reality is that governments—and politicians like Hillary Clinton—are looking at the wrong end of the problem. As economist James Bessen wrote, “This is today’s great paradox. Since the beginning of the personal computer revolution, the median wage in the United States has been stagnant. Information technology may even be hurting many white-collar workers, especially those with a college education. Voice mail systems have taken over from switchboard operators, automated teller machines do tasks of bank tellers, and computer systems have automated a whole range of routine clerical tasks. Workers in these occupations have to find new jobs or learn new skills to remain employed.”[3] For a generation, hoping to reproduce the positive and career-building experiences of the 1960s and 1970s, North American politicians and government officials have expanded the university and college system, believing that preparing an infinite number of young people through undergraduate education was the key to national competitiveness and personal opportunity.

For the college and university dream to work, graduates have to find stable jobs with decent salaries and good career prospects. Students, parents, governments, and institutions can control the input—the number of enrollees and a considerably smaller number of graduates—but the second half of the equation—careers—is tied to the vagaries of the global economy. In a crucial study of the technological revolution, Rik Brynjolfsson and Andrew McAfee argued:

[D]igitization is going to bring with it some thorny challenges. This in itself should not be too surprising or alarming; even the most beneficial developments have unpleasant consequences that must be managed. The Industrial Revolution was accompanied by soot-filled London skies and horrific exploitation of child labour. What will be their modern equivalents? Rapid and accelerating digitization is likely to bring economic rather than environmental disruption, stemming from the fact that as computers get more powerful, companies have less need for some kinds of workers. Technological progress is going to leave behind some people, perhaps even a lot people, as it races ahead … [T]here’s never been a better time to be a worker with special skills or the right education, because these people can use technology to create and capture value. However, there’s never been a worse time to be a worker with only “ordinary” skills and abilities to offer, because computers, robots, and other digital technologies are acquiring these skills and abilities at an extraordinary rate.[4]

The evidence shows, in fact, that the North American drive for more and more tertiary education has outstripped the needs of the modern economy, and that the resulting underemployment and unemployment has caused serious difficulties for a large portion of the current generation. And yet what passes for policy innovation in North America rests on doubling down on a failed and failing system. This is a gamble that the solutions of the 1970s, having fallen short of objectives for a generation, will somehow come right and solve the problems of the 2010s and 2020s.

New Technologies But Fewer Jobs

What is missing in Clinton’s strategy—and what is missing from political and public-policy debate across North America—is a serious consideration of the transformations affecting the modern economy. Ultimately, the mismatch between the degrees and expectations of university graduates and the job market is only half the story. The first fifteen years of the twenty-first century have seen the worldwide transformation of work through technological change. In sector after sector, machines and digital technologies have replaced workers, initially in small numbers, but increasingly in the thousands. The changes happened first in industrial and resource industries, destroying thousands of jobs in forestry, pulp and paper, and manufacturing. The transformation spread into the service sector, with online banking changing the roles of bank clerks, and with e-commerce and other technological solutions undermining work in many other economic sectors.

Even though the transition remains in the early stages, the mass use of robots has undercut a great deal of industrial labour. Henry Ford would have loved the almost worker-free assembly lines of the modern automobile factory, but North American workers are less impressed with the mounting job losses, made worse by the shift of factories to Mexico and other low-wage countries. There are many other examples. The development of computer-based income tax forms and e-filing has disrupted the personal accounting profession. Amazon.com, famous the world over for its e-commerce operation, is truly impressive as a technologically enhanced retail company, with modern, computer-controlled and automated warehouses. But spare a thought or two for the thousands of former warehouse workers being displaced by these new technologies.

The world now faces the real prospect of continued accelerated change and rapid job loss. Autonomous oil rigs and remotely controlled mining operations promise to eliminate thousands of jobs. The first autonomous oil rig in the Arctic went into operation in 2015, and Australia’s desert mines have been world leaders in remote-controlled extraction. The impact goes far beyond the miners and oil rig workers. Removing the front-line workers means immediate declines in on-site support staff, worker transportation, accommodation services, food and other delivery systems, and the related administrative activities. Companies wishing to stay competitive—particularly when working in high-cost remote regions, where extreme weather (e.g., 120°F in the Australian outback and -50°F in the Arctic) add to the difficulties of recruiting, retaining, and caring for workers—are strongly tempted to automate their operations as much as possible. But the job losses filter throughout the economy, cutting back on opportunities for young workers.

Outsourcing service and professional work to developing nations has eliminated many first-world jobs in recent years, and the advent of new technologies will likely accelerate the process. In the coming years, new technologies could conceivably overturn entire industries. Consider driver­less cars. You thought Uber was bad for the taxi business: autonomous vehicles will eliminate the need for taxis altogether, along with the industry’s expensive and cumbersome system of licences and government regulations. But individual car ownership will also be affected by the emergence of on-call services that will deliver a vehicle to your door and drop you off when you are done. Some experts claim—and this is where the transformative potential of new technologies becomes really fascinating—that driverless cars will result in a major decline in bodily injuries associated with auto accidents, which will in turn reduce the pressure on hospital emergency rooms, slash the number of specialized nurses and emergency physicians, reduce insurance premiums, and contribute to longer life expectancies. There is a lot of good news in there, as well as a good deal of futurist blather, but keep an eye on the number of jobs being lost and try to figure out what new forms of work and employment will emerge in their place.

Consider the transformative potential of 3-D printing. These new technologies, with applications ranging from the “production” of personalized candies to the “printing” of jet engines and massive sections of bridges, can stand traditional manufacturing and all of the related work on its head. The concept is simple. The 3-D printer downloads precise technical specifications over the Internet and, using extruded materials, produces the desired item. At present, home machines can be purchased for close to $1,500 and can pay for themselves in a year or two. The rapid innovations in the field will ensure that 3-D printers will be able to print complex machines, including circuit boards, fine art, engine components, human body parts (yes!), and many other things with a few clicks of a mouse. Again, follow the value chain in 3-D printing. The large-scale manufacturing plant becomes a thing of the past, but so does the warehouse, the trucking company, the retail store, and all of the employees associated with the intermediate steps.

Describing the advent of dispersed manufacturing, open innovation, and globally networked design, production, and marketing functions as the “New Industrial Revolution,” Peter Marsh wrote, “The way companies switch their approach to suit the broader platform for global manufacturing will be central to their, and the world’s future. ‘Design-only’ manufacturers will become a more substantial and dynamic group. Such businesses, predominantly located in the high-cost regions, will employ large numbers in product development. They will leave physical production to others, mainly in parts of the world with lower wages.” Marsh also noted, in optimistic words filled with foreboding for people of average or below-average skills, “For the most talented, imaginative and technically qualified people, the new industrial revolution will create huge opportunities that will turn out no less exciting than those that changed the world during the original industrial revolution of the late eighteenth century.”[5]

Advanced digital intelligence, based on expanding the power of the Jeopardy-winning Watson-type computer by a factor of several thousand or million times, could easily eliminate a great deal of the so-called “knowledge economy” work. Most mortgage approvals are already done by computer algorithms, and computers are better than most tax consultants at ferreting out the hidden assets of would-be tax avoiders. Research shows that computers can select the best short lists for job vacancies. But imagine how this applies to the so-called soft and human fields, such as clinical psychology, where studies have shown that computer programs can already outperform human analysts in terms of diagnosis. As two Stanford University psychiatry professors argue, “Computers and Internet-based programs have great potential to make psychological assessment and treatment more cost-effective. Computer-assisted therapy appears to be as effective as face-to -face treatment for treating anxiety disorders and depression. Internet support groups also may be effective and have advantages over face-to -face therapy.”[6]

Older readers will remember “Lucy,” the early mainframe computer program named after Charlie Brown’s nemesis, that asked and answered questions: “What seems to be bothering you? You’re sad? Why? Can you tell me about it?” It was fun, but now it seems to be a reality. Twenty years ago, society struggled to get people suffering with mental illness to visit a psychotherapist. Now, these patients are being directed, under clinical guidance, to put their mental well-being in the hands of a digital system.

One can only imagine how many low-level, repetitive government functions—and functionaries—could be replaced by well-designed computers. Look at Estonia, one of the world’s most advanced e-countries, if you want to see the electronic future of government. Reducing cost and improving efficiency and productivity are the main reasons for investing in new technologies, but remember that each innovation has the potential to eliminate many jobs, although theoretically each one could also create an unknown number of spin-off opportunities. Science fiction writers have pondered the future of artificial intelligence for generations—and now it is staring the world in the face.

No sectors will be left untouched. For more than a generation, urban parking lots provided a common point of entry into the North American workforce for tens of thousands of immigrants who were drawn to the minimal requirements and the ability to work without English-language skills. There were a hundred and thirty thousand such workers in the USA in 2014. The work was straightforward: collecting receipts, running them through a time clock, and providing change. Many of these jobs are at risk. In their place are a variety of machines—for coins, bills, and credit cards—that provide access to customer-managed parking lots that are monitored remotely by video camera. More advanced systems alert drivers to the number of vacant spots in the garage and can even indicate where the vacancies can be found. Innovative systems allow drivers to reserve spots while en route to their destination, and direct the driver to the garage and specific space. Many automated systems send a text to the consumer when the allotted time is over, allowing the individuals to add extra time over their smartphones. So, better service, more information, more efficiency, and improved safety—but with fewer workers.

Job Automation

Jobs where the likelihood of automation approaches 100 percent: Telemarketers, Title Examiners, Sewers, Mathematical Technicians, Insurance Underwriters, Watch Repairers, Cargo and Freight Agents, Tax Preparers, Photographic Process Workers, New Account Clerks, Library Technicians, Data Entry Keyers.

Jobs where the likelihood of automation approaches zero: Fire Fighters, Oral Surgeons, Healthcare Social Workers, Prosthetists, Audiologists, Mental-Health Social Workers, Emergency Management Directors, First-Line Supervisors, Mechanics, Recreational Therapists.[7]

High-Pay, High-Status Careers

Consider the other end of the income scale—the well-compensated, deeply scientific, and high-status medical professions. This work is intensely personal, involving direct contact between patient and physician (or nurse or paramedical professional). These fields, despite global concerns about high costs and expanding medical needs, seem impervious to job loss, particularly given the health care needs of the industrial world’s growing population of senior citizens. Medicine is also a profession with an intense appetite for innovation, ranging from nanomedicine (miniscule medical robots), personalized pharmaceuticals, remote surgery, implanted medical devices, highly specialized treatment techniques, and various other technical developments. These advances seem to be effective, as improvements in life expectancy attest.

But the scale, importance, and especially the cost of medical service is also a major incentive for labour-saving innovation. The most technologically optimistic specialists imagine a near future where smartphones and embedded technologies replace substantial portions of current evaluations and monitoring by medical professionals. High-technology solutions—contact lenses that alert patients via text messages of changes in blood sugar, digital tablets that provide remote and personalized assessments of various chronic diseases, embedded monitoring systems that alert both patients and their medical caregivers to changes in health indicators, nanotechnologies that attack diseases at the cellular level, sophisticated precision operating tools that allow complex surgeries at vast distances, and super-high -efficiency radiation systems that use synchrotron science to target radiation treatment at the smallest and least intrusive level possible­—have already revolutionized medical care in first-world countries. Helped by high-tech and corporate philanthropists such as Bill and Melinda Gates and Warren Buffett, companies have turned their attention to the developing world, looking for innovations that could address the health care needs of the “bottom billion,” a global effort that has the potential to use new technologies to bring about major improvements in the life prospects for the world’s poorest citizens.

All of this makes medical care one of the most dynamic and promising fields of technological innovation—but it less clear what this means for the physicians, nurses, and paraprofessionals in the field, particularly in the industrialized world. Of course, there are many reasons for caution. Massive investments in e-health, particularly focused on the management of health records, have produced mixed results, at best, and several spectacular failures. Far from saving money, these efforts produced huge contracts for consultants and failed to deliver on the promise of massive labour and wage savings. If the technology works, however—and the passage of time suggests that it will, although perhaps not as currently anticipated—there could be a sharp reduction in the number of physicians, nurses, and other health care providers—although not, at least in the United States, an improvement in the staggeringly inefficient management of the nation’s health insurance system.

The point of these examples is that an intense transformation is underway in the adult labour force in the present, and it will continue into the future. Researchers suggest that half of all of the jobs in the North American economy could be eliminated through technological change in less than twenty-five years. Half! Even if the figure is just futurist-babble, and the number is smaller, some changes are certainly coming, and even a 20- or 30-percent reduction will be catastrophic. Some of the remaining work will require high-end, science and technology-driven employees. These people will usually require advanced STEM (science, technology, engineering, and mathematical) skills, precisely the areas of study where North American students are at their worst and where the college and university system produces fewer graduates than the market requires. Some scenarios about future economic profiles foreshadow a world dominated even more dramatically by billionaires, with a small and wealthy tech-elite buttressed by global demand for their expertise, a large service sector that caters to the well-to -do, and alarmingly large groups of the unemployed and underemployed. While techno-enthusiasts claim that the technology-driven economy will both redefine work and create many new opportunities, the current trajectory of the “new economy” is far from promising for the majority of people who lack high-end skills. The American Bureau of Labor Statistics has made some interesting predictions on the future growth of STEM, as opposed to non-STEM, employment. Between 2000 and 2010, STEM growth increased 7.9 percent and non-STEM 2.6 percent. Between 2008 and 2018, these figures are projected to be 17 percent and 9.8 percent.

The creation of vast wealth in the digital sector has not been matched with a large and expanding workforce. The oft-cited example of Instagram—sold to Facebook for $1 billion at a time when it employed only twelve people—is emblematic of a fundamental disconnect between the prosperity of the elites and the reduced opportunities for the many. Even more dramatic is the case of Markus Frind, founder and for years the only employee of PlentyofFish (POF.com), an algorithm-based dating site. Frind sold his company in 2015 for $575 million, a pretty price for a firm with millions of dollars in annual revenue but only a tiny number of employees. The leading high-technology companies are small in terms of the total number of people who work for them. Some of the more dynamic sectors, such as animation, rely on a small, fluid workforce that struggles to cope with routine turnover and industry-wide instability. For those with the key technical skills—computer programmers, software engineers, software managers, and the like—the job market looks spectacular. Jobs are readily available. Salaries are high. And prospects, for now, look impressive. The field is not for everyone and certainly not for those with a generic college degree.

Companies compete for talent and offer handsome incentives to those with highly specialized skills, such as young professionals with knowledge of the semantic web (the “thinking” Internet). North American companies routinely cite labour shortages as a justification for hiring foreign workers to fill highly paid jobs. Indeed, international students are overrepresented in the STEM disciplines in colleges, particularly at the graduate level, and many use their expertise to move quickly into full-time employment and even permanent resident status in the USA or Canada. This creates some unique and creative solutions. The USA has been more reticent about allowing foreign workers into the country than Canada, frustrating American high-technology firms. Microsoft, eager to attract hundreds of workers for urgent projects, was blocked by American immigration rules. The company set up a satellite office in Vancouver, capitalized on Canada’s more liberal immigration regulations, and got the workforce it wanted, operating only a hundred and fifty miles from the Microsoft headquarters in Redmond, Washington.

Outsourcing Work and Forecasting the Future

But even in the IT sector, the present and the future of work are far from secure. For many American companies, it has been easier to move the work offshore. Starting in the late 1990s and following on the profitable lead established by outsourcing call-centre work, North American firms began shifting a lot of their high-technology work to Asia. Sun Computer Systems, once a leading American research powerhouse, currently has more than 90 percent of its high-technology workforce in Asia, with most of it in China. The Chinese firm Huawei, little known in North America, has a massive high-technology force—over a hundred and fifty thousand strong—and is a world leader in wireless technologies. Foxconn Technology in Taiwan, with over 1.5 million employees, is the world’s largest high-technology firm, a title that for much of the postwar period belonged to American firms.

This new reality highlights the need for a highly specialized workforce, but it also suggests that the Western economy will require many fewer workers than at present. With China, India, the Middle East, Turkey, and other countries churning out hundreds of thousands of highly motivated, well-trained, and eager young STEM professionals, it is by no means certain that the current demand for workers in these fields will hold. This is where things get really unnerving. The economy is shifting—and certain highly skilled workers will have the best opportunities in the workforce of the twenty-first century. Logic clearly suggests that young adults should head to the STEM disciplines where assured employment awaits. But will it? It is equally possible that competitor countries will emerge to displace leading North American firms. To the degree that there are more jobs, they may well be in Taiwan, China, and South Korea (where most of the digital economy is based) or in emerging economies in India, Turkey, or Brazil. Or not. The reality is that no one knows for sure. And it is upon precisely these uncertainties and ambiguities that young people are expected to chart their educational paths and career aspirations.

Here is the dilemma that faces governments, parents, and young people when it comes to making sense of the evolving work environment. Everyone has no doubt heard—many times—about all of the new jobs, professions, and opportunities that will be available for young people in the future. It is easy to recall these optimistic and even enticing views. Futurist gurus predict that young people will have four, five, six, or more careers in their adult lives, so fast-changing will economic realities be in the coming years. Gone, they say, are the lifelong company careers, offering steady career progress, solid benefits, and security through to retirement. If the life of the company man or woman is disappearing, worry not, the story goes, for well-trained, flexible, and educated individuals will be able to adapt to an exciting, dynamic, and upwardly mobile workforce that is full of opportunity and adventure.

CST Careers 2030, a thoughtful exploration of the future of work completed by a company that helps parents save money for their children’s college and university studies, provides an enticing view of what is in store. Old-economy jobs might be disappearing, but Careers 2030 paints a portrait of an economy moving, creatively and with dispatch, in exciting new directions. Consider some of these jobs of the future, according to CST: system tangilizer, integrated roofing systems designer, gamification designer, makeshift structure engineer, or robot counsellor. (Go to CST’s website,[8] listed in the endnotes, if you would like to find out what a “system tangilizer” or a “gamification designer” is.)

In fairness, the future of work is as unknowable today as it was for any earlier generation, so CST’s guess is as good as yours. Who in the 1930s could have fully imagined the world of work in the 1950s and 1960s? Similarly, the comfort and optimism of the 1960s was no foundation for the employment possibilities of the twenty-first century. Current career forecasts show an interesting mix of traditional and new jobs, a focus on the persistence of work in the personal-service fields, and some quirky possibilities in the world of high technology. They also suggest that a good deal of employment in the future will be based on a client-contractor, rather than employer-employee, model.

The End of the American Dream

But there are real problems with this view of the future of work. First, it turns out in fact that someone in 1930 could have guessed pretty accurately what the world of work would have been like in 2015, because, amazingly, 90 percent of people in the North American workforce are doing jobs that existed over a hundred years ago.[9] How is that for an employment world in rapid transition? Second, it’s elitist: the largest employment categories are not computer scientists and medical technologists, let alone neuroscientists or mining engineers. Rather, the largest employment categories are retail clerks, cashiers, office clerks, food preparation workers and servers, registered nurses, and customer service representatives. Overall, it’s a pretty traditional and unglamorous workforce, with the majority of workers doing low-skill, low-salary nineteenth- and twentieth-century work for the most part. There will be great, interesting, and lucrative jobs for some people in the future, but not for everyone, and not for all college graduates, either. It doesn’t matter how many graduates are produced by all of the world’s universities and colleges. Most of the jobs, even in the twenty-first century economy, will be basic, often menial, and with only a small percentage requiring highly specialized skills.

Unless technology really takes off, and unless companies produce waiter-robots, completely self-cleaning homes, digitally controlled hairdressing systems, self-driving trucks (whoops, those are on the way), total-technology fast-food restaurants, mechanized garbage collection, and nursing robots, there will continue to be a lot of very basic, service-oriented work in national and global economies. And it’s hard to imagine that those jobs will ever pay very well or return the cost of a college degree.

In the West, the combination of globalization and technological change has begun to seriously undercut one of the most valuable elements of post–World War II prosperity and social success. For more than fifty years, the economy produced well-paid, stable work for millions of people with moderate skills or expertise. These jobs—in auto plants, government offices, manufacturing operations, mines, forestry, processing plants, and the like—were often unionized, with excellent wages, benefits, and job security. Across North America, a stable and prosperous society emerged, based on middle-class opportunity and the stability of relatively low-skilled and reliable employment.

This was the magic of post–World War II America. Average people—high school graduates with reasonable work habits, but no particular entrepreneurial instincts or specialized skills—found that the economic order worked quite well for them and their families. The jobs were not necessarily personally fulfilling—few workers truly loved factory work for General Motors, the line in a Milwaukee sausage plant, or a regular shift in a Kraft food-processing operation. These were not the careers of the superstars and the exceptionally talented. But they provided decent opportunities for hundreds of thousands of people. Based on the nature of the late-twentieth -century North American economy, these industrial and white-collar workers could buy a house, provide for their families, and enjoy a comfortable life. This became the new normal—the realization of the American Dream, which offered a reasonable level of prosperity for millions of North Americans of average ability.

College graduates had it even better. The burgeoning middle class found a wealth of opportunities for those young people who completed their degrees. Nothing was assured, but on the whole most college graduates did well, entering middle management or the professions, or using their skills to launch one of the hundreds of thousands of new businesses and franchises that marked the expanding Western economy. For college graduates, this was the perfection of the American Dream, and the source of the belief that the Dream Factories had truly created personal opportunity and growth prospects.

Throughout the postwar years of economic expansion and prosperity, North America offered two major career paths for young people. Unskilled unionized work served a large portion of the workforce while college-educated graduates self-selected into largely white-collar employment and had a similarly great run through the 1960s and 1970s. Not everyone made it into one of these two paths. (The United States also had a third option—the military—that attracted thousands of young adults each year.) A considerable segment of labour was not unionized, notably coal mining, which persisted into this period. The unemployable struggled, as they always have done. The lesser-skilled young men and women found jobs in the growing low-end service sector, either using these positions as a launching pad into a life of work or hanging on to the lower rungs of the American career ladder.

But imagine if one changed the qualification from a college degree to a union card in the mid-1960s. The standard university data indicates that college degrees provide much more substantial earnings over the course of a career. Yet income data also show that unionized workers in key sectors, like the auto sector, also secured much higher wages over their adult lives than the North American average. In other words, getting the right union card, even in areas of relatively low skill, was just as much of a path to prosperity as a university degree. Politicians don’t say this much—even Hillary Clinton, a friend of trade unions, has no grand plan to increase their membership—even though the causal relationship between membership and high earnings was once just as strong as it was for a college education.

Unfortunately the union advantage—a critical part of the creation of a largely unskilled middle class in North America—has mostly disappeared. The serious contraction of the steel and auto sector, along with global competition and technological change, has undermined the strength of the unions. Membership crashed in the private sector in the 1990s, and the long-standing wage advantage quickly evaporated. What had once been a near guarantee of middle-class prosperity—a unionized job in an auto plant, steel mill, or manufacturing plant—eroded quickly. Within twenty years, the private-sector union card went from a path to a comfortable life into something of an anachronism. By the beginning of 2014, private-sector union membership in the United States had fallen to less than 7 percent.

There was an exception to this pattern. Members of public-sector unions went in the opposite direction, earning higher-than -average incomes, greater job security, superior benefits—whether or not the job was an unskilled security officer at an airport, a clerk in a government agency, or a unionized functionary in a Washington office. Nearly 37 percent of the public sector is unionized. The public-sector union card, it seems, is an equally important means of securing middle-class opportunities and incomes for a group of workers whose actual work skills and responsibilities do not necessarily warrant above-average pay.

Uncertainty for the North American Workforce

It is not clear how the average North American worker will flourish in the technology-enabled economy of the twenty-first century. Email has undermined postal work. E-commerce is replacing tens of thousands of retail workers. Computers can process applications and documentation faster and more accurately than humans. Robots replace factory and industrial plant operators. Advanced machinery can cut more trees, haul more coal, drill deeper wells, handle more parcels, and otherwise surpass the outcome, cost, and effectiveness of human-based processes. In the emerging economy, lower-paying jobs for the unskilled remain, but they are in hotels, restaurants, coffee shops, airports, car-rental operations, and the like. There are high-paying jobs—for a small number of workers—in the high-salary, high-energy, and technologically rich design, development, marketing, and related digital sectors. What is missing—what used to be the “guts” of the North American economy—is low-skilled, well-paid, and stable employment for people of average or even below-average ability and accomplishment.

The shift to a technology-enabled economy and the requirements for an up-skilled workforce has altered the fundamentals and created new challenges for young adults seeking to replicate the success of their parents and grandparents. The vast majority of the high-paying jobs and expansive career opportunities require advanced technological and scientific skills, high levels of motivation, curiosity, and inventiveness. Only a small portion of the student population is suited to positions of this type and is capable of meeting the educational and training needs of the advanced workforce. Furthermore, the college and university system is not well placed to respond to these twenty-first century realities. Finding a way forward for the average student and worker is one of the greatest challenges of the coming generation.

This is the cornerstone of the new American economy: excellent opportunities for those with the best and most relevant credentials, uncertain prospects for the generalists, and significant challenges for those without the basic skills needed in the high-tech era. Over the next twenty years current trends are likely to accelerate, with greater technological displacement of work, increased specialization, major shifts in the nature of employment, career preparation, and lifelong work. Many—but not all—of the best paid and most secure posts will go to college graduates, as they have in the past few decades. But if the best jobs do go to college grads, it doesn’t follow that all college graduates are assured of excellent opportunities, particularly if the colleges and universities continue to flood the employment market with hundreds of thousands of non-specialist graduates who are not properly prepared for a workforce that is already dramatically different than that of their parents and grandparents.

The nature of the evolving economy shows both halves of the Dream Factory reality. For those who select the right fields of study and have the right mix of motivation, intelligence, work ethic, and entre­preneurship colleges will continue to produce “dream” results. The new high-technology economy will require thousands of highly skilled and well-trained individuals—and the best schools and the best programs will deliver superb results for their graduates. Some areas of study will struggle—will accounting continue to lead to career success for graduates in the face of mass digitization?—while others will produce remarkable results. Watch for digital design and design generally to maintain their current trajectory. Colleges attract the best and brightest within contemporary society, including some students who are brilliant and have remarkable analytical, writing, and research skills. These graduates, who enter brilliant and leave brilliant, will make fine employees or entre­preneurs, as they have always done. Each year, the colleges will find recent graduates who have had great results after leaving university. The message will be that Dream Factories work.

But they do not work for everyone. If advocates of college expansion have their day—Clintonesque visions of universal post-secondary education abound in the modern world—there will be many more weak students attending university. Weak students become weak graduates, and weak graduates make poor employees. Moreover, poorly prepared and underskilled high school graduates rarely succeed in the math- and science-rich, technologically sophisticated fields, the ones that have real and sustained employment possibilities. The overproduction of graduates in prominent fields, such as law and business, reduces the career prospects and income levels of the whole sector. That the wage premium for college graduates has largely disappeared is a classic illustration of the basic operation of supply and demand. But in the emerging tech-driven twenty-first -century economy, these graduates will be even further removed from the employment mainstream.

A post-graduation experience of unemployment and underemployment is not the career trajectory touted by the college recruiting offices and post-secondary advocates preaching about the benefits of university degrees. The life of the average American, counting on a college degree to put him or her on a higher-income path, has shifted dramatically. So, too, has technology ravaged the employment and income prospects for unskilled industrial workers. The reality is that the twentieth century is gone, the twenty-first century is here, and the pace of technological change in the workforce is accelerating. Those institutions and individuals that understand the transitions and seek education and training accordingly have the potential to flourish in the modern economy. They will make their parents and colleges proud and will find eager employers. But the current college and university model is far from ideally suited to the new tech-based economy.

There is a brass ring in America, and the number of billionaires continues to grow. But the trajectory is less dramatic and far more personal than the standard American narrative has it. Hard work, sacrifice, saving, and risk-taking are the skills needed for financial success.