Global Megatrends and Industry Division N
This industry division is about people, specifically the provision of people to other businesses. Whether these people undertake support activities, such as cleaning, or perform in operational roles on a temporary basis, this industry reflects the ebb and flow of the broader economy. For centuries business owners and senior staff have been hiring labour on a temporary basis. From day rates for London laborers in the 1600s, to casual employment in wharves across Europe in the 1800s. From temporary surges in staffing at call centres during the 1980s, to the pervasiveness of today’s gig economy.
While the need for administrative and support services has been ever-present, there have been changes in this industry – labour practices and technology are but two examples. This article explores what the future may look like for this industry. Viewed with the two most influential global megatrends in mind, climate change and computerisation, what follows is a futurist’s take on the trajectory of next ten years or so. It canvasses aspects of several of the industry’s subdivisions as well as the prospects for those who either work or operate a business within it.
About the global megatrend of climate change
It has been well established for a number of years that the average global temperature has been rising. The year 2000 was about 0.5oC higher than the average of the previous 140 years worth of recorded temperatures (1880 to 2020). Further, 2020 was almost 1.0oC above the long-term average. On current projections a further rise of anywhere between 0.5oC and 1.5oC is expected over the next 20 to 30 years.
With this in mind, the urban heat island (UHI) effect will have a greater influence upon economies around the world. UHI is a phenomena of cities. It is where the built-up environment absorbs and radiates more energy than its surrounding natural environment. As the global average temperature rises, the implication of this the UHI effect is that the average temperature of cities will rise even higher.
With an extra 2.5 billion people, on current trends, settling in urban areas over the next 30 years there is the distinct possibility that the UHI effect will counteract any of this trend’s socio-economic improvements. From interruption to sleep, and thus labour productivity, from UHI-induced warmer-than-usual nights to reduced hours of work due to health risks from exposure to higher daytime temperatures. The accelerating UHI effect looms as a significant factor in dampening economic activity over the coming years.
About the global megatrend of computerisation
As much as we have witnessed the increasing power of computers over the decades, the computer screen, through which we visually experience this improvement, has had a similar trajectory.
The original computer screens, properly called a monitor because the early computer engineers and scientists needed some way to monitor the output of a computer, were simply arrays of flashing lights. These patterns of flashing lights needed specialists to interpret their meaning. Later, in the 1960s, oscilloscopes (used in science labs and in radar installations) began to be used.
While TV adapters and similar approaches were used a decade later, it wasn’t until the dawn of the personal computer revolution in the 1980s that dedicated video display standards appeared. The original 1987 VGA (video graphics array) standard used 16 colours at a resolution of 640 x 480 pixels. That is, 4 bits of data could be processed for each of the 307,200 pixels.
Compare this with a current display standard – UHD 4k. This standard has a resolution of 3840 x 2160 pixels, with 16.8 million colours available for each of these 8.2 million pixels. Considering that this UD 4k standard is in use in television, in movies, and in computer games, the processing capabilities of both the devices that we see the moving images on, as well as the computers that are used to create and edit them, are quite impressive.
Not only is the increased power of computers used to process increasing amounts of data, quicker, but equally they are capable of manipulating and displaying progressively richer moving images.
The impact of these two influences
What of the impact of climate change megatrend upon the administrative and support services industry?
One obvious impact is upon the types of temporary labour that employment agencies will be called on to deliver more of. As storms become heavier and flooding becomes more of a frequent occurrence, the ability of these agencies to deliver waste and clean-up labour and associated logistics managers will be challenged. Similarly too with the various physical trades required for any repair and reconstruction activity.
The delivery of government-level services may also be constrained. With staffing generally set to cater for service delivery at business as usual levels of activity, there may well be limitations on any service delivery expansion in times of crisis. This would be due to the pool of available temporary specialist workers being either restricted are overrun.
The recent experiences with the pandemic and the calls upon specialist health staff speak to this particular constraint.
Associated with these calls for temporary labour are the strains on household, business and government budgets. With government generally being the funder of emergency support, multiple significant weather events are likely to see their finances stretched.
The pandemic also taught us about the living conditions of the people who are providing vital services.
Consider extreme urban heat island scenarios. From where will the employment agencies recruit their labour? From the very same locales that are being affected by this heating phenomena. Whether extra labour for supermarket retail, drivers for ambulances and perhaps fire services, even education and child care – because of the economics of this labour force, this surge workforce will be living and working in the same conditions of the people they are supplementing.
There are two sub-sectors of this industry division that are also of interest. Pest control and travel services. Regarding pest control, climate change is having an impact upon the locations where fauna and flora are found. Depending upon the species, life-supporting habitat may be shifting away from the equator, changing the distance between it and waterways and coastal areas, and even moving higher on mountains. Couple this with ever increasing urban boundaries, the situation is ripe for different pests to surface. Thus challenging local knowledge and the efficacy of long-standing pest control measures. New and untried forms of pest control, in this situation, may have a range of unintended side effects.
Travel services is the other sub-sector. Along with understanding any shifts in destination weather patterns, knowledge of long-term meteorological and socioeconomic changes on the places that people are travelling to will be paramount. For example, long-standing traditions, food and beverage may not longer be available. Likewise insurance claims due to cancellations and other weather related events may rise.
Human nature might cause travel patterns to shift in two diametrically opposed ways. One scenario might see stiff increases in visitation, the “see it while you can” mentality. The other scenario is a collapse in the number of people travelling to the tourist site due to the collective acceptance of travel being a net negative, particularly on the environment.
Tourism by virtual reality may offset this collapse scenario
Secondly, to the other megatrend influencing Industry Division N – increasing computerisation.
In a general sense, a good portion of the activities that people perform across the administrative and support services industry can be described as non-routine manual. This includes occupations such as cleaners, housekeepers, and gardeners. Consider the tasks that domestic and commercial cleaners undertake. Although they are manual, and the steps within each task can be repetitive, the work is non-routine in the sense that what a factory worker does is routine. For example, cleaning an office chair requires repeated wiping tasks but the size and location of the chair vis-à-vis the desk and surrounding office furniture is far from being consistently predictable.
While the prospect of digital technology replacing this type of labour seems to be not feasible from a cost and quality perspective, computerisation will continue to make inroads in other ways. For example, sensors to monitor the quality of the office clean, and algorithms to select the right cleaners will both change the dynamic of this set of activities.
However, increasing computerisation will continue to impact the set of more professional occupations. For example, human resource managers, advertisers and marketers, and accountants. Because aspects of these roles are routine – consider financial reports for accountants and procedural steps for those in human resources – and because digital technology is well suited to performing routine tasks, the repetitive and operational activities these professionals undertake will be increasingly computerised.
Likewise with advances in artificial intelligence. Activities calling for professional judgements may well be made more often by silicon than by a human.
Then there is the call centre. From AI-powered chat-bots efficiently and effectively providing high quality customer service to synthetic AI voices providing human-quality outbound services. The falling cost of computing capital will, in time, shift the balance away from call centres that have significant staffing levels.
Finally, to the set of business that supply labour specifically to perform outsourced administrative tasks. These tasks are generally operational, repetitive and highly predictable in nature. Such tasks can be easily performed by digital technology.
In summary, as it is with other industry divisions, we can see that the influence of the global megatrends of climate change and computerisation will increasingly be felt in the administrative and support services industry. Climate change will primarily be felt in terms constraints on the supply of surge workforces. Computerisation will improve the efficiency of the industry over time as it becomes feasible to replace humans undertaking the more complex tasks in an occupation. Important to note is that because this industry division supports other industry divisions, their responses to these two megatrends will in turn have an impact upon administration and support services.
What are your prospects
From the preceding, and from a career perspective, there are several observations that can be made:
If you are more the “get it done” type: you’ll find yourself working in environmentally tougher situations. If you have specialist skills you’ll be in high demand
If you are more the “thinking” type: as artificial intelligence develops and becomes more capable you’ll need to develop skills such as decision interpretation and explanation that leverage this functionality
If you are more the “creative” type: you’ll need to look for opportunities to add unique value to straightforward operational tasks
If you are more the “helper” type: you’ll be needed to support lower level staff prepare for either difficult environmental conditions or the loss of tasks to automation
If you are more the “leader” type: you’ll need to be very comfortable with leading people in an industry that will become more disrupted by weather events and with competitors that are becoming more efficient and responsive due to computerised and automated operations
If you are more the “structure” type: you’ll be faced with not only changing regulations, but also changing market dynamics and unforeseen operating conditions
Overall, from a career perspective, in the years ahead you’ll need to comfortable with an industry that is facing increasing pressure as a result of these two global megatrends. These challenges, in the form of continual squeezing over time, will be caused by the changes in the sectors that this industry serves.
And from a business perspective, like with other industries, when it comes to responding to climate change it is all about mitigation (ie. shifting focus to reduce risk) and resilience (ie. fortification to handle risk). Secondly, with respect to computerisation, its all about automation and the spread of AI. So, for those operating within the administrative and support services industry, likely business prospects are along the following lines:
Mitigation: shift to lower risk locales, invest in automated machinery and equipment
Resilience: increase depth of contingency workforce, improve the capability of the workforce
Automation: add value to operational processes, serve niche non-routine manual tasks
Artificial Intelligence: training, interpreting and supporting the AI that businesses use
Overall, and quite obviously, for businesses there are both risks to be aware of and opportunities to exploit in the change that is happening.
The administrative and support services industry, like all other sectors of any economy, is being affected by the global megatrends of climate change and computerisation. Not only will these phenomena continue to change the industry, but because this industry primarily exists to support other industries – what happens elsewhere will cause it to change. However, operational effectiveness will remain this sectors dominant competitive factor.
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