Smart Cities Part 2

I finally finished The Smartest Places on Earth by Antoine van Agtmal. My overall impression is that in areas that used to have a large manufacturing base, they are starting to revive by moving up the skills ladder: medical, biotechnology, materials science, technology, etc; hence the name smart cities. The revival is also heavily predicated on collaboration between universities, local government, at least one large company, and startups. So it looks like the skill sets require, at minimum, a college degree but more likely some form of higher level degree such as Masters or Ph.D. because of all of the research activities being done. So, the jobs are not something that the average American manufacturing worker can hop into.

“By 2020, 65 percent of all American jobs will require some postsecondary-school education.” The Smartest Places on Earth by Antoine van Agtmal, p 165, ebook.

But only roughly 30% of Americans manage to obtain a degree. I’m not sure how accurate that prediction is because that is such a huge gap. And even for those who already has a degree, they may not have the right kind of degree because the types of jobs being discussed have generally been STEM type jobs.

In the book, towards the end, there is some discussion about education. Here it becomes interesting because despite all of the discussion of the different types of high tech jobs in the new brainbelt, which to my mind requires advance degrees, the author says the value of the typical 4 year college is not what it used to be: students come out heavily in debt and still don’t have the requisite skills needed in the new working world. He goes on to lament on how today’s students don’t appreciate manufacturing jobs and so don’t train for those jobs.

Hmmm, I wonder why? Could it be because of all of those years of offshoring jobs to countries where labor costs are dramatically cheaper? Could that have anything to do with it?

Anyway, the author is highly enthused about community colleges rather than the 4 year colleges. He gives some examples of community colleges working with businesses to develop tailored programs in manufacturing processes and tools to get students ready to work in these new kinds of companies. The only disconnect in my mind is that these new manufacturing plants are supposed to be highly automated, so I would think these plants would have less need for trained workers. Maybe a few to tend to the machines and maybe program them, but those robots should be pretty much self-sufficient. So I’m a little confused here.

In Europe, particularly in Germany, companies are more involved in training programs such as work-study or vocational training where either the companies provide the training or the funding for such training. In the US, for the last two or three decades, companies have cut funding for training because management, or maybe the shareholders, questioned the value of such training. This short sighted thinking has led to a situation where companies now complain that they can’t find qualified people, especially those with skills for today’s technology. Meanwhile, over in Germany and the rest of Europe, they continued doing some kind of training or apprenticeship to keep the flow of skilled personnel going. In Germany, they have a partnership of labor and management that runs the company, so the relationship is more collegial. Although the author doesn’t say it outright, I think he feels US companies should get back in the game of some kind of employee training or collaboration with community colleges to get the skilled employees they need.

Another kind of “training” or “education” is basic research: doing basic research to learn more about the workings of basic science. This is a stretch on education but I wanted to bring in the topic of research because companies (nor the US government) no longer do much basic research but instead focus all of their research energy on applied research because this is where the potential for money comes in. This is the outcome of the shareholder mantra where everything is about the money. However, we really need to do big basic research because this is where fundamental, innovative and disruptive knowledge comes in and moves the needle. And companies no longer do that.

Finally, to close this post (there is more in the book but I’m limiting the post to education and skills as the theme), here is a telling quote:

“European policy makers still fear, however, that any changes to the welfare state will expose Europe to the “American disease”, whose symptoms are enormous income inequality and increasing percentage of the population living below the poverty line.” Ibid., p 184.

That’s the shareholder philosophy for you.