Friday, September 12, 2014

The Next Wave and The Educators' Dilemma

The writing is on the wall: The next 10 years will not be like the last 10 years for jobs and work in the emerging markets.

In an insightful article in Foreign Affairs, Andrew McAfee, Erik Brynjolfsson and Michael Spence argue that the current convergence of globalisation and automation is fundamentally reshaping the world economy and altering the patterns created by the last wave of IT and globalisation. With the advent of World Wide Web, cheap intercontinental communication and expansion of global trade, there was a wave of 'outsourcing' which benefitted the low-cost countries and created a new middle class. However, with intelligent machines and an altered dynamic of globalisation after the Great Recession, this pattern is altering. Labour is no longer the biggest cost for a manufacturer, for example: Transportation is. So, manufacturing is coming where the consumption is (iPhones in Texas) and even China, despite its great success in manufacturing, has been quietly losing manufacturing jobs. Call Centre workers are at risk because the calling bots could replace them easily, all kinds of transcription work that paid handsomely in developing countries are at risk from the increasingly capable speech-to-text software, and even the every day grunt work done by Indian programmers in software factories are being increasingly done by computers. Joshua Cooper Ramo may see in this a reversal of globalisation (see here) but what's really happening is a global expansion of consumption with localisation of production. This, the authors argue, creates a 'power law economy', creating a tiny 'power elite' who controls the information resources that run this economy, and take a disproportionate share of its rewards.

But this is a digression of sorts, because what I want to talk about is how this should affect the education agenda in the developing countries. In a sense, the policy-makers in these countries are sleepwalking into this future: They are looking into a future where there is more of the same thing as we had for last 10 years. The talk is to create more educated workers so that the factories can remain competitive and BPO industries don't get strangled by the talent bottleneck. That these industries are going to shrink and that lots of the current workers will have to scramble for the few jobs that would be available, thereby shutting out the new entrants, is not an argument they are willing to take on board. Employers may be aware of this shift at the highest levels - India's top BPO companies are moving near their customers - but the executives on the ground are caught in here-and-now and aren't seeing any shift in the market. Indeed, it's not them who sees any shift in the market anyway, until they get run over.

Education policy is necessarily an exercise in the art of the long view. However, policy-making in education in most of the developing countries is only reactive - it is only catching up on the skills problem after the horse has really bolted - and forward thinking isn't the name of the game by any means. The fact that such convergence may mean a different kind of education - a shift of emphasis from process to creative work, a realignment of prosperity away from companies earning hard currency to companies serving domestic customers, a different kind of innovation focusing on bottom-of-the-pyramid customer rather than process efficiency - is still nowhere in discussion. It is also ignored that this oncoming convergence means, in a large part, the breaking of the false dichotomy between Higher and Vocational Education, and breaking of the regulatory walls that we build around education.

This is ignored not just because it threatens vested interests, which it does, but also because there is n clear alternative model. There is a lot of claim of education disruption, but one has to accept that if something does not really violate 'conventional wisdom', it is not really disruptive. And, given that the current wave of 'disruption' is being led by private equity money, i.e., with financial backing of some of the most privileged and conservative people in the planet, it is almost impossible for them to be disruptive. What is happening instead is a simple land grab - the public educators are losing out because of the public to private shift in education and new, more 'business efficient' models of education are emerging - but none of these models are truly disruptive because they are not creating new 'uses' of education. Rather, the claims of disruption were primarily based on pulling non-consumers to consumers of education, which is, as we have seen in the US, really the expansion of consumer debt, but not much about education.

This mechanics - which makes education even more static and conservative - along with the fundamental change of jobs and work create what I shall call, borrowing from Clayton Christensen's work, the 'Educators' Dilemma'. Indeed, Clayton Christensen Institute is at the forefront of the discussion about change in education, though, as I observed above, within a limited context of land grab rather than innovation. What's needed is an honest global conversation about how education is going to look like, and find new 'uses' of education.

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