Understand your Industries of the Future

This essay is included in the new book from the Parliamentary Network on the World Bank and IMF: The Future of Work for the People we Serve. To sign up for the launch of the book as well as a conference on the future of work and inequality, click here!

Alec Ross, Former advisor to Secretary Hillary Clinton on Innovation, and author of Industries of the Future. Maryland, US 

One of the great stories of the last 25 years of globalisation is the nearly one billion people who have moved from poverty to the working and middle classes in India and China. But if you were to index on a continent-by-continent basis where there could be the highest increase in per capita GDPs in the years to come, I think it would be in sub-Saharan Africa.  

This is because connectivity has taken once very isolated communities and people disconnected from global markets, and connected them. Now that we have the benefit of a handful of years of connectivity, we are starting to see what I believe is the beginning of the development of genius that has been buried for quite a long time. I’ve seen some fantastic examples of entrepreneurship, of talent development that’s taking place there that makes me really very optimistic about a part of the world that there hadn’t been optimism for decades. 

Take Andela. It was founded by a 31-year-old with a thesis: [that] if you put the most talented people in places with a very high population density – like Nairobi, Kenya and Lagos, Nigeria – through the most rigorous possible boot camp – six weeks of absolute coding misery – that they would come out of it as a Google-quality programmer. They’ve tested this thesis and it’s basically proven true, 

What this means is that the 17-year-old who might have been making $6/7,000 a year, suddenly has a market value of $200,000 and doesn’t have to get on a plane and fly to London or San Francisco, but can actually work from Lagos. Using digital markets, he can suddenly monetise the value of that human capital. This isn’t just a cute story, but a simple illustration of the truth that talent is universally distributed, but opportunity is not.  

So what are some of the issues policymakers need to think through over the next thirty years?  

If we could fast-forward 30 years from now, certain things that we think of as scarce goods will be abundant goods. Things like bandwidth, for example, will be everywhere. And we probably won’t be driving cars in 30 years. Synthetic biology will be another area where over the next 10-30 years, there may be enormous change in what we eat, or from where we get transplanted organs. 

But when we think about labour substitution – artificial intelligence automating work that was once merely manual and routine, or work that is cognitive and non-routine, there is no evidence that artificial intelligence will replace creatives. In fact, there will be a new premium placed on people with creative skills – design skills, artistic skills and other such things. 

When we think about what skills and attributes are necessary for people to be the leaders of tomorrow’s industries, people tend to obsess about STEM – science, technology, engineering and mathematics. I think that’s reasonable, but actually the leaders of tomorrow’s industries are going to be people who are able to combine some measure of a technical education with skills and attributes that are traditionally domiciled with the arts and humanities. So the blending of arts, culture and design with science and technology is going to produce great businesses and great leaders of the future. 

There will be some industry trends that are especially important.  

The world’s last trillion-dollar industry was created out of computer code. The world’s next trillion-dollar industry is going to be created out of genetic code. We are now about 15 years past the mapping of the human genome. Mapping the first human genome cost $2.7 billion; now it costs about $2,000. We’re finally, after a decade or more of hope, at the point where we can begin to develop personally. 

Second, whereas land was the raw material of the agricultural age, and iron the raw material of the industrial age, data is the raw material of the information age. He who owned the land, controlled the land during the agricultural age, and had the economic power. He who owned the factories and controlled access to the natural resources during the industrial age had the economic power. He or she who owns the data, controls the data, or can interpret the data in today and tomorrow’s economy, are going to be those that build the most powerful businesses of the future. 

What data has done, in essence, is reform business models that are rooted in part in persuasion and decision making. So we go to Google to get access to information that we want more quickly, or in the business I was in we would use data to help persuade people to vote for somebody. If you’re in advertising, you use data to figure out how to more convincingly sell somebody something. And what the Pacific Ocean-worth of data that we’re creating is going to do next is to drive reform of industries that we think of not necessarily in digital-first terms – like agriculture.  

So what do policymakers need to worry about?  

The first thing is focusing in earnest on the working class – the most difficult-to-reach populations – and ruthlessly reorienting the delivery of education, within the communities where we know the most vulnerable people are, toward those skill sets that we know will be more durable, in a world increasingly shaped by artificial intelligence and robotics. 

The second thing is to look afresh at emigration policies. I think it is increasingly the case that – especially with people benefiting from connectivity – entrepreneurs can come from anywhere. And if part of what you’re trying to do is make, say, London a global hub for the industries of the future, these aren’t necessarily going to just be people who go to Eton and Oxford. They’re going to be people who come from all over the globe. 

Third, I do think that too much time is spent obsessing about a small number of American companies, and I think that time would be much better spent figuring out, from a policymaker’s standpoint, what can be done to enable the creation of competitors to these companies? 

So from a policymaker’s standpoint I would reorient thinking away from, ‘How do we deal with these big companies?’, and more towards, ‘How do we help support the development of some of our own companies?’. 

In particular, I would think about the data assets that government has, and think about how government can enable technology in the public good; looking at its reservoir of data and figuring out how to open it up, make it machine-readable, and allow entrepreneurs to figure out how to use it in the public interest. 

Finally, in a world of more and more super-wealthy and more and more tensions within the working class, we have to make significant investments in raising and strengthening the safety net. The economic burden for this, will have to be shared by the new plutocracy. And I think that most of the people from the new plutocracy would not actually disagree with that.