By: Heero Yuy
Is the above structure stable? This question can be answered in terms of equilibrium and not stability because it is in a state of unstable equilibrium as pictured below:
There are three (3) ways that someone can have a skewed perception on a subject matter:
- Ignorance of the problem at hand and how to correctly state it
- Making incorrect assumptions
- Utilizing incorrect perconceived notions and stereotypes
Skewness #1 was stated above when the problem wasn’t about stability or instability but the different classifications of equilibrium. The stack of rocks in the first picture is in a state of unstable equilibrium. The man sitting on the ice is in a state of stable equilibrium on a unstable surface (ice breaks, man falls in, man dies of hypothermia).
Skewness #2 Would be to make the assessment that all rock structures that resemble the diagram above and the first picture of the rocks to be in a state of unstable equilibrium. This is oversimplification because some of these rock structures might be glued together or bound by wire to resemble this state of unstable equilibrium. Without further assessment, one cannot draw the conclusion that any repeat of the above likeness is automatically unstable.
Skewness #3 For someone who hasn’t ever seen an unstable equilibrium, the above rock stack would be infeasible or appear as some form of magic trick. Those individuals who’ve never seen something new would utilize their own past experiences of stacking rocks themselves or seeing others, perhaps trying to create this unstable structure, failing at this and learned this endeavor to be fruitless. By their own admission, they know this to be ‘impossible’ so therefore anyone else who attempts them or they themselves attempting in the future will be met with failure. Perception of a successful attempt is outside their scope of understanding.
How this Applies to the Job Market
People incorrectly perceive stability in the job place with equilibrium. An efficient capital market takes no prisoners and leaves people behind who aren’t as competitive or hungry as their competitors. Therefore, the job market and the people in it are in a constant state of unstable equilibrium.
Companies comprise of people who work for the company who sell products or services. People are expendable and new people can be brought in to replenish the depleted workforce. The moment the product or service is useless to the market place and the company fails to prepare or pivot would spell doom for the company and all the people in it. Company and the workers in it are both expendable because other companies and workers can take their place.
A job can be of divided into the following four categories:
|high work, high pay||low work, high pay|
|high work, low pay||low work, low pay|
High work = Lots of work, Low the opposite
High pay = $$$$$, Low the opposite
Everyone wants the “low work, high pay” so that job is over subscribed (Lazy and entitled). Not many want to work a lot so “high work, high pay” is not as attractive and certainly no one wants to work a lot and get paid very little in “high work, low pay.” Finally, most people wouldn’t mind low pay for low responsibilities at work (Lazy and satisfied) which makes this category the second most coveted and over subscribed.
Low and High work jobs are equally at risk for automation irrespective of the resulting pay. “Low work, low pay” type jobs are a drag on HR resources and benefit packages. Since they are the most plentiful, they would be the first ones to go as the “high work, low pay” yields a better marginal gain for hour paid. Obviously, “high work, high pay” type jobs are typically too crucial to completely cut out, such as sales type roles, and the company would suffer financially if they replaced these jobs without much consideration. The next obvious category to dissect is “low work, high pay” as these are not as abundant but the largest saddle sore of the organization.
From the company’s standpoint, the most “stable” jobs are the most sought after and the ones that will be cut first! Are these then stable or unstable equilibriums for people to coast in what they perceive to be a stable job?
In any free capital market, those who bring the highest marginal yield are the most valuable members. Typically, these are classified as “high work” employees irrespective of their pay structure.
Since this is the case then your best bet is to work your butt off to escape the guillotine of automation while providing the company the highest yield per hour for your time at their office.
An incorrect understanding of the job market, free capital markets, and the utility of its workers can have serious consequences. Markets don’t function based on how people want them to work but how they actually work. Backtesting present job market opportunities based on previous market conditions for job seeking without actually seeing if there has been any changes in all of the aforementioned markets is catastrophic. The game is always changing, it has to in order to survive, and any misstep can cause irreversible consequences. Without proper education on how this game works and staying current with all markets, any investment strategies applied for yielding alpha (good job) would be met with failure.
Stable jobs do exist. They are called expendable overhead. Either way, working for a company or yourself requires a ton of work to stay ahead of the competition.
Welcome to Capitalism!