What Is a Company to Do When It Experiences Technology-Driven Job Dislocations?
Silicon Valley Tech company senior managers wake up every morning wondering what labor-saving devices or tools they can design, build, and deploy to digitize work. I remember like it was yesterday in 1987 in Silicon Valley when many of the telecommunications sector companies realized that their various “Voice Mail” and commercial-grade telephone answering machines had put tens of thousands of telephone operators, secretaries, and receptionists out of work across the country over only a 5-6 month period of time (the length of time it took to sell-in their products, install them, and turn them on at a customer site.)
My then large law firm realized within an hour the morning that we turned on our voice mail tool for the first time that we had just eliminated the need for over 50 receptionists assigned to the many floors of our many office buildings around the country. Receptionists were there to ostensibly “guard the doors” to the law firm and meet and greet occasional clients and vendors. Their primary task, however, we learned that morning, was to answer the phones and route inbound telephone calls to the proper employee while they waited to greet the occasional visitors and vendors. Within a few months, we realized that “guarding the doors” was not enough reason to leave the door guards in place any longer, once stripped of their phone answering duties (which occupied 95% of their time we discovered that morning).
As a result, we then caused all visitors to enter through a single first-floor “Visitor Center” in each of our buildings so we could then seal the reception doors on each floor, of each office tower, remove the grand reception desks, guest furniture, and capture back thousands and thousands of square feet of office space to then be put to other more productive uses (like storing paper files…then replaced not long thereafter with offices following technological advances in digital storage tools…now soon to be abandoned and returned to the landlords with the advent of remote work).
And important to the dislocation discussion, my 200 law partners and I decided in 1987/1988 that we had a duty of loyalty to our employee receptionists who were out of work through no fault of their own. So, we offered to retrain all who wished to stay into other administrative jobs (back-office jobs, researchers (the ones now being dislocated by the new AI work tools), and paralegals (now also about to be further reduced in number, if not to zero, or near zero)). And we worked with those former receptionists who wished to leave the firm by cushioning the otherwise economic impact on them by keeping them employed for a few more months while they looked for other types of work.
I, for one, felt strongly that it was our duty as the owners of the law firm to own the responsibility for all employees we dislocated through no fault of their own. Most of my law partners thought the responsibility for their unemployment did not rest only with the state government unemployment insurance systems and employment centers. And, of course, unemployment insurance in every state was a very poor “stop-gap” to cushion the economic impact of a job loss.
I have advocated ever since that day in 1987 when we plugged in the VMX tool that companies create contingency dislocation fund pools against the day the advance of technology renders some unfortunate otherwise well-performing employee “redundant” and “unnecessary.” That message alone is likely more difficult to swallow than even the loss of pay. We are pack animals. Irrelevance is a harsh reality, let alone the thought of starting over, starting something new, and something foreign. Gut-wrenching. My heartfelt concern goes out to my many recruiter friends.
My then-client Hewlett-Packard, led by David Packard (co-founder of Hewlett-Packard), was a thought leader within the United States as to Human Resources policies and created many of the foundation HR policies and practices we take for granted today. They were revolutionary in their opening days. Mr. Packard, too, was troubled by technology dislocations as he saw a “roller coaster” ride in the 1970s, 1980s, and early 1990s of “boom and bust” cycles in the semiconductor industry (then the essence of “Silicon” Valley before software emerged from the mist to create the Internet Boom which then very quickly diversified the number of industries in the Valley which today we collectively call “Tech Companies”).
While it does not fare well these days in “employee” vs “independent contractor” law, Mr. Packard developed the concept of “doughnut” staffing in response to advancing technology changes impacting the workforce. This allowed HP to hire “mirror image” independent contractors with skills parallel to those of full-time regular HP “core employees.” When technology changed or demand for semiconductors subsided, HP could adjust to changing staffing needs to protect its “core employees” by laying off first the independent contractors and thus protecting from job loss “core” HP employees.
