The next great industrial revolution is all about ‘Data Factories’

Forget full-time jobs. If you want to understand the future of the American economy, pay attention to workers like Rosemarie McKeon.

The San Francisco-based grandmother makes $7,000 a month on TaskRabbit, relying on the outsourcing app for 100 percent of her income. As one of the site’s top-rated workers, she does everything from house cleaning to database scrubbing.

Taking odd jobs may not sound all that remarkable in an economy where the unemployment rate is still 7.3 percent. But legendary venture capitalist Sir Michael Moritz of Sequoia Capital says McKeon, and others like her, represent something bigger.

At TechCrunch’s Disrupt conference this week, Moritz said the U.S. is in the midst of the next great industrial revolution. But, this time, the engines of growth are not factories and automotive plants, but what he calls “data factories” — companies like Google, Amazon, eBay, Airbnb and others that harness massive amounts of information from their users.

These companies use advances in computing power, storage and other technology to seamlessly connect billions of people. They’re also changing the nature of work by allowing freelancers to market their services to an increasingly large audience.

“This has never happened before,” Moritz said. “It’s changing the complexion of our entire lives, starting with the workplace.”

The examples are everywhere. Kindle authors, Uber drivers, YouTube stars, Etsy retailers, Airbnb hosts and eBay sellers use these apps and sites to cobble together an income.

But, as the workplace shifts from full-time labor to more individual careers, the broader economy could suffer. For one, tech giants that make up these “data factories” require far fewer workers than other employers. Google has 40,000 employees; Walmart has 2.2 million.

People unable to get hired by an employer thriving in the new economy may find themselves taking hourly jobs elsewhere.

“It means life is very tough for most everybody in America,” Moritz said. “It means, life is very tough if you’re poor. It means life is very tough if you’re middle class. You have to have the right education to work at a place” like Apple or Google.

About 30 percent of the U.S. workforce is currently self employed, Moritz says, a figure that could rise to 60 percent in the next 10 years. Those who lack the skills or entrepreneurial experience to create their own careers could struggle.

That may also force educators to adapt, and preach the virtues of entrepreneurship. Marco Zappacosta, the co-founder of online marketplace Thumbtack, says schools need to teach people how to market and sell their individual skills.

“It’s about understanding what your contributions can be, and what tools are out there to meet the people you have to meet,” he said.

(article by C.Cutter)


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