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cations without long design delays. Then, too,
CATIA and other software innovations facilitated
the outsourcing of blue-collar manufacturing
work. Once CATIA produced the
digital machine tool settings, the machine
tools themselves could be located anywhere
since Boeing knew the parts would fi t when
brought to a common assembly point.
Boeing located production in Italy, the
United Kingdom, Japan and other countries,
in part to attract foreign customers and in
part to reduce production costs. In retailing,
a similar conquering of geography occurs as
fi rms like Amazon.com and Land’s End use
single Web sites to reach widely dispersed
customers and use computerized shipping to
deliver orders in acceptably short times.
None of these goals is new. Fifty years ago,
Boeing wanted to bring high-quality planes to
market as soon as possible and to tailor specifi
cations to customers’ preferences. What was
new – what computers had changed – was the
cost. Fifty years ago, bringing aircraft to market
sooner without compromising quality
would have involved paying vast amounts of
overtime. The adoption of computer-based
design tools and computer-driven production
tools dramatically lowered the cost of
achieving these goals.
The Boeing-CATIA story illustrates a fi nal
computer-supported strategy: the creation of
new, information-intensive products, including
CATIA itself. CATIA, CDs, cell phones,
DVDs, global positioning devices, the modern
echocardiograph machine, the Eurex
Trading network, complex fi nancial derivatives,
and the PalmPilot are all successful
products made possible by computers.
getty images
64 The Milken Institute Review
why jobs change
As the Boeing-CATIA example suggests, computers
change work through a three-step
process. The fi rst step occurred when Boeing
purchased CATIA to pursue competitive
strategies that were impractical without computers.
To take advantage of CATIA’s capabilities,
Boeing next had to reorganize work,
using computers to substitute for humans
in carrying out some tasks and to complement
humans in carrying out others. In the
fi nal step, the reorganization of work changed
both Boeing’s job mix and the skills needed
to do many jobs. Engineers now had to create
designs on computer screens rather than
drafting boards. The labor to build a full-scale
mock-up was no longer needed and the labor
spent hand-fi tting parts was sharply reduced.
Some jobs that had been previously located in
the United States were moved offshore.
The same three-step process characterizes
almost every new application of computers.
Firms adopt computers to gain a particular
competitive advantage. Realizing
computers’ potential requires reorganizing
work. As computers proliferate
in the workplace, the jobs they create,
destroy and change are the by-product
of this work reorganization. Since computers
are present in a large and growing
number of American workplaces,
they are catalyzing dramatic change in
the nature of work.
four ways to
think about work
When we ask how computers are
changing work, we have four specifi cs
in mind.
Employment. With all the prophecies
that computers would create mass
unemployment, why didn’t it happen?
The economy’s mix of jobs. As computers
have substituted for humans in carrying
out some tasks and complemented
humans in tackling others, what kinds of jobs
have grown in importance, and what kinds of
jobs have declined?
Wages. What are the wage trends for different
kinds of workers, and what do these
trends tell us the about the changing content
of work?
Worker skills. Which skills are of rising
importance in the economy and which skills
face diminishing demand? The answer to this
question involves changes in the economy’s
mix of jobs but also the changing nature of
work within jobs.
Employment
The economy is still struggling to extricate
itself from the post-bubble recession, but the
current unemployment rate is nothing like
the mass unemployment expressed in the
automation scares of the 1960s. In any event,
getty images
Fourth Quarter 2004 65
by focusing on the unemployment rate, we
will miss the economy’s strong job-creation
performance as computer use soared.
In the mid-1960s, mainframe computers
were a commercial reality, and specialpurpose
computers – for example, computers
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