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part of the whole.”
Simon’s predictions, made in 1960, run
counter to predictions made by business analysts
in the 1990s. Simon’s emphasis on managers
goes against the precepts of re-engineering,
in which information technology
eliminates layers of managers. His qualifi ed
emphasis on salespeople runs counter to predictions
that e-commerce will dramatically
reduce their numbers.
Were Simon’s predictions accurate? Consider
fi rst the 1969 occupational structure for
Selling will account for a larger
fraction of total employment.”
©najlah feanny/corbis
68 The Milken Institute Review
adult workers. The U.S. Census Bureau classifi
es workers into roughly 400 occupational
titles – everything from funeral directors
to administrators in education and related
fi elds. The chart below groups the detailed
occupational titles into seven broad categories
arrayed from left to right in order of
increasing average earnings.
Professional occupations include teachers,
ministers, doctors, engineers and other
white-collar jobs typically requiring college
or postcollege education. Blue-collar workers
include skilled craftsmen, assembly line
workers, day laborers and similar workers,
most of whom work in industrial settings and
have not completed college. Service workers
include janitors, cafeteria servers and waiters,
police offi cers, firefi ghters, child-care workers
and others who deal with people face to face;
many of these jobs do not require a college
degree (Police offi cers are now an exception in
many jurisdictions, but were not so in 1969).
The variety of occupations in each category
blurs the implications of the category’s
average earnings. Service workers on average
earn less than blue-collar workers, but the
highest paid service workers – police offi cers
and fi refi ghters – earn more than many bluecollar
workers. Nonetheless, the chart gives a
reasonable overview of the occupational
structure.
The chart on page 69 shows how these
occupational groupings changed in relative
size between 1969 and 1999, a period in
which computers of all kinds permeated the
economy. (We chose 1999 as the end point
of our comparison in order to compare the
peaks of two business cycles.)
• Service workers grew modestly from 11.6
percent of all workers in 1969 to 13.9 percent
in 1999.
• Blue-collar workers and administrativesupport
workers both declined. Together,
these two groups employed 56 percent of all
adult workers in 1969, falling to 39 percent of
adult workers in 1999.
• Sales-related occupations ranging from
McDonald’s order takers to stockbrokers grew
from 8 percent to 12 percent of all adults.
• Technicians increased from 4.2 percent to
5.4 percent of all adult workers.
• Professional occupations – engineers,
teachers, scientists, lawyers – increased from
10 percent to 13 percent.
40
35
30
25
20
15
10
5
0
PERCENT OF EMPLOYED ADULTS
Service
Workers
Blue-Collar
Workers
Administrative-
Support Workers
Sales-Related
Occupations
Technicians Professional
Occupations
Managers and
Administrators
THE ADULT OCCUPATIONAL DISTRIBUTION, 1969
source: Authors’ tabulations of data from the March 1970 Current Population Survey.
Fourth Quarter 2004 69
• Managers and administrators increased
from 8 to 14 percent.
This hollowing out of the occupational
structure is broadly consistent with Simon’s
predictions, including his expectation of more
face-to-face interaction. With one exception,
it is also consistent with Drucker’s view that
growth would be in jobs requiring more education.
The exception is the modest growth of
service workers at the bottom of the pay distribution.
To see why trends in service workers are
diffi cult to predict, consider the idea that
computers are best at routine jobs. In casual
conversation, a security guard has a routine
job: he or she walks the same beat every night
looking for suspicious activity. But from a
cognitive perspective, a security guard’s job
is exceedingly complex. The core of the job –
identifying suspicious activity – begins with
the perception of large quantities of visual
and aural information. This information
must be processed using pattern recognition
that requires substantial contextual knowledge.
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