Technology-Enabled Disruption: Implications for Business, Labor Markets and Monetary Policy
The Federal Reserve Banks of Dallas, Richmond and Atlanta hosted the Technology-Enabled Disruption conference on May 22–23 in Dallas. The conference focused on technology implications for business, labor markets, education and monetary policy. Participants included, economists, business leaders, central bankers, educators and others.
Recap: Takeaways from the conference
Wednesday, May 22 | |
8:00 a.m. | Registration and Continental Breakfast |
9:05 a.m. | Welcome Mark A. Wynne, Federal Reserve Bank of Dallas |
9:10 a.m. | Opening Remarks Raphael Bostic, Federal Reserve Bank of Atlanta Robert S. Kaplan, Federal Reserve Bank of Dallas |
9:15 a.m. | Session I: The Disruption Challenge Facing Business Moderator: Robert S. Kaplan Greg Armstrong, Plains All American Pipeline LP Presentation Craig Boyan, H.E. Butt Grocery Co. Brant A. Ring, BNSF Railway Co. |
10:30 a.m. | Break |
10:45 a.m. | Session II: Defining Disruption: The View from Academia Chair: David E. Altig, Federal Reserve Bank of Atlanta Richard G. Baraniuk, Rice University Presentation Joel Mokyr, Northwestern University Presentation Willy Shih, Harvard University Presentation |
Noon | Lunch & Keynote Introduction: Roberto Coronado, Federal Reserve Bank of Dallas Moderator: Robert S. Kaplan A Conversation with Agustín Carstens, Bank for International Settlements |
1:30 p.m. | Session III: How Emerging Technologies Create Disruption Chair: Sylvain Leduc, Federal Reserve Bank of San Francisco Erica Deadman, JPMorgan Chase Institute Presentation Zorina Khan, Bowdoin College Presentation Susan Lund, McKinsey & Co. Presentation |
2:45 p.m. | Break |
3:00 p.m. | Session IV: Roundtable on the Implications of Technology-Enabled Disruption for Workforce Development Moderator: Raphael Bostic Carine M. Feyten, Texas Woman’s University Presentation William Serrata, El Paso Community College Presentation |
4:15 p.m. | Break |
4:30 p.m. | Session V: Implications of Disruption for Labor Markets Chair: Marc P. Giannoni, Federal Reserve Bank of Dallas Katharine G. Abraham, University of Maryland Presentation Ekkehard Ernst, International Labor Organization Presentation Henry Siu, University of British Columbia Presentation |
5:45 p.m. | Reception |
6:30 p.m. | Dinner & Keynote Introduction: Mine K. Yücel, Federal Reserve Bank of Dallas Moderator: Mark A. Wynne A Conversation with Craig Hall, HALL Group |
8:00 p.m. | Adjourn for the day |
Thursday, May 23 | |
8:00 a.m. | Registration and Breakfast |
8:45 a.m. | The Use of Data in Industry: A View from the Front Lines Introduction: Pia Orrenius, Federal Reserve Bank of Dallas Keynote: Patrick Bajari, Amazon |
9:15 a.m. | Session VI: Disruption and the Broader Economy Chair: Kartik Athreya, Federal Reserve Bank of Richmond Nir Jaimovich, University of Zurich Presentation Chad Syverson, University of Chicago Presentation Will Wang, Microsoft Research Presentation |
10:30 a.m. | Break |
10:45 a.m. | Session VII: The Workforce Ecosystem: Local and Regional Solutions Chair: Alfreda B. Norman, Federal Reserve Bank of Dallas Stuart Andreason, Federal Reserve Bank of Atlanta Sandy Dochen, IBM Presentation Mark Flanagan, Dallas County Promise–The Commit Partnership Presentation Rob Grunewald, Federal Reserve Bank of Minneapolis Presentation |
12:15 p.m. |
Lunch Session VIII: Policymaker Roundtable Moderator: Rana Foroohar, Financial Times Thomas I. Barkin, Federal Reserve Bank of Richmond Raphael Bostic Mary C. Daly, Federal Reserve Bank of San Francisco Robert S. Kaplan |
1:30 p.m. | Conference adjourns |
This conference is designed to provide a better understanding of the phenomenon of technology-enabled disruption and explore its implications for the broader economy—in particular, labor markets and the workforce.
Technology-enabled disruption means that workers are increasingly being replaced by technology. It also means that existing business models are being supplanted by new models, often technology-enabled, that bring more efficiency to the sale or distribution of goods and services. As part of this phenomenon, consumers are increasingly able to use technology to shop for goods and services at lower prices with greater convenience—which has the impact of reducing the pricing power of businesses. This reduced pricing power, in turn, causes businesses to further intensify their focus on creating greater operational efficiencies. These trends appear to be accelerating.
It is likely that disruption is becoming a greater factor in the economic outcomes of workers. Increasingly, workers with lower levels of educational attainment are seeing their jobs restructured or eliminated. Unless they have sufficient math and literacy skills, or are retrained, these workers may see their productivity and incomes decline as a result of disruption. Thus, disruption may help explain the muted wage gains and overall labor productivity growth we have seen in the U.S. as well as in other advanced economies during much of the recovery from the global financial crisis.
Technology-enabled disruption’s impact on the workforce is likely not susceptible to monetary policy—it requires structural reforms. The reforms could include improving early-childhood literacy and overall college readiness in order to increase the percentage of students who graduate from college in six years or less (a share now estimated at 59 percent in the U.S.). The reforms could also include stepped-up efforts to increase middle-skills training in cities across the U.S. in order to increase employment, close the skills gap (not enough workers to fill skilled jobs) and raise worker productivity.
It is also likely that disruption is a factor behind some business decisions made by companies that are facing one or more disruptive competitors. These companies may be more cautious about making capacity-expansion decisions and investing in major capital projects.
To deal with disruptive changes and lack of pricing power, many companies are seeking greater economies of scale in order to maintain or improve profit margins. This may help explain the record merger-and-acquisition activity globally over the past few years.
For More Information
Please contact Sharon Wallace at sharon.wallace@dal.frb.org.