We have a chance to solve five great challenges: the world of work is in crisis, a sustainable future needs to be built, the conventional way we do things in our society is not sustainable, there are many people who want to do sustainability work, and investors want more opportunities to help build a sustainable future. By connecting up these challenges we can make The Great Pivot.
The world of work is in crisis. The majority of people working are not engaged at work. Meanwhile 37 million people aged 25-64 are not even in the work force. Outsourcing, automation, and the gig economy threaten the stability of a work world that is already teetering. Many people would like to help build a sustainable future because it’s meaningful work that gives their lives purpose.
Meanwhile the conventional way we do things in our society is not sustainable. Our energy system runs primarily on fossil fuels. Our transportation system is dominated by single-occupancy vehicles burning fossil fuels. We extract materials, process goods, then use products, and dispose of wastes in a linear flow. 40% of the food we grow and raise is thrown away. We are degrading forests, waterways, topsoil, and wildlife populations at a scale unparalleled in human history.
At the same time, we know what we need to do to turn this around. We know what advanced energy communities, smart mobility, a circular economy, reduced food waste, and restoring nature’s services look like. We have proofs of concept for solutions. At this point, we need to unleash the financial sector’s resources to replicate and scale the solutions. Investors want more options to build a sustainable future than the Social Responsible Investing options that invest money in similar baskets of Fortune 500 companies screened to remove a few key industries.
It’s time to free people from the anxiety of being made redundant and expendable in the current economy. There’s important work that needs to be done to build a sustainable future, passionate people who want to do meaningful work, and money that wants to be put to work. This is The Great Pivot.
World of work is in crisis
Recent workforce trends of outsourcing, job automation, the growing gig economy, and low levels of employee engagement contradict the rosy official statistic that unemployment is at a historically low level of 3.9%. If you dig into Bureau of Labor Statistics data, you will see that there are 37 million people between the ages of 25 and 64 who are not in the labor force (NILF). To be counted in the official U-3 unemployment category you need to have actively looked for work in the past 4 weeks. There are millions of people who want a job and have looked in the past 12 months but are discouraged. Most of these folks do not count as “unemployed.”
Granted, some people either choose not to work or cannot work. Some are full-time caregivers. Some are on disability. Millions of people work part-time but would like full-time work with benefits. A portion of the 37 million NILF would like to work full time. The US has a huge potential labor force who for various reasons are not recognized in the official unemployment rate.
Some people are unemployed because their jobs were sent overseas. As business leaders sought cheaper labor, they offered people they were laying off a severance package under the condition that they would train their replacement before they left. Outsourcing created a public backlash against U.S. companies that sent jobs overseas and some employers started trying to bring jobs back. However, with automation trends, some manufacturers who sent 1,000 jobs to another country, found that when they brought the work back to the US they only needed 10 workers. Industry 4.0 describes the process of replacing people working in manufacturing with automation and data exchange.
Automation also threatens the livelihood of the 4.2 million Americans who drive for a living. These workers are rightly concerned about the future of their jobs. Self-driving trucks, shuttles, buses, and taxis threaten to be a massive job killer.
In fact, any job doing predictable, physical work runs the risk of being automated. A McKinsey study looked at work activities that were more or less susceptible to automation.
The study found that predictable physical work, data processing, and data collection were highly susceptible to automation. A 2017 McKinsey report predicts that 5% of jobs could eventually be fully automated and 60% of occupations could see roughly 1/3 of their tasks taken over by robots.
On top of automation fears, workers are anxious about the growing gig economy. Presently 36% of all workers piece together a living with a few different part-time gigs. The upside of gig work is the flexibility. One downside is the insecurity of not receiving benefits such as health insurance or a retirement plan through an employer.
Low levels of employee engagement compound the workforce crisis. Gallup polls workers on a regular basis for their thoughts on workforce engagement. Consistently over the past 10 years, between 30-32% of survey respondents report being engaged at work. They are involved in, enthusiastic about and committed to their work and workplace. That means that 68-70% of employees are not engaged or disengaged at work. Clearly this presents an enormous opportunity for improvement.
Sustainability work that needs to be done
While many people struggle with fears about being left behind and frustration with work that does not engage them, there is important work that needs to be done to build a sustainable future. We need to speed up our efforts to create a society where humans live in balance with the environment that supports us. We need clean local energy, smart mobility, a circular economy, reduced food waste, and healthy natural systems.
When we think of sustainability work and green jobs, we often think of solar installation jobs. Indeed, this is part of it. There has been massive growth in the solar industry and it is poised to continue growing. Solar currently employs twice as many people as the coal industry, five times as many jobs as nuclear, and an equal number of jobs as natural gas. But there are so many other jobs needed to build a sustainable future.
Advanced Energy Communities
We need advanced energy communities. This means retrofitting buildings for energy efficiency and renewable energy in order that buildings use as much energy as they generate over a year: zero net energy. AECs seek to maximize local renewables, demand response, Solar Emergency Microgrids, and electric vehicle charging infrastructure (EVCI).
Our transportation system needs an upgrade. Instead of everyone owning their own vehicle that burns fossil fuels, we need to build a robust interconnected network of alternative transportation options so people can move around quickly and easily. Vehicles are expensive. In California, people spend $8-9,000/year on car payments, gas, maintenance, repairs, insurance, and registration. Someone without a car payment spends $4-5,000/year to own a vehicle.
When we need to travel within our region, we should be able to pull out our smartphone, type in the destination address and an app that does multi-modal trip planning and payment will figure out the fastest way to get there. There are several startups working on Mobility as a Service apps. Having a healthy mix of alternative transportation options that work together seamlessly will require society to invest more in alternative transportation options.
There is also quite a bit of work needed to build a circular economy. By circular economy we mean:
“an alternative to a traditional linear economy (make, use, dispose) in which we keep resources in use for as long as possible, extract the maximum value from them whilst in use, then recover and regenerate products and materials at the end of each service life.” – Waste and Resources Action Programme, UK
Interesting projects that nudge us away from a conventional linear economy are all around. We just need to replicate and scale them. Consider the tools we buy. Instead of every household buying the same construction, landscaping and woodworking tools that sit unused most of the time in the garage, each community should have a tool lending library. Keep in mind that people need a few basic tools like a hammer, screwdriver, and power drill handy. But it’s a waste to buy a tile saw and demolition hammer if you only use them once in a great while.
The City of Berkeley and 50 other communities around the US have tool lending libraries where residents can check out tools for construction, landscaping and woodworking projects for free. Late fees fund staff who check out and maintain the tools.
Another example of the circular economy is in Lane County, Oregon. The St. Vincent de Paul thrift store near the University of Oregon, hired a fashion designer Mitra Chester to upcycle donations. Mitra cuts sleeves off flannel shirts and hoodie sweatshirts and sews the flannel sleeves onto the hoodie bodies. The result has been enormously popular. Due to creative efforts like this, the store’s daily sales shot up from $500/day to $1,100/day which more than covered her salary.
Clearly we could be doing more to divert materials that still have useful life from going into landfills. The towns of Portola Valley and Palo Alto, CA, require homeowners who want to demolish and replace their home to first have an appraiser calculate the value of salvageable materials in the home. This process often results in the homeowner realizing they can sell or donate wooden flooring, solid core doors, kitchen cabinets, banisters, mantlepieces, and even the 2x4 framing in the walls instead of throwing them away.
For those materials we currently separate out for recycling, we must develop regional recycling markets. 90% of recyclables collected in California are shipped to Asia for recycling. Over the past few years, China has been rejecting loads of recyclables as too contaminated. This is partly a function of the fact that China now wants to be seen as an economic leader, not the recipient of America’s garbage. In the face of China’s rejection of American recyclables, we could create recycling jobs here in the US to recycle materials into new products. Economic development folks in California’s Central Valley would love to develop more recycling jobs like Ecologic in Madera, CA. Ecologic manufactures new laundry detergent packaging out of recycled paper. There is a plastic inner bladder to hold the liquid but it uses far less material than a typical plastic laundry detergent bottle. Having more recycling businesses regionally would move us closer to a circular economy.
Reduce Food Waste
Speaking of waste, the US throws away 40% of all the food we grow and raise. This waste happens throughout the supply chain from farm to fork.
Consider lettuce grown in the fields of Salinas. Field workers make split second decisions about which heads of lettuce to pick. They’ve been observed to leave one in five lettuce heads in the field. Field workers place lettuce directly in boxes and load them on tractor trailers that drive to distribution centers (DC). At the DC, staff crack open a few boxes for inspection. If there are too many insect holes or brown leaves the DC might reject the whole tractor trailer load. If the truck driver doesn’t know where the nearest food bank is, then the whole load might be thrown away or composted. Once the lettuce makes its way to the grocery store, the produce manager keeps extra produce in back to make sure the shelves always have abundant displays. The value of the grocery store’s additional produce sales more than offsets the disposal cost of wasted produce stored in the back. Finally, there is food waste at homes. In fact, from farm to fork, this is where the largest amount of food waste happens. Residents throw away 25% of the food they buy.
Just like there’s food waste at every stage of the supply chain, there are also opportunities to create jobs to reduce food waste at every stage of the supply chain. Farmers could use help selling the 20% of the produce they cannot sell for aesthetic reasons. Ugly produce distributor Imperfect Produce sells carrots with two legs, bent cucumbers and undersized apples for 30-50% less than the retail price of “perfect” produce.
There’s also a business opportunity to divert surplus prepared food from the trash after catered events. The non-profit Replate works in several major cities in the US. Caterers who have at least 10 trays of surplus prepared food can go onto Replate’s app and request a pick-up. For $40, a paid driver will pick up surplus food and deliver it to a homeless shelter. While many food rescue organizations rely on volunteers, organizations that charge for “reverse catering” pick-up are able to pay drivers. This creates jobs and ensures reliable and timely service. These are just a few examples of non-profits we could replicate and scale to reduce food waste if there were more funding.
Restoring Nature’s Services
The area that deserves an order of magnitude more resources is restoring natural systems. Important work needs to be done to restore healthy forests, restore healthy waterways, rebuild topsoil, sequester carbon, and restore wildlife habitat. Many natural systems provide important services for people like cleaning water, controlling erosion of topsoil, buffering against storms, and cleaning our air. If nature did not provide these services, humans would spend more money and resources to recreate these services. Human activity has degraded nature’s ability to function and we need to restore natural systems to the point that they can regenerate themselves. Doing so would be less expensive than recreating these services from scratch.
Anyone travelling up in the Sierra Nevada in California over the past few years has noticed an overwhelming number of dead trees. In California, 130 million dead trees sit vulnerable to a lightning strike that could ignite the next wildfire. Wildfires have become increasingly expensive to fight as the size and ferocity of the blazes has increased. In fact, fighting fires has stretched the US Forest Service budget to the breaking point. In 1995, the USFS spent 16% of their budget on fire fighting. Fire fighting now consumes over 50% and the “fire borrowing” comes at the expense of important restoration work. In order to restore healthy forests, the USFS needs more budget for research, planning, and forest technicians. Forest technicians refer to the people on the ground who do the hands-on work to thin dead trees, remove the biomass on the forest floor that fuels wildfires, conduct erosion control, plant seedlings, and remove some roads while building others.
Many of the nation’s major waterways suffer from nutrient and sediment runoff that create dead zones and compromise the ecosystem’s health. Part of what clouds river deltas around the nation is the topsoil running off agricultural fields and construction sites. The US is losing topsoil at a rate 10 times faster than it is created. We must reverse this slow-motion disaster. We know how to rebuild topsoil through carbon farming. Doing so would have the added benefit of sequestering carbon and reversing climate change. Devoting more resources to hire more engineers, scientists, contractors, and volunteer coordinators would allow non-profits and government agencies to restore the nation’s waterways faster.
The last and most heartbreaking environmental trend that we could turn around with more resources involves wildlife. Since 1970, Earth has lost 58% of its vertebrates and 81% of freshwater animals. This extinction rate is 1,000 faster than at any time in human history. According to the World Wildlife Fund’s Living Planet Report 2016, the greatest threats to wildlife include habitat loss or degradation, overexploitation, invasive species and diseases, climate change, and pollution, in that order.
Wildlife need three things in order to thrive: food, shelter, and access to a second breeding population. This is why habitat loss poses such a threat. Humans can help wildlife numbers bounce back in several ways. We can reconnect fragmented habitat areas by creating wildlife corridors. Wildlife overpasses and underpasses provide critical connectivity between habitat areas. Several Western states have been devoting resources to building wildlife crossings over and under highways. We also need to continue surveys of terrestrial and aquatic specie populations so we know where to focus future conservation efforts. These projects provide a sample of the kind of meaningful work we as a society could be prioritizing. Viscerally I think we all understand how important restoring natural systems and wildlife populations is to our own health and well-being.
There is so much important work that needs to be done to build advanced energy communities, smart mobility, a circular economy, reduced food waste, and healthy natural systems. Each area contains many different types of jobs in each of the major job functions: management, accounting, business development, communications, engineering, human resources, information technology, legal, marketing, operations, research, sales, and support.
People want meaningful work
I have met so many people who want to do sustainability work. Some are recent graduates, some are mid-career and want to make a change, and some are just retiring but still have energy and passion to make a difference.
Hannah is just about to graduate from University of Califorrnia San Diego with a degree in Environmental Science. She would would like to do sustainability work. Paula has been a Senior Biochemist for a pharmaceutical company for the past 11 years. She would like to move into sustainability work. Steve has been doing technical writing for software companies and marketing. He is 65 and wants to spread the word on the wonders of electric vehicles because he is concerned about climate change.
There seem to be many more people who want to do meaningful work than there are jobs openings to do this work. The challenge remains to find ways to fund the important sustainability work that needs to happen and create more meaningful sustainability jobs.
Investing in sustainability work
If we could unleash the finance sector, we could solve our sustainability challenges in short order. Just a fraction of total assets currently under management could build the sustainable future we need for humans to live in balance with the environment that supports us. Consider that there are 18,000 investment firms worldwide that manage $16 trillion in assets. These firms invest $500 billion/year. Putting these assets to work would allow us to scale our impact.
Where do we start? Consider the river of money that currently flows to companies engaged in unsustainable activities. Most of us regularly fund the linear, extractive, non-renewable economy without really wanting to when we pay our bills. Every time a household or a business pays an energy bill, pays a garbage bill, makes a vehicle payment, or buys gasoline, we perpetuate the portion of our economy that is unsustainable. These are all variable costs that we could divert to building a more sustainable future.
As a society we could invest in sustainable energy, smart mobility, lean manufacturing, and sustainable food systems. For those who don’t have the extra funding to invest, we could allow the financial sector to finance these investments and send our monthly payments to a financier instead of the energy companies, garbage companies, companies that make internal combustion engine vehicles, and oil companies. We are powerful to disrupt the linear, extractive and non-renewable economy. Where we choose to spend our dollars sends a signal to businesses and could be used to nudge them to evolve into more sustainable entities.
Some of the sustainability work outlined earlier will not result in monthly variable cost savings. Some of the work just needs to be subsidized. We should be willing as a society to pay for it because it’s important. Restoring healthy forests, healthy waterways, topsoil and wildlife habitat are a few examples. Government has a critically important role to play in this area.
Our capitalist system does many things well. It allocates resources efficiently in many cases and keeps prices down by encouraging competition. One failing of the capitalist system is the practice of creating negative externalities in which costs are borne by others. One of government’s most important roles is help correct for negative externalities. Government can play an important role by levying negative externality fees and using proceeds to fix the problems caused and create a new, more sustainable system.
We already have externality fees in place. Bottle bill deposits, plastic bag fees, and Cap & Trade funding are examples of successful systems in place. Government could expand the use of externality fees to create the jobs that would build smart mobility systems, create a circular economy, reduce food waste and restore nature’s services.
New industries and new livelihoods that make us whole
A recent headline from Tesla’s CEO gets at the crux of the problem. The headline read “Humans are still pretending that fossil fuels have no probability of a bad outcome.” We can’t continue to pretend that the conventional way we do things in our society is not undermining life support systems on this planet.
Does anyone remember the British Petroleum Gulf oil spill in 2010? Many of us watched live footage of the underwater camera that showed oil spilling out of the broken well head for months. This was the largest oil spill to date. BP ended up spending $63 billion (billion with a “b”) on emergency response, cleanup that was largely ineffective, and settlements. Wouldn’t it be great if we could take resources of that size and instead use them proactively to build the sustainable future we need?
We have an opportunity to do something about the five siloed problems we face.
1) A crisis in the world of work causing us anxiety about outsourcing, automation and the gig economy
2) There is so much sustainability work that needs to be done
3) The conventional way we run our energy, transportation, manufacturing, and food systems is not sustainable
4) There are many people who would love to do sustainability work
5) A portion of the financial sector would like to have more options to help build a sustainable future
Let’s turn these siloes on their sides and turn them into pipelines for each other. We have the talent and resources.
The sustainable future needs us to make it happen. It does not yet exist. We are the instruments through which it becomes manifest. And, lucky for us, the process of manifesting this future might just heal us and make us whole.