The Missing Map from Silicon Valley to Main Street

Bob O'Donnell / February 7th, 2017

Regardless of where you sit on the political spectrum, the maelstrom created by the last US presidential election uncovered a painful reality for the tech industry: a striking gap between it and much of mainstream America.

It’s not that Americans of all socioeconomic levels aren’t using the output of the tech industry. From smartphones to social media and PCs to online shopping, US citizens are, of course, voracious consumers of all things tech.

The problem is a serious lack of empathy and understanding from people who work within the tech industry to those outside their rarified milieu. To its credit, the tech industry has created enormous amounts of wealth and many high-paying jobs. Very few of those jobs, however, are relevant or available to a large swath of the US population. While I haven’t seen any official breakdowns, I’m not aware of many middle income jobs (according to US Census statistics, the average US family income in 2015 was $55,755) in the tech industry. Heck, interns at big tech companies often get paid more than that.

Not surprisingly, that kind of income disparity is bound to create some resentment. Yes, on the one hand, the significantly higher salaries often found in tech jobs do make the goal of working in tech an attractive one for many who aspire to break into the field. But not everyone can (nor wants to) work in tech.

A functioning society, of course, requires people to work across a range of jobs and at a range of income levels. But, it does seem rather disconcerting that an industry that is responsible for driving so much growth across the economy, and that houses the most well-known and well-respected brands in the world, does so little to employ people at mainstream income levels. For all of its focus on social justice and other progressive concerns, the tech industry displays a rather shocking lack of interest in economic inclusivity, which is arguably at the very heart of a just society.

For all of its focus on social justice and other progressive concerns, the tech industry displays a rather shocking lack of interest in economic inclusivity, which is arguably at the very heart of a just society.”

Of course, fixing the problem isn’t easy. But it does seem like there are a few basic ideas that could help and a lot more “thinking different” that might be worth a try. For one thing, the fact that the tech industry notoriously outsources (or subcontracts) nearly every lower and middle-income job to another firm (all in the name of cost-cutting) needs to be re-examined. From bus drivers, to janitorial and security staff to, yes, manufacturing jobs, it’s high time to start making people who do work for a company, employees of that company, with all the rights and benefits that entails. Yes, it could negatively impact the bottom line (though, in the big scheme of things, not by very much), but it would be a tremendously positive step for many. All it takes is some fiscal stamina and a bit of guts.

In addition, the whole mindset of gig-based companies (such as Uber) needs to be reconsidered. Maybe the original intentions for generating a bit of extra income were good, but when millions of people start trying to build their lives around pay-for-hire work, it’s time to start making them the middle-income employees they’ve earned the right to be.

It’s also time to start thinking about packaging and selling technology-driven products in entirely new ways. There might be ways to start building entire new sub-economies around, for example, helping farmers grow their crops more efficiently through the use of sensors and other IoT-based technologies. In addition, building products or services that allow the creation of small businesses, such as a tech franchise, which could help other local small businesses with their tech devices and software. For example, someone who could help local bakers, restaurants, florists or shoe repair shops to run their businesses a bit more efficiently, but provides “door-to-door” service.

Part of the problem is that the tech industry has become so obsessed with only offering the latest, most feature-rich products and services through high-income jobs that they have lost sight of the fact that some people only need very simple “older” tech that could be delivered in a more modest manner through comparatively lower-paying jobs.

Rather than planning for a societal collapse, it’s time to start mapping out a more positive, productive future that links Silicon Valley to Main Street in a useful, meaningful way.

Bob O'Donnell

Bob O’Donnell is the president and chief analyst of TECHnalysis Research, LLC a technology consulting and market research firm that provides strategic consulting and market research services to the technology industry and professional financial community. You can follow him on Twitter @bobodtech.
  • obarthelemy

    Two issues then: a) class and blue collar vs white collar and b) designing products for the hoi poloi. Agreed, there are big issues with both.

    I’m in the generation that grew up alongside computers (my first was a Sinclair ZX 81), so I’m… graced… with older relatives with no computer culture and no affinity with computers, even in my own generation, anyone not working a desk job. Trying to help those out gives a whole different outlook on UI/UX. 1st, that the UI has to be shown/discoverable (buttons even menus > gestures), 2nd that it has to be immediately understandable (text > icons), 3rd that objects get used (durability and battery > specs and shiny). I wouldn’t say “some people only need very simple “older” tech that could be delivered in a more modest manner through comparatively lower-paying jobs”, actually I find that phrase condescending. The reverse of that coin is that many people don’t want stuff that costs as much as a car, breaks on the first fall, has no evident UI, and is mostly used for porn (“In 2013, Google research showed that porn sites get more traffic than Netflix, Amazon, and Twitter combined (source). In the UK, as of 2013, porn websites were being accessed more than all social networks combined, and more than all shopping websites combined (source).”), oh yeah, and most of the rest is FB et al.). How can one be blasé about that ? ;-p

    As for the class question, IT is but one small fragment of it, and probably not the worst offender compared to finance, luxury… It’s a enabler for the new gig economy though, which gives it a special role in that rollback of workers’ rights. I really think that’s a political issue though. PACs, gerrymandering, voter exclusion…

    • Bob O’Donnell

      Thanks for the comments. Certainly didn’t intend to be condescending, by the way, just trying to throw out a few ideas. Admittedly, it’s a very challenging situation but I just felt it was time to bring up what can be a very uncomfortable subject.

  • klahanas

    I think the author raises a very important problem to be solved. It’s always the complimentary problem to invention. What to do with displaced workers?

    In the US, it raises the cultural divide as well. When it’s not cool to being a geek, you end up with the James Deans and Kardashians running the country. When the reward system is such that shallow, transient, spinny, and flashy, supersedes integrity, substance, and wisdom, you get what you get.

    Education has consequences, and so do elections. Both fall squarely on the character of society.

    I’ve touched on this before. “Tech” as colloquially spoken about here (maybe a narrow sighted analysts term) is not just Silicon Valley and after a very large drop, biotech. It’s anything having to do with technology, which in the end is applied science or it’s engineering.

    Silicon Valley style tech is kind of unique because it shortens paths in workflows. You are either a master, or you’re nothing. This is mostly because, outside of the fab, it’s all digital. It’s all information. You don’t need the paperboy, or even the newspaper.

    Biotech actually widens these paths, pharmaceuticals at large, widen them even more. Autos? Anything manufacturing? You actually have to make a physical thing. Then you have to deliver it, store it, accommodate it’s use, etc.

    Silicon Valley style tech is crucial, and it’s rightfully growing, albeit not at the same pace. So until Ray Kurzweil manages to digitize his consciousness, he will need to eat, move, be medicated, etc. we organic lifeforms will still need “Tech” in it’s broadest sense, not just the kind from the bookmakers who grease Wall Street’s wheels. ‘Cause, you know, that’s where the money is.

  • davebarnes

    “There might be ways… helping farmers grow their crops more efficiently through the use of sensors and other IoT-based technologies.”
    You need to get out more.
    Most farms are over 800 acres. And, getting larger.
    Most farmers already use these types of tools.

    • Bob O’Donnell

      I’m sure that many are, but the few conversations I’ve had with some companies looking at this suggest the numbers of farmers using this technology still have a lot of room to grow.

    • Frank D.

      Quite a bit of variety in U.S. agriculture. In the Midwest, when people think of agriculture (if they ever think of it), they’re thinking of the 85 million acres of corn in the nation’s midsection, the so-called Corn Belt. This agriculture is already highly mechanized and increasingly automated.

      Then there’s California agriculture, source of maybe half the nation’s produce. This type of ag is being forced to automate largely due to labor shortages, a chronic recurring problem that dates back at least a century (see Bracero program of 1942 during WWII labor shortages). Historically and still today much of this is stoop labor. Another way of describing it is immigrant labor. Anyone with much sense gets out as soon as they can find a better job.

      Automation generally results in efficiencies and better jobs, but also many fewer jobs. Not sure what Bob is thinking here with sensors and IoT. That’s already well underway, by a number of very large corporations.

      Much of this article could apply to other U.S. industries as well. Many companies outsource jobs they don’t want to hire for, universities do it, government agencies do it. Not sure if I understand throwing off on the tech industry. Maybe because they’re so successful at making money?

      The problem for “mainstream America” (whatever that is) is largely a mismatch of skills as automation reduces the number of jobs that don’t require a college education. The hottest job in America right now is for data scientists, with a median salary of $110K. But these jobs require at least one college degree in a STEM discipline.

    • obarthelemy

      Need to get out further away ^^

      Outside the US and a few other countries and rather specific crops, farming is either subsistence or small commercial. Many Euro countries are trying to keep their small farms/vineyards for example.

  • As a non-US citizen living on the other side of the Pacific, and viewing my Twitter stream of mostly tech enthusiasts, it’s pretty clear that the tech will move in the opposite direction of what you propose. Making fun of Trump and his supporters isn’t going to help. If anything, it’s going to further widen the political divide in the country.

    Seriously, I don’t see anything short of a war with a country that poses a real threat to the US that would reunite it (and you’ll need a draft, otherwise only the poorer people will enlist). I’m left hoping that Trump doesn’t notice this because there’s a significant chance that the war will be close to where I live.

    • Space Gorilla

      I wouldn’t worry too much about Trump. The short term rollbacks in progress will be a tragedy, yes, but as Martin Luther King, Jr. paraphrased (from an 1800s quote): “The arc of the moral universe is long, but it bends toward justice.” Things will get better, and Trump’s primary motivation (just my opinion) is to loot America as much as he can, try to get a full 8 years, and then get out. Maybe by the time he’s done he’ll actually be a billionaire (there’s fairly strong evidence that he’s not a billionaire right now, worth perhaps a few hundred million at most).

      On the other hand, war is a good way to make a lot of money, so maybe we do need to worry about Trump more than I think. Still, I lean towards Trump taking a non-war path on his looting spree.

  • Stevenemartin

    Supply and demand. As long as we can bring workers here from the third world to artificially increase the supply, there will be no middle income.

  • guy

    Couldn’t agree more… the tech world thinks/believes it is doing things to make the world a better place. But it is just following a general trend in the USA. There was recently a segment on FreshAir that described the middle-class workers issue in manufacturing, with the elite distancing themselves. See: http://www.npr.org/2017/02/06/513713606/glass-house-chronicles-the-sharp-decline-of-an-all-american-factory-town

  • Abhijeet Sharma

    Nice article with very intriguing question raised by. Tech need tobbe for people irrespective of User type.These company have to adopt a widen portfolio. From a farmer to shopkeepers to a high end gaget users.

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