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Management: Teleworking will widen wages gap

DAVID REIM, president of Simstar Inc, is 'an entrepreneur of the Nineties', writes journalist Steve Kaufman in the San Jose Mercury News. 'Working with four Macintoshes in the bedroom of his Sunnyvale (California) apartment, he is building a company that makes interactive multimedia software for health-care patients.'

As the company's only employee, he teams up with independent partners. 'I simply view myself as a general contractor who manages his subcontractors over a computer network,' he told Kaufman.

Norman Macrae, former deputy editor of the Economist, was among the first to foretell a de-massified world, with most commerce performed by entrepreneurial enterprises. Most labour, he claims, will be accomplished by free agents utilising advanced global telecommunications and computer networks.

Macrae depicted the mythical McGonagle family in 2020, living in a community run by a Dutch insurance company. The insurer offers them a contract - guaranteed levels of environmental cleanliness, personal security and other measured services in return for a fixed property-tax rate.

Problems with their child lead the telecommuting McGonagles to consider moving. To start the process, they survey a raft of community contracts available throughout the world.

Sounds loony? I'm not so sure. In the United States alone, there are seven million telecommuters, according to Management Review magazine. The UCLA Institute for Industrial Relations reports that contract workers comprise 24 per cent of the current corporate payroll - heading towards 40 per cent by the end of the decade.

'The future belongs to . . . self-employed, project-focused, knowledge-based specialists,' the California-based consultant Charles Skorina claims. 'Corporations will . . . retain a small cadre of managers to hire and co-ordinate the activities of project specialists.'

'People will work at different places at different times and may not necessarily do the same thing from week to week,' Professor Franklin Becker of Cornell told Management Review.

'In the coming millennium,' the magazine concludes, 'the idea of arriving at an office at 9am, parking yourself at a standard rectangular desk and remaining confined there until the workday is complete will seem as archaic and incomprehensible as that of using an old IBM Selectric does today.'

'The unskilled, single-task factory jobs that helped build the middle-class lifestyle for generations of American workers have been steadily disappearing - automated out of existence, lost to foreign countries, or . . . replaced by a smaller cadre of workers who can operate computers as well as heave boxes,' Frank Swoboda writes in the Washington Post.

'A powerful digital information network stretched across the country will revolutionise our daily lives,' Rory O'Connor reports in the San Jose Mercury News.

The cumulative effect of these announcements is unsettling. Yet after decades of over-estimating information technology's potential effect on the way we live and do business, we now seem to regularly underestimate the enormity of its impact.

But can this vision of self- employed folk peanut-buttered evenly around the globe encompass the majority of the world's - or at least the advanced economies' - workers? And isn't there an enormous and growing wage gap between knowledge workers and the 'Reeks and Wrecks', as Kurt Vonnegut called the rest in his prescient 1952 novel, Player Piano?

Yes, the soaring wage disparity is scary. Commentators from management guru Peter Drucker to Robert Reich, the Labour Secretary, and Alan Blinder of the Council of Economic Advisers, put the growing gap atop America's long-term economic (and social) agenda.

On the other hand, the shift towards making everyone a knowledge worker, employed on entrepreneurial projects, is no pipe dream: My studies suggest that most corporation work is quickly becoming multifunctional, self-management/self-initiated projects.

Maybe it's not such a stretch from the tidal wave of projectised self-managed contract work to the end of the office, wholesale telecommuting - and even those insurance company-led communities.

We have lots to learn about working and creating value in the new-fangled, disembodied economy. But I, for one, have decided to quit snickering when I hear the likes of Macrae declaiming on a very curious tomorrow.

1993 TPG Communications