Dr. Mike Walden
North Carolina Cooperative Extension
Some say the next several decades will be the “age of remakes.” I don’t mean old films that have new versions produced, nor do I mean personal style remakes – like new clothes and a new hair fashion – although most would agree I certainly need the latter! Instead, I mean an “occupational remake,” where a person literally restructures what he or she does to earn a living.
Futurists say occupational remakes will become increasingly common – out of necessity. As technological advancements in artificial intelligence and robotics shift a greater number of jobs away from workers to machines, workers will have to change what they do in order to be employed.
I know this can sound almost natural and normal. It’s easy to say, “Go back to school and learn something new.” But for most people it’s not easy. I was lucky: I changed my skill set early in my career and have had the same occupation now for almost four decades.
But for people in mid-career – say 10 to 20 years into their work life – learning something new and then finding a different occupation can be both scary and traumatic. How will they live while back in school? How will the bills be paid and care provided to children? And will a geographic move have to be made to find a new job?
I’ve been reminded of these issues after following the recent experience of one of my closest friends. He had a great career in the personal service field that allowed him to purchase a home, drive a new model car and take regular summer vacations. His business expanded so well that after a decade he quadrupled his number of employees. He was on the verge of moving his business to a prime location in the heart of the city.
Then the Great Recession hit! Like most business people – and professional economists, too – my friend knew the economy was slowing, but he had no inkling of what was about to happen. As the recession deepened and unemployment surged, my friend’s business clients began to melt away. First he lost 10 percent, then 20 percent, and then one-third of his clients left. At the peak of the recession, more than half of my friend’s clients were gone, and his revenues actually dropped by more.
Amazingly, I never heard my friend complain. I was aware his business was slowing, but I didn’t know the extent. Our friendship went on as if nothing had changed.
Only later did I learn how much my friend’s business had been devastated when he told me about the changes he had been forced to make to his life and career. Gone were the vacations. Restaurant meals went from being normal to being a luxury. The late model car was switched for a serviceable, but aging, clunker. And my friend worked with his mortgage company to temporarily reduce his monthly payments until he got back on his feet.
How did he eventually get back on his feet? He remade his career. In fact, my friend added a second career. He kept working at his personal service business, even though he was earning much less than he had prior to the recession. At least the business provided him a steady source of income to meet his (now much diminished) lifestyle.
But at nights, my friend went to school and learned another career. He put in long hours reading and studying and then finally being certified in a new field. Fortunately for him, he could coordinate his two jobs, doing online work in the new occupation during the downtime of his personal service business.
Today, my friend is almost – but not quite – earning income equal to what he made before the Great Recession. We’ve now talked about what he went through. He has a surprisingly good attitude about what happened to his life. If anything, he considers himself lucky. Just before the recession hit, he didn’t sign the lease for the fancy downtown office. If he had, he was probably staring at bankruptcy.
And he found a second career that he is good at and enjoys.
I hesitate to make any generalizations or recommendations from my friend’s experience, because everyone and every situation are different. When faced with an economic calamity, my friend focused on the two sides of the economic equation: costs and income. The first thing he did was work on lowering his costs. This is easier said than done, but it’s necessary when bad times arrive. So a smart thing that most of us can do is to have a contingency plan for cutting our household costs.
Step two for my friend was to increase his income. For him, this took time and some money, but it ultimately paid off. So the second part of an economic disaster plan is to think about alternative careers and the costs and time of training for them.
One hopes that, in most of our lifetimes, we will never go through a period like the Great Recession. But even in the best of times, occupations and careers are continually being downsized while new opportunities are being created. My friend faced this, but he had a plan. Is his roadmap one that most can replicate? You decide!
Dr. Mike Walden is a William Neal Reynolds Distinguished Professor and North Carolina Cooperative Extension economist in the Department of Agricultural and Resource Economics of North Carolina State University’s College of Agriculture and Life Sciences. He teaches and writes on personal finance, economic outlook and public policy. The College of Agriculture and Life Sciences communications unit provides his You Decide column every two weeks.
Previous columns are available at http://www.cals.ncsu.edu/agcomm/news-center/tag/you-decide
Related audio files are at http://www.cals.ncsu.edu/agcomm/news-center/category/economic-perspective