In 1915, the future of work and workers was made in Detroit.
In less than two decades, the American automobile industry had turned the business world upside down. Assembly lines replaced machine shops. Responding to worker activism, automakers shortened working hours, created a two-day weekend, and doubled compensation. Everyday life was transformed as a rich man’s toy became an affordable commodity. Eventually, one in six working Americans would have a job connected to the auto industry.
Margaret O’Mara teaches American history at the University of Washington and is writing a book about the politics and culture of Silicon Valley.
In 2015, the future of work and workers is being made in Silicon Valley and Seattle, headquarters cities for the largest consumer technology companies in the world.
Like Detroit, tech has made its products ubiquitous and essential. It has transformed the way goods are bought and sold. And it’s allowed people to connect and communicate as never before.
But the industry’s influence on the future of work goes beyond high-tech tools, artificial intelligence, and the sharing economy. Just like Henry Ford and his assembly line, the leading companies in tech have become high-profile models for the 21st-century workplace.
They should be. The industry has a rocket-fueled capacity to invent and innovate, disrupt and transform. But recent headlines about overworked Amazonians, monumental new tech campuses, and swaggering “brogrammers” have left people confused. Are techies exploited or coddled? Is this a meritocracy or an old-boys’ network? Are they changing the world or getting rich?
The answer to each question: both. And the distinctive ways of tech are fundamentally changing the worker-management compact in place since the age of Ford. Here’s how.
- GOODBYE, EIGHT-HOUR DAY: Go inside a high-tech headquarters, and you’ll see a very different scene from the offices and factories of 100 years ago. Google’s facilities boast climbing walls, massage rooms, and free food. Amazon’s motto: “Work hard. Have fun. Make history.” Tech companies regularly top lists of “great places to work.”
The original model was HP, founded by Bill Hewlett and David Packard in 1939. The two adopted a deliberately non-hierarchical style that Hewlett liked to call “management by wandering.” They did away with office doors in favor of open floor plans, and exchanged suits for shirtsleeves. Executives and middle managers played volleyball and horseshoes on the lawn out back and spent their off-hours socializing.
Successive generations of tech start-ups expanded on HP’s model to blur the lines between work and play. This makes life in tech both fun and relentlessly demanding. It fuels creativity and loyalty, and drives innovation at a punishing pace. In the early 1980s, Apple employees wore their 80-hour workweeks as a badge of honor, and an unavoidable cost of changing the world. Three decades later, not much has changed.
- TRADING SECURITY FOR STOCK OPTIONS: Sixty years ago, 40 percent of American workers had unionized jobs. The chief operating principle of the workplace was “security”—of long-term employment, of good pay, of benefits. Today’s techies have exchanged their grandparents’ pension plans and lifetime employment for stock options and frequent job-hopping.
Again, this didn’t appear overnight. Back in the early days of Silicon Valley, small start-up firms didn’t have the money to offer their workers fat salaries, so they gave them a stake in the company instead. This became a secret of the industry’s success: When a tech firm hit it big, everyone got rich. Yet when it didn’t (as happens about nine times out of 10), they had nothing.
In the industrial age, workers were part of a collective, with interlinked economic fates. In the digital age of stock options and start-ups, every worker is a risk-taker and an entrepreneur—and celebrated for being so. The entrepreneurial ethos extends to blue-collar workers in tech who usually aren’t employees but contractors, working on-demand and without the security that unionized workers had in the heyday of Detroit’s Big Three.
Tech rewards the risk-takers, and by doing so has encouraged big thinking and business audacity. Unsurprisingly, those who can make these big gambles are often young, do not have others who depend on their paychecks, and have family or community resources to help them.
- IT'S WHO YOU KNOW: One of the biggest recent tech-industry stories has been its truly dismal record on gender and racial diversity. Google revealed last year that its vaunted technical workforce was only 17 percent female and three percent African American and Hispanic. Other Valley giants unveiled equally depressing numbers. A discrimination lawsuit against one of Silicon Valley’s biggest venture capital firms added fuel to the fire.
After a year of high-profile efforts, not much has changed. While many factors feed this diversity dilemma, a lot of it has to do with the intensely personal nature of hiring in the industry. Again, this deep-rooted trait has been a key to the industry’s success, while being one of its biggest stumbling blocks.
Dial back to the early 1960s. The small-electronics and venture capital industries were new. Their leaders: a small cadre of very smart people who had abandoned safer careers in the all-male professions of engineering and finance to go out on their own. In this small and tightly knit community, the way to get ahead was to work together, and hire people you knew and trusted.
More than half a century later, personal connections continue to have a huge impact on hiring decisions in tech. Salesforce.com holds “Bring a Referral” happy hours for its employees, and gets 58 percent of its new hires from employee referrals. Twitter hires 40 percent of its workers this way. On top of this, tech companies of all stripes place a premium on degrees from elite universities.
Just as Ford’s assembly line was an ideal way to mass-produce cars, so has the hard-working, freewheeling, not-so-meritocratic techie workplace been an ideal incubator for big ideas and next-generation innovations. But this model is due for some updates.
The work-hard, play-hard tech ethos was an innovative strategy for an era when most techies were men with stay-at-home wives. Today, these companies should be innovators and disrupters in supporting working parents and caregivers—or anyone who wants work-life balance.
Similarly, entrepreneurship requires taking big risks. Lots of people have life circumstances that stand in the way of that. Bold interventions in policy and in business can help more take a leap.
Some veteran techies are launching projects along these lines that could have a huge impact at scale. One Seattle investor recently vowed to fund only companies with female co-founders. New mentorship programs link first-generation college students into networks of experienced entrepreneurs. Building these kinds of programs—and, yes, making special preferences—will enlarge the circle of who is known and trusted, hired, and promoted.
Tech companies (and the billions of users of their products) have a great chance right now to change the rules of the game, and increase opportunity for all sorts of workers.
For the Future of Work, a special project from the Center for Advanced Study in the Behavioral Sciences at Stanford University, business and labor leaders, social scientists, technology visionaries, activists, and journalists weigh in on the most consequential changes in the workplace, and what anxieties and possibilities they might produce.