As technology advances, many jobs, companies, and even entire industries will be destroyed.
Isn’t that FANTASTIC!!!
Wait…Fantastic? Since when was destroying jobs fantastic???
Answer: When, as a result of certain job losses, economic conditions actually improve for most of society.
Job losses and business failures as a result of new and improved technology is often referred to as Creative Destruction. First coined by Economist Joseph Schumpeter in the 1940’s, Creative Destruction is the “process of industrial mutation that incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one.”
Simply put, old products and companies must die for newer and better products and companies to thrive.
Capitalism is evolutionary, not stagnant. As newer and better products and services are created, old industries must fail. As they say, the automobile industry was hell on the horse and buggy industry.
The best way to visualize Creative Destruction might be to consider the agricultural industry. In 1900, 41% of the U.S. workforce was employed by the agricultural industry. Now, less than 2% of the workforce is employed in agriculture.
Isn’t that sad about all of those lost agricultural jobs? Nope. It’s not sad…it’s fabulous. Because of innovation and technology, we now have cheaper, safer, and a more reliable source of produce, without the countless back-breaking man hours spent in the scorching sun.
A more timely example might be to examine the simple act of purchasing movies and television shows. Think of all of the poor souls that lost their jobs when the Blockbuster Video stores shut down…but it’s so much better to purchase a movie from the comfort of your home using one of the countless streaming services out there.
Actually, the most successful companies destroy their own products all of the time. Consider the fact that Apple 7 basically destroyed the market for all previous Apple iPhones.
With the rapidity of change in today’s business landscape, Wildcatters need to be ever vigilant for the next “BIG” thing. Equally important, Wildcatters need to be prepared to bail out on failing investments before they in end up in the trash heap of “destroyed” products and industries.
For the greater good of society, LET THE DESTRUCTION CONTINUE!!!