Innovating to Solve Problems
The 2017 hurricane season was one of the most active of the new century, and scientists are predicting hurricanes will likely get more intense in the decades to come.1 But these predictions for worsening conditions in the future may pave the way for stronger innovation.
For example, the governor of Puerto Rico, which was devastated by Hurricane Maria in September, suggested the island rebuild its power resources into a microgrid. This strategy means that power outages caused by storms would be more localized so a huge area isn’t impacted when one system goes down. It also would accurately pinpoint which grids need repair and better assign resources so that power can be restored more quickly.2
The microgrids could be powered by alternate and renewable resources such as wind and solar energy, which would be better for the environment and less expensive for residents. This type of innovation could avoid the need to completely rebuild infrastructure the next time a major hurricane hits the region.3
There are two issues when considering the catastrophic nature of a disaster like a hurricane. The first is societal – how do we restore power and other infrastructure after a crisis? The second is personal – how do we recover when our homes are damaged or demolished? While we seek and embrace innovations that can lessen the damage caused and hasten our recovery, the current solution is to insure against losses that can devastate us financially.
Other issues that are cropping up in today’s society are spurring innovation. For example, researchers say the U.S. workforce participation rate is declining. In fact, a recent analysis found that one-third of prime-age men not in the labor force have a disability. Rising incarceration rates have impeded the workforce even after release, due to criminal records.3
Furthermore, increasing numbers of baby boomers are retiring each day, and younger generations might not have, at this point, the skills and experience to take their place.4 With so many critical issues converging, who will work America’s jobs?
Enter robotics, artificial intelligence and machine learning. Today’s technology not only has robots and computers performing a wide range of routine physical work activities better and more cheaply than humans, but they are increasingly capable of providing cognitive insights that were once considered too difficult to automate. This includes sensing emotion, driving vehicles and even making decisions.5 Scientists project that automation is poised to change the daily work responsibilities for a spectrum of jobs, including miners, landscapers, commercial bankers, fashion designers, welders and even CEOs.6
It’s worth considering both the pros and cons of automated labor. While this type of innovation may create a less expensive workforce for American companies, it also reduces the overall tax base. Which leads us to the question: Will the remaining human workers have to pay higher taxes to cover government programs and expenses, or will companies need to pay taxes on robot workers?7
Content prepared by Kara Stefan Communications.
1 Michael Greshko. National Geographic. Sept. 22, 2017. “Why This Hurricane Season Has Been So Catastrophic.” https://news.nationalgeographic.com/2017/09/hurricane-irma-harvey-season-climate-change-weather/. Accessed Nov. 9, 2017.
2 Brad Jones. World Economic Forum. Oct. 6, 2017. “Puerto Rico is using an unusual method to restore power after the hurricane.” https://www.weforum.org/agenda/2017/10/puerto-rico-is-using-an-unusual-method-to-restore-power-after-the-hurricane. Accessed Nov. 9, 2017.
3 Eleanor Krause and Isabel V. Sawhill. The Brookings Institution. Feb. 3, 2017. “What we know – and don’t know – about the declining labor force participation rate.” https://www.brookings.edu/blog/social-mobility-memos/2017/02/03/what-we-know-and-dont-know-about-the-declining-labor-force-participation-rate/. Accessed Nov. 9, 2017.
4 Dona DeZube. Monster.com. “Bye Bye Boomers: Who Will Fill your Workforce Gap?” https://hiring.monster.com/hr/hr-best-practices/recruiting-hiring-advice/strategic-workforce-planning/baby-boomer-workforce-gap.aspx. Accessed Nov. 9, 2017.
5 James Manyika, Michael Chui, Mehdi Miremadi, Jacques Bughin, Katy George, Paul Willmott and Martin Dewhurst. McKinsey Global Institute. January 2017. “Harnessing automation for a future that works.” https://www.mckinsey.com/global-themes/digital-disruption/harnessing-automation-for-a-future-that-works. Accessed Nov. 9, 2017.
7 Kari Paul. MarketWatch. Sept. 28, 2017. “Why robots should pay taxes.” https://www.marketwatch.com/story/why-robots-should-pay-taxes-2017-09-12. Accessed Nov. 9, 2017.
We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.
The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.
Content obtained through a PR firm.