Are you ready to compete in the creative economy?

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Just do a quick comparison of the market value to the book value for public U.S. companies over the last two decades and you will see the dramatic upward rise in value attributed to intangibles – ideas, innovations.

In this new world, wealth creation is dependent upon the capacity of a nation to continually create ideas.  In short, a nation without a vibrant creative labor does not possess the knowledge base to succeed in the creative economy, and must depend on ideas produced elsewhere.

The creative  economy is a new world in which people work with their brains instead of their hands.  A world in which communications technology creates global competition.  A world in which innovation is more important than mass production.  A world in which investment buys new concepts or the means to create them, rather than new machines.

The new economy demands different skills from its workers. As the economy churns (thanks to that global marketplace), it puts a higher premium on creativity and the capacity for innovation. A well-known formulation of this argument comes from Robert Reich (1991), who argues that the economic well-being of countries depends on individual skills rather than the profitability of corporations.  In particular, to ensure that people do well requires the right kind of investment in training. The skills of “symbolic analysts” (as opposed to routine producers or providers of in-person services) are most in demand in the new economy.  We should therefore be making sure people acquire those skills

It’s not bad for a career either.  Data shows that people who work in creative occupations earn an average of $20,000 a year more than those in non-creative jobs.   But most of us don’t view ourselves as being highly creative.  We lack self confidence that we are ready to compete in this new economy.

Why?

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7 thoughts on “Are you ready to compete in the creative economy?

  1. In my experience there is a lot of resistance to creativity, even in high technology, because sometimes it threatens the status quo and the profits from creativity may not be realized within the span of a financial quarter. Before I was laid off, I was on a highly creative team that had won an internal company innovation competition. Over half of that team was laid off within a year of winning that competition. When things like that happen, it sends a message to the rest of the employees that if you innovate or behave in a creative manner, you are not valued to the company and you will lose you job. I’ve heard similar stories from people who work at various high tech companies and the government. It seems to be something widely spread now.

    I think, particularly now, it is tough to be creative or innovative because that is basically a forward looking activity that may not pay off until years later. Right now, companies are reluctant to invest in innovation until they at 99.9% that there will be immediate profits. Companies want to hold to their money “just in case.” However, I can’t really say what that “case” is. Anyhow, it’s always been explained to me as a matter of risk. However, I’ve always been of the mind that the riskiest thing to do is stand still. And, if I’m not mistaken, isn’t it a fundamental rule of capitalism was to put money to work to make more money, rather than to sit on it.

    It’s nice to dream about this innovation utopia, but it really can’t happen under a management culture that is driven quarterly by Wall Street and obsessed with revenue growth and increasing margins all the purpose meeting targets so they can get bonuses. For the company it basically amounts to self imposed starvation without the imagination or the will to see that there will be plenty of food if one plants a garden. So, I think until companies and management put Wall Street on the back burner, and start thinking long term, it’s going to be tough for the creative economy to flourish. In terms of large companies, long term thinking can encouraged by giving bonuses that reward long-term thinking behaviors. With regards to the rank-and-file employees, reinstating or dramatically increasing patent bonuses for business relevant inventions can go a long way (Celebrate inventors and inventing again, rather than celebrating the stock price. I think we see the case in point at Apple and Google that a high stock price is a consequence of excellent product innovation and not the other way around.) Outside of large companies, small companies and entrepreneurs are the real bright spot because they must innovate to come into existence.

  2. Could you describe a bit about what jobs you consider creative and which ones aren’t? I can understand that the cashier at most places would be an example of a non-creative job, but other jobs can be murkier. For example, in my job as a Web Developer, I’m creating new functionality or fixing bugs and each requires its own form of creativity. How do I solve this problem? How do I implement this feature? These are questions that I have to handle on a regular basis.

    Some people may be afraid of labels that can come with some descriptions. For example, I’d suspect that a lot of people think of the arts when the word “creative” is mentioned. The creating of stories, poems, paintings, sculpture, and symphonies would be a few examples. However, there is a lot of creatives in the sciences too but it isn’t necessarily as easy to see potentially. This can easily lead into a discussion where nerds are having to defend their study in a subject but my point is that some people may not want the label that comes with being considered “artsy.”