A GMJ Q&A with Jim Clifton, CEO of Gallup and author of The Coming Jobs War.
The United States has no shortage of great ideas and innovations. What the country most needs right now are highly motivated entrepreneurs who can turn those ideas into great businesses -- and thus create millions of new jobs.
China fills needs; Steve Jobs created needs. Nobody knew they needed an iPhone.
So says Gallup Chairman Jim Clifton in his book, The Coming Jobs War. Clifton is worried because America and much of the rest of the world are trying to boost innovation while entrepreneurs -- living, breathing, job-creating engines -- are neglected.
Clifton's book draws from Gallup's extensive analysis of U.S. and worldwide poll data, macroeconomic data on job creation, and trends in world economics. That analysis has uncovered astonishing and sometimes discomfiting facts. But a central finding of the book is that the will of the world has changed.
People used to desire love, money, food, shelter, safety, peace, and freedom more than anything else. Now, however, what everyone in the world wants is a good job. And as Clifton discusses below, by concentrating on innovators and neglecting entrepreneurs, we may be making it harder to create the jobs the world wants and needs.
GMJ: In your book, you emphasize America's rivalry with China. How can the U.S. compete effectively with China in the war for good jobs?
Jim Clifton: The U.S. has to keep creating, as it has in the past, the next big things and selling them. Everybody's been talking about the late Steve Jobs. You see, Steve Jobs wasn't meeting needs; his company never met a need. Steve Jobs and his company createda need. I wish all of America could get an A on this pop quiz because it's so important: China fills needs; Steve Jobs created needs. Nobody knew they needed an iPhone. The same thing was true with the transistor and flight and Henry Ford's mass production of cars.
The country that invents the future wins the jobs war, and inventing the future is what great entrepreneurs do. But China's just meeting already-existing needs. They're filling orders. They don't create the future.
GMJ: So you're saying that America needs to invent and engineer and design the things that the world doesn't know it needs yet?
Clifton: Yes -- and let China or somebody else manufacture it. I know that hurts, but we can adjust. It wasn't all that long ago that a whole lot of Americans were farmers, and our economy was mostly agricultural. We adjusted. Now, the real money is in creating the business, not manufacturing the thing.
Businesses like the one Steve Jobs created and businesses like Intel and Microsoft and Amazon and Groupon and Facebook and eBay -- nobody else sees that stuff coming. Nobody else says, "Hey, we need a site where we can post pictures from the weekend. We need a site that's basically a 24/7 garage sale." That wouldn't have market tested well. But look at Facebook and eBay -- they're multibillion-dollar companies that created jobs for thousands of people.
We've got to accelerate that. To imagine that we'll compete with China and those manufacturing jobs will come back is hallucination -- or at best, wishful thinking.
GMJ: People say that America will beat China because the U.S. is full of innovators and China isn't. What do you think?
Clifton: For one thing, that's not true. China can innovate. But they don't have a culture that understands the power of engaged workers. Right now, they just out-low-cost-manufacture the world. But that won't last forever. Their wages will keep going up, and jobs will go to other places -- to Southeast Asia, to India, probably some to Africa, maybe some to parts of the Middle East.
GMJ: But for now, it's safe to say they're winning the jobs war?
Clifton: Definitely. Yes, they've got the momentum right now.
GMJ: Then why does it matter if China has engaged workers?
Clifton: Because engagement is a precondition for the state of mind that creates entrepreneurs. Miserable workgroups chase customers away. Miserable workforces don't create any economic energy, so those companies are always cutting jobs. America will not come back and win the world unless we have the most spirited workforce. Spirited workforces create new customers. New customers create new jobs.