If you have not yet read Part I: Escaping the Rat-Race available free to all readers, please click here to read it first.

In Part 1, we reviewed the forces of structural change in the economy and the nature of work.  In Part 2, we’ll cover the matrix of work (how to create value in the age of automation) and discuss specific strategies for building a resilient career you control.

The Matrix of Work

In the traditional capital/labor model, labor is paid by the hour to perform routine work.  In the emerging economy, routine work is increasingly performed by machines or outsourced.  In this environment, the premium for human labor arises from creating value and solving problems.

The tool I use to understand this premium is the matrix of work, which is the overlay of the five forms of value creation: non-process-based work, high touch, non-tradable work, sensitivity of the output to mastery and flexibility.

Let’s start with commodification:  when goods or services can be traded interchangeably across the globe, these become commodities, as opposed to one-of-a-kind goods and services unique to one small-scale producer. A Fuji apple from Washington State is the same as a Fuji apple from overseas in terms of its tradability and retail value.

Labor can also be commoditized:  if human labor is being sold as time performing basic skills, then the time and basic skills can be bought and sold interchangeably around the world.

Work that is process-based is easily automated or commoditized, meaning that it can be performed anywhere by interchangeable laborers.  Process-based work can be broken down into tasks that take a specifiable input and yield a specifiable output.

One way to avoid being commoditized out of a job is…