Occupational Hazard

Posted: 10/1999

Occupational Hazard
Telecom Careers Headed for Detour
By John McMorrow

The telecommunications industry is changing and so are its jobs. Industry and
occupational boundaries will begin to blur. Changes in consumer demand, markets,
technology and business practices will reshuffle labor demand. New occupations will emerge
and other occupations will disappear. While total employment will fall, new and expanding
opportunities within the industry will also emerge.

Within the telecommunications industry:

* The Telecommunications Act of 1996 is fundamentally changing the industry. The act
will accelerate competitive pressures within the industry while opening up new
opportunities for companies.

* Technology will continue to drive change in the industry as new products and services
are offered, product and technology life cycles are shortened and as companies introduce
new technology to lower costs and improve service quality.

* Mergers, joint ventures and strategic alliances will continue in the industry as
companies search for new opportunities and markets.

* Globalization of the telecommunications industry will continue and many U.S.-based
companies will expand their markets by entering overseas markets, increasing consumer and
business demand for telecommunications services.

* New companies, markets and opportunities will emerge as the information industry
converges and existing lines of business will decline. As a result, companies will
constantly reconfigure and resize their workforce and the knowledge, skills and abilities
needed will change.

How will these changes translate into employment prospects within the
telecommunications industry? Using data from the U.S. Bureau of Labor Statistics, which
prepares employment forecasts to 2005, we can look at its suggestions about employment
prospects within the telephone communications industry.

The Telecommunications Industry in 2005

Increased competition and the rapid introduction of technology will drive industry
changes. As a result, the demand for occupations will shift and the skills needed will
continue to evolve and increase. Based on the Bureau’s data, the employment landscape in
telecommunications will change in the following ways.

Total employment in the telecommunications industry will decline by just over 11
percent between 1994 and 2005. This decline translates into more than 100,000 jobs
disappearing within the telecommunications industry over the next 11 years.

The aggregate picture of decline masks how the demand for telecommunications services,
technology and changes in business practices are changing the occupational structure of
the industry, the skills needed and the specific occupations that will grow and those that
will decline.

Occupations that once offered stable and solid careers will decline. Employment in
occupations such as operations managers, operators, private branch exchange (PBX)
installers and other installation repair jobs will decline in both absolute and relative
terms. In addition, an increasing share of the market for telephone services is being
captured by smaller companies that use technology to create a competitive edge and larger,
old-line companies are losing market share.

Other positions, once unheard of and others that are yet unidentified, will grow
rapidly. Technical occupations such as engineers and engineering technicians, computer and
systems analysts, and a range of marketing and sales occupations will grow. Many of the
fastest-growing occupations in the industry fall into all other categories, which suggests
we have not yet developed occupational codes to capture this new growth. As Gerald Taylor,
former CEO of MCI Communications Corp., once observed, "By the year 2000, 50 percent
of the revenues telecommunications companies bring in will be from businesses they are not
in today."

The knowledge, skills and abilities needed in new and existing occupations will change.
Technical, computer, teamwork and communication skills will become more important as the
industry changes. For example, many technician jobs will troubleshoot, identify and fix
problems using computers.

Shifting Composition of the Labor Force

The mix of occupations in the telephone communications industry will shift over the
next 10 years as more employment is in white-collar technical and sales occupations, and
employment in repair and installation occupations will decline.

However, many of the occupations in demand have elements in common with the occupations
that are declining. Obtaining the necessary education and training needed within these new
occupations will improve one’s opportunity for continued employment within the industry
and company. Many of the knowledge, skills and abilities needed in customer service
occupations are similar to those possessed by telephone operators. In addition, emerging
jobs, such as engineering technician, will demand skills related to the skills needed in
declining occupations, such as installation and repair.

Employment within managerial and administrative occupations, management-support
occupations, and professional-specialty occupations will increase in both relative and
absolute terms. As a share of total employment, these three broad occupations will
represent more than one in five jobs within this industry by 2005–an increase of nearly
one-third from their 1994 level. Roughly 30,000 new jobs will be added in these categories
between 1994 and 2005.

Within the telecommunications industry, management and administrative occupations will
increase their share of employment by one-quarter and will account for nearly 11 percent
of all employment by 2005. While some companies are reducing administrative layers, new
companies are emerging that will continue to fuel the growth and demand for these
occupations. In addition, as competition becomes more intense and technology becomes more
prevalent, the demand for marketing, engineering and other types of managers will
increase. However, the demand for operations managers will fall. As more work is carried
out in self-managed teams and more operations are consolidated into centralized locations,
the demand for operations will decline.

Professional-specialty (engineers, systems analysts, etc.) and management-support
occupations (management analysts, accountants and human resource specialists) will
represent a larger share of employment, increasing from about 7.5 percent of all
employment in 1994 to 11 percent by 2005. Indeed, employment within professional-specialty
occupations is expected to be the occupational group experiencing the largest absolute
growth (a 36 percent increase in employment and the addition of more than 17,000 new
jobs). Related to the growing demand for professional-specialty occupations, demand for
engineering technicians also will increase between 1994 and 2005.

Employment in marketing and sales occupations will increase in both absolute and
relative terms. Driven by increasing competition and the need to retain and expand their
customer base, companies will increase the demand for marketing and sales occupations.

More than one in five jobs will involve sales and customer service in 2005. Marketing
and sales occupations will account for nearly 8 percent of all jobs within the
telecommunications industry and will add 10,000 jobs between 1994 and 2005. Strongly
related to this growth, customer service occupations will represent nearly 13 percent of
all jobs within the industry and add more than 17,000 jobs.

Overall employment in administration support occupations will fall. Nearly four out of
every 10 jobs in the telecommunications industry are in this category. The growing use of
computer technology and voice recognition technology is steadily reducing the demand for
telephone operators. While representing nearly 10 out of every 100 jobs in the industry in
1994, telephone operators will represent about three out of every 100 jobs in the
telephone communications industry in 2005. Nearly 34,000 telephone operator jobs will be
eliminated by 2005. The demand for billing clerks will fall as more and more of the
billing process is automated. The growing demand for customer service representatives
(CSRs) and information clerks will offset the decline in these occupations partially.

In addition, the employment prospects for many skilled craft and repair occupations
will fall. Demand for mechanics, installers and repairers within the industry will decline
and the share of total employment will fall by one-fifth between 1994 and 2005, as more
than 90,000 positions are eliminated. As the price of telephones continues to fall and
their reliability increases, consumers will purchase new equipment rather than repair old
equipment, thus lowering the demand for repair services. In addition, technical
improvements such as self-healing networks, pre-wired buildings, telephone jacks and
modular telephones will continue to drive down the need for telephone installers. At the
same time, as the conversion to fiber optics and the like is completed, the demand for
line installers and the similar occupations will fall.

Basic Competencies for Industry Workers

While the data will not tell us exactly the specific skills (i.e., a particular type of
computer language that will be needed) that will be in demand, we can offer some general
findings about the broad skills that are common to many of the growing occupations. A new
set of core competencies in the telecommunications industry will emerge. The new
telecommunications industry will require workers be flexible and continue upgrading their
skills and knowledge base.

As marketing and sales jobs increase, oral and written communication skills will become
more important. Communications skills will become more important as more and more work is
performed in teams. Employees also will establish effective working relationships with
many different people, both within and outside the company. Also, as companies increase
their presence in markets outside the United States, foreign language skills and
sensitivity to the customs and cultures of other countries will be an important asset for
employees.

Technology also is changing the skills needed. As technology becomes more pervasive,
the need for computer and technical skills will increase and change. Familiarity with
complex systems and computer literacy will become essential for many of the new jobs in
the telephone communications industry. At the same time, technical skills will continue to
evolve and the ability to adapt to changing requirements will increase. Many jobs will
require the use of computers to maintain, diagnose and fix problems.

The ability to gather, understand, analyze and manipulate information will become more
important. More and more jobs will require less hands-on skills and increased interaction
with information. Many repair and technician jobs will involve gathering, analyzing and
fixing problems based on information that comes across a computer screen.

As companies reorganize their workplaces and flatten their management structures, the
demand for interpersonal and teamwork skills will increase. Companies will turn to using
teams composed of a variety of people from many occupations to work on particular
projects. Teams will constantly form and dissolve as projects are completed and new
projects begin. Interpersonal skills, such as the ability to work in a team setting and to
communicate effectively across disciplines and occupations, will become more important. In
addition, employees will interact with a variety of people in customer sites. Some will
interact with customers to install and monitor systems, others will work with suppliers
and others will work with teams that will include employees from outside their
organization.

John McMorrow is the president and CEO of Talent Alliance, Morristown, N.J., a
collaboration of forward-thinking organizations providing their employees with
Internet-based career management tools and resources to compete in the 21st century. He
can be reached at +1 888 WORKWAYS or [email protected]