Innovation and US jobs: two types of opportunity- of iPhones and frozen yogurt

Given the substantial interest in previous posts about how innovation creates jobs here are some more thoughts on exactly how these jobs can happen. But first about innovation which is at its most basic level is: doing something new. The newness can be huge like when the iPhone was introduced or can be just opening the first frozen yogurt shop in your town. Let us think about the kinds of job opportunities both these create:

  • The Hi-Tech iPhone involved a great deal of design and technology at the back end. It simply created a global consumer following bordering on frenzy with every new model. The consumer demand is what created all the jobs in its supply chain including many overseas jobs. The high paid jobs in the US are in design, software but not so much in manufacturing. But when you think of the iPhone marketing related jobs you think of the huge boost AT&T got from its exclusive arrangement in distributing the iPhone in the US. Don't forget those little kiosks in the mall that sell iPhone cases and screen covers and the person who is happy to neatly paste a screen cover for $5 on to your iPhone or smart phone. In fact, the employment effects just continue to competing products like Samsung despite the controversy surrounding patent infringements. An amazing spillover of the iPhone and an Apple store in an US mall is estimated at a 12% rise in sales per square foot according to a Time magazine article. In other words, it is not just Apple that becomes hugely profitable but there is a whole bunch of jobs that is created in the supply chain, distribution channel and the telecom service providers. You can be sure that telecom equipment makers like wireless tower makers also got additional business due to the huge consumer adoption of the iPhone. The majority  of the retail and customer service jobs associated with the iPhone are low pay but do require the individual to be interested in technology to be able to service the customer. The so called steady well paid manufacturing jobs are mainly in China but are not well paid by US standards. And the comparatively few high paying design and software jobs at Apple involve a great deal of education and expertise.
  • Comparatively  Low-Tech Frozen Yogurt is catching on in the US and retail stores are popping up given the increased health consciousness. Here the dairy farm is US based and the Yogurt factory is local as are the employees of the store who need to be present to serve customers from an assortment of flavors and toppings. The selling price, margins and sales volumes are decent but much more modest compared to an Apple store. As a result the associated jobs in the supply chain, distribution channel are also more modest. In fact, if a customer had an Yogurt the neighboring sandwich shop might actually lose business ! Nevertheless, the Frozen Yogurt business does create jobs and with global marketing like Apple might create a great deal of opportunity for US entrepreneurs.

To summarize, while lifetime traditional manufacturing jobs seem to be disappearing new opportunities are opening up in global marketing at both ends of the technology spectrum. Contact StratoServe.

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