Looking Into Computers, Business, and Office

Henry Ford revolutionized industry in 1913 when he constructed a factory in which each worker assembled just one part of a car before sending it down a production line to another worker. Up to that point, automobiles were made from the ground up by a team of highly paid workers. As a result, automobiles had been an expensive means of transportation, a toy for the wealthy. Ford's innovation became known as the assembly line method of production, and it proved to be much more efficient at producing complex machines. It dropped the price of cars radically and made them affordable for average working people. Ford's assembly line method and the subsequent growth of the automobile industry fundamentally changed the way people did business in America and around the world.

By the twenty-first century another technological revolution had changed American business as profoundly as Ford's assembly line changed manufacturing. Ford's assembly line was part of what historians call the "Age of Industry." Today Americans live in what many economists are calling the "Information Society," a phenomenon brought about by the development of computers, computer networks, the Internet, and digital technology. In the Information Society, many manufacturing jobs—which were the backbone of the industrial economy—are becoming obsolete in the United States. Indeed, during the last decades of the twentieth century, computer technology affected the jobs of most workers at every level of the American economy by making workers much more efficient. The changes were dramatic and will continue to transform the way we work.

What's more, economists state that the revolution in American business is really twofold—it is political as well as technological. The United States is part of an ever-expanding global economy brought about by the end of the Cold War and fueled by growth in newly formed nations seeking to build their own economies. Trade agreements such as the North American Free Trade Agreement (NAFTA) and the General Agreement on Tariffs and Trade (GATT) have already had a great impact on American business by shifting many manufacturing and data processing jobs to countries such as India and Mexico, where labor is cheap. Though many laborers in the United States have had to find new work, the shift of jobs has led to an increase in commerce and profitability for U.S. companies.

This twofold revolution presents American business with great challenges—and opportunities. Historically, American business has shown a great ability to overcome and even profit by adversity. In the twentieth century alone, the American brand of capitalism survived the stock market crash of 1929, the Great Depression, a number of recessions, two world wars, the Cold War, great changes in family and society, and a reordering of the world political map.

The beginning of the twenty-first century brought new challenges, including high energy prices, corporate scandals, a new war in the Middle East, the Hurricane Katrina disaster, and resistance to the globalization of American business. The tragic terrorist events of September 11, 2001, and the continuing threat of more terrorist acts have taken a heavy toll on consumer confidence and American economic health in general. Despite periodic setbacks, however, business dominates American culture and remains immensely prosperous.

But what exactly is meant by the term "business"? The word has almost as many meanings as there are types of businesses, and in today's rapidly changing business environment, definitions are constantly evolving. In this article, "business" refers specifically to the management and administration of commercial enterprises. This volume discusses the people involved in staffing these enterprises and the jobs they do.

TODAY'S OFFICE

Every business or government agency that produces goods or services needs a variety of people to handle administrative and clerical responsibilities and to manage the operation. Most of these people work in offices. An office staff may range in size from one to thousands, but every organization—no matter what size or what type—requires office workers to deal with day-to-day tasks. Office workers handle many different aspects of a business, including bookkeeping, word processing, data processing, telecommunications, and others. They are needed in every sector of the economy—from manufacturing to transportation.

New technology has dramatically changed the way people do business. It has transformed many of the jobs traditionally performed in offices. In all cases, though, technology makes one basic contribution: it allows a greater amount of work to be done in a shorter period of time than would be possible without it.

The Early Development of the Modern Office

The modern office has its roots in the late nineteenth century. Following the Civil War, innovations such as the department store, the chain store, and the mail-order catalog business significantly increased the volume of manufacturers' and retailers' sales. As a result, more workers were needed to keep track of production, inventory, and sales. At the same time, the rise of large corporations required more sophisticated methods of running a business. This led to the development of more efficient procedures, which involved a high degree of administrative specialization.

Modern office procedures were made possible by inventions such as the telegraph, telephone, typewriter, and adding machine. These devices came into widespread use between the end of the Civil War in 1865 and the beginning of the twentieth century.

The Evolution of Office Equipment

Throughout the twentieth century new and innovative business machines were developed in quick succession. Each new generation of business machine made its predecessor obsolete. When a new piece of office equipment was first introduced, it was often greeted with skepticism. Eventually, however, the benefits of the equipment became obvious, workers' reluctance faded, and the equipment became standard. Such was the case with manual typewriters, which were commonly used in business offices in the early twentieth century. They were replaced by electric typewriters, which were then replaced by personal computers. In the same manner, photocopiers replaced carbon paper and calculators replaced adding machines.

In general, office equipment evolves to allow for increased automation. Office automation means using machines to do repetitive, time-consuming tasks formerly done by people. Machines also help workers get work done faster and more efficiently. Fax machines, for example, are used to send documents over telephone lines to offices within the United States or in other countries. The documents are received within minutes, instead of the days (or even weeks) once required to receive them via mail.

The Advent of Computers

The computer has revolutionized the modern office more than any other piece of equipment. Mainframe computers were introduced to the workplace in the 1960s and 1970s, but their very high cost and cumbersome size limited their use to large companies. By the 1980s, however, personal computers—smaller, less expensive, and more user friendly than mainframes—had become standard equipment in even the smallest offices. Today, most offices would be unable to function without computers, as evidenced by the blackout of August 2003. Without electrical power, most offices from Detroit to New York were forced to close for a few days.

Computers are changing and improving all the time, with faster, smaller, more versatile, and more powerful equipment introduced nearly every week. In the mid-1990s the notebook computer—with the dimensions of a notebook and an average weight of less than six pounds—became very popular, especially with business users who work away from the office. The notebook computer, and the even smaller sub-notebook, fits easily into a briefcase and can work on battery power, making it particularly useful for business travelers. Also available are even smaller palmtop computers and personal digital assistants (PDAs). Wireless components such as keyboards and mice, wireless networks, and high-speed Internet access (called broadband) have become common. Another recent innovation is the capability of computers to listen to and respond to handwritten or voice commands. Thus, for some tasks even the computer keyboard may become obsolete.

Global View: Computers, Business, and Office

U.S. and foreign companies have been doing more and more business in the international marketplace. International agreements, such as the General Agreement on Tariffs and Trade (GATT), the North American Free Trade Association (NAFTA), and the General Agreement on Trades and Services (GATS) have lowered trade barriers. Computer technology, including the Internet, has also made it easier for companies to access markets in different nations. The enormous growth of international business is opening new career and business opportunities to people everywhere.

Rapid advances in computer technology have gone hand in hand with the globalization of business. Computers have made it easier for people in different locations and time zones to communicate. Some banks in New York work around the clock to keep in touch with bankers in London, Tokyo, and other cities around the world. Better communications also help companies sell their products in multiple nations. Entrepreneurs have started many new "dotcom" businesses to take advantage of the international markets that are conveniently accessed via the Internet. Though many of these new Internet companies were folding when the twenty-first century began (some were calling them "dot-bombs"), the future of online business seems wide open.

In addition to expanding global communications, many businesses are physically crossing boundaries. Some companies form strategic alliance relationships that allow companies to share skills and resources with foreign companies. Chrysler, a U.S. auto giant, and Daimler–Benz, a top German auto manufacturer, formed an alliance to enable Chrysler to sell cars in Europe and to improve sales of Daimler–Benz's Mercedes–Benz cars in the United States. Many companies become multinational by building facilities, including factories, in other nations. Chains like the Gap and McDonald's have opened stores on nearly every continent. Big computer companies hire most of their technical support service workers in countries where labor is cheap, such as India and Eastern Europe. The major American automakers have moved many of their production lines to Mexico.

But not everyone is happy about the "Americanization" of the world. A Frenchman who damaged a McDonald's in southern France in 2001 became a hero to the antiglobalization movement. Meetings of the World Trade Organization (WTO) are often marked by protests. Protestors at the 1999 WTO conference in Seattle injured a number of people and caused significant damage to businesses. Another hot topic in international business politics is "sweatshops," factories in foreign countries where consumer goods like clothing and tennis shoes are made much more cheaply than they could be in America. While some people protest against paying foreign workers a fraction of what American workers make, others point out that these same foreign workers are among the highest paid in their homelands. In the United States many people in the manufacturing sector and even in the service industries are upset that more and more jobs are being sent overseas. At the very least, doing business globally requires a sensitivity to these viewpoints.

As businesses increase international activities, they seek people with special skills to help them succeed in the global marketplace. They need accountants, lawyers, and personnel managers who are familiar with the laws, languages, and cultures of the countries where they do business. Corporate bankers and investment professionals must understand how economic conditions abroad affect the cost of foreign loans and the profitability of foreign investments. Another consideration with foreign loans is the likelihood of default, as many poor nations find it difficult to repay loans. Many third-world countries, which otherwise represent promising new markets, are deep in debt. Third-world debt is a rallying cry for some, who think that much of it should be forgiven if these nations are to be solvent again.

Many global businesses also hire experts to teach business customs to managers who work with foreign contacts. In Texas, beginning a meeting with a joke might put an audience at ease, but in Japan, where business is conducted in a more formal manner, coworkers and clients might be offended. In some cases human resources departments prepare employees who are sent abroad for the challenges of living and working in a different culture.

Along with new opportunities, globalization brings special challenges for the years ahead.

Information Processing

Technology has changed the way office work is conducted. The modern office is sometimes referred to as the "electronic office" because of the electronic circuitry within so much of its equipment, including computers, telephones, and copiers. It is hard to identify an office tool that has not been improved by electronics.

The main activity of the electronic office is information processing, which entails gathering, manipulating, storing, and transmitting data. All industries need to process information of some type to keep their operations running smoothly and to facilitate decision making. Information processing has three main areas: telecommunications, word processing, and data processing.

Telecommunications

The word "telecommunications" means sending and receiving messages and data over distances via telephone lines, wireless communications systems, fiber-optic cables, television cable lines, or computer networks. Modern telecommunications encompasses much more than voice telephone calls, although telephone wires are used to transmit a wide variety of messages. Fax machines, for example, use simple telephone wires to transmit printed words and graphics. With electronic mail (e-mail), a computer router or modem transmits information to another computer in an office on the other side of town or in an office on the other side of the world. The most obvious advantage of telecommunications—in contrast to postal mail or overnight delivery services—is that messages often are delivered within seconds. But there are also other advantages, such as the saving of the time and effort required to prepare and print paper mail.

Teleconferencing, another form of telecommunications, enables businesses to conduct meetings among people who are at separate locations. Participants at one site can both see and hear the participants at the other sites via teleprompters.

A company can establish its own information networks within one office or between offices. By linking its computer equipment within the office building, a company establishes a local area network (LAN). Such networks enable employees to communicate more quickly than they could otherwise, which increases productivity. For example, a LAN could allow an employee working at a computer terminal in the human resources department to send the payroll records of a new employee directly to a computer in the payroll department. Through the use of modems and Internet routers, telephone and data lines, and satellites, a company can establish a remote-distance network, or wide area network (WAN). This type of information network allows a company to transmit information instantly to branch offices and plants and to other companies. For example, a chain store in one city can check instantly on the availability of merchandise at the chain's central warehouse in another city hundreds of miles away.

Companies and individuals can obtain a wide variety of information from online services and the Internet. Information available online includes stock market prices, mutual fund rates, airline schedules, hotel reservation rates, and weather reports, as well as many more specialized databases.

Word Processing

Word processing means manipulating alphabetic and numeric characters for various communications purposes. Office workers have always been involved in word processing. Until the introduction of computers and word processing software, however, producing a document often required tedious and time-consuming retyping to make corrections or revisions. With word processing software, text can be added, deleted, corrected, and revised easily, without the need for retyping the entire document. Documents created on a computer can be stored, then retrieved at a later time for revising or copying.

Today, desktop publishing systems enable a single worker to write, edit, lay out, and print documents such as flyers and newsletters. Prior to the development of computer technology, producing such documents required the services of typesetters and printers.

Data Processing

Data processing means gathering, calculating, organizing, sorting, and storing facts and figures. Electronic data processing gives administrators and support personnel immediate access to the information needed to make decisions. It also enables accountants and clerks to quickly and accurately perform tasks such as payroll management and budgeting. Companies use database management programs for many other purposes, such as tracking inventory, maintaining lists of customer names and addresses, sending bills, and generating mass mailings. In addition, businesses use spreadsheet programs to keep track of their financial records.

The Office Environment

Electronic technology changed not only the way work was formerly done in offices but also the environment of the office itself. In general, modern offices are quieter than those of previous eras, because computers, laser printers, and other electronic equipment make much less noise than typewriters and other outmoded office machines did. Electronic documents, such as e-mail and word processor documents, reduced the amount of paper used in offices, so modern offices are usually less cluttered than offices of the past. In addition, today most businesses recognize that a pleasant working environment increases employee productivity, so the modern office is likely to be air-conditioned, carpeted, well lighted, and comfortable. Due to the health risks of secondhand smoke, most businesses now provide a smoke-free office environment.

Telecommuting

Telecommunications technology has created a new class of worker—"telecommuters". These employees work at home using a computer and send their work to the office via the Internet or e-mail. Many companies are experimenting with policies to allow employees to work at home part or most of the time via telecommunications. This is due in part to the Clean Air Act of 1990, which mandates that large companies reduce the number of vehicle miles that their workers travel during each morning rush hour. Allowing employees to telecommute benefits companies by reducing expenses on office space, utilities, and parking. Telecommuting appeals to many workers, including those who have small children, those who value a flexible work schedule, and those who have difficulty commuting because of disabilities.

In May 2004 the U.S. Bureau of Labor Statistics reported in their Current Population Survey that approximately 20.7 million Americans worked part of the time at home either as telecommuters or self-employed workers. Some observers predict that people working from home will play an increasingly significant role in the transactions of American business and that the home might, in fact, become the office of the future.

THE BUSINESS WORK FORCE

Approximately one quarter of the work force in the United States is employed in what is traditionally known as business. According to the Bureau of Labor Statistics' May 2004 Occupational Employment Statistics and Wages survey, there were about 22.6 million administrative support workers, the largest occupational group in the country. Roughly 6.2 million people in management occupations directed these workers.

Management Roles

Managers and administrators are responsible for making decisions about how an organization should be run. Depending on the industry, an administrator's title may be manager, president, chief executive officer (CEO), superintendent, director, consultant, contractor, or one of many others. Administrators typically have general management training as well as training in the specific industry in which they are employed. Many administrators, however, can apply their management skills to a variety of industries.

In most offices administrators are organized into a hierarchy. Top managers are responsible for developing product plans and directing policies and operations. Supervisory managers directly oversee the work of the administrative support staff. Between top managers and supervisory managers are middle managers. Large corporations, in particular, generally depend on a strict organizational hierarchy.

In recent years American managers have begun to change the nature of their organizational hierarchies. Large corporations are finding that they can respond to economic changes and develop products faster if they have fewer layers of managers. Consequently, many companies are laying off administrators to make a leaner organization. Middle management has been hardest hit by this trend.

As might be expected, downsizing—the process of creating smaller companies through job layoffs—has caused hardships. Former middle managers, most of whom are middle-aged, have had difficulty finding new positions suitable to their skills and experience. After many years of work many ex-managers also have difficulty retraining themselves for new careers. Companies, too, must face the problem of how to motivate their remaining managers. Often these employees must assume a heavier workload without the traditional incentives of clearly defined promotion or higher pay.

Supporting Roles

Administrative support personnel perform the day-to-day tasks that help a business run smoothly, such as maintaining files, answering phones, paying bills, and dealing with correspondence and orders. Their job titles include secretary, receptionist, administrative assistant, word processor, clerk, and teller.

Today's offices need many of the same administrative support personnel, such as bookkeepers, clerks, and secretaries, that traditional offices needed. Many of the responsibilities of these workers have remained the same, but the ways in which they perform their jobs have changed dramatically. Although new office machines and computers eliminated the need for some jobs and reduced the time required to do others, they also created entirely new jobs—such as computer programmer—that did not exist previously. In addition, automation created new departments that offer substantial advancement opportunities. For example, almost all medium-sized and large companies have their own data processing departments. A worker who starts out as a computer operator in a data processing department may, with experience and additional training, become the manager of the department.

Because automation has significantly reduced the amount of time required to perform many tasks, office workers may have more time and freedom to take on tasks that were once reserved for lower-level managers. They may be asked to train and supervise other office workers, edit and proofread a company newsletter, or plan and arrange a business trip. In this way, automation has generally upgraded the status and image of office workers and made their work more challenging and interesting than it used to be.

Office automation is not without its drawbacks, however. Office workers in an automated office usually have less face-to-face contact with their coworkers than did their counterparts in a traditional business office. Sometimes office workers may be expected to perform one specific task, such as word processing or data entry, rather than being able to perform a variety of jobs.

TRENDS IN BUSINESS

Business, perhaps more than any other sector of society besides medicine, was transformed by the technological innovations of the late twentieth century. The development of computers and the evolution of new management theories—started in the computer hardware and software industries—brought about the growth of the "Information Society." These new technologies and management theories contributed greatly to the expansion of certain areas of business, including the service sector, the temporary help industry, computer consulting, and management consulting.

The Service Sector

The United States government and many business analysts predict that most of the employment growth in this country will occur in businesses that provide services rather than in businesses that produce goods. These businesses sell a service, rather than a manufactured product, for profit. The Bureau of Labor Statistics predicted in their 2004–14 employment projections that 18.9 million new jobs would be created through 2014. Of those jobs, more than 18.7 million were projected to be in the service sector, and none were expected in the goods-producing sector.

In the past, "service" was usually a straightforward activity, such as hair styling or auto repair. Now, however, the service sector of the economy grows more vast and complex every day. Although the service industry still includes traditional services, it has grown to encompass businesses as varied as small day care centers and huge software corporations.

Because this diversity can cause confusion, many economists propose that a third job sector—information—be added to goods and services. The information sector would include software companies, most financial services, publishers, and the many other businesses that provide, move, or manipulate information.

The Temporary Help Industry

As companies have downsized and sought to reduce their overhead costs, corporate payrolls have shrunk accordingly. However, the need to meet the challenge of increased competition and productivity has grown. Consequently, many companies rely on temporary workers.

Temporary workers have varied backgrounds and work histories. Some are displaced workers who were laid off. Others are people who enjoy the flexibility of working on an assignment basis. Many temporary workers want full-time employment, usually because better benefits (such as medical insurance, sick days, and paid vacations) accompany it. These benefits are costly to an employer, however, and have become one of the main reasons that companies hesitate to take on too many full-time employees. A temporary assignment offers the employer and the employee a chance to screen each other and may result in a full-time position.

The temporary help industry is thriving and is expected to continue to grow. Although most temporary help firms still place only clerical workers, others are discovering that they can serve highly specialized markets. The placement of science and engineering professionals in temporary jobs has become an important source of revenue for the temporary help industry.

As the demand for skilled temporary workers grows, temporary agencies are trying to make temporary work as attractive as possible. Some offer health insurance at reduced cost to the employee, making it easier for workers to remain temporary. Many agencies provide training to teach valuable new skills.

Computer Services

The growth of the computer service industry has slowed down substantially since the high-tech explosion of the late 1990s. After the burst of the "dot-com" bubble, many lower level computer jobs, such as technical support specialist and programmer, were shipped overseas, and the amount of money large companies invested in computer technology leveled off. Yet, even with these setbacks, the industry as a whole continues to thrive. Employment of computer specialists was expected to increase 31.4 percent through the year 2014, according to the Bureau of Labor Statistics. Overall, high-level computer specialists, such as security specialists, should be in greater demand than low-level computer specialists, such as computer programmers. Employment of network systems analysts and computer software engineers was predicted to increase the fastest by 2014, rising 54.6 percent and 48.4 percent, respectively.

Computer specialists working for computer systems design and related services, in particular, should have the greatest opportunities and the highest salaries. Firms in the computer systems design industry help companies to set up Web sites, networks, computer databases, and other information technology systems. These firms usually send a team of specialists out to first design and then build or implement changes to the client's computer systems. In their 2006–07 Career Guide to Industries, the Bureau of Labor Statistics reported that employment in computer design firms was expected to grow 39.5 percent though the year 2014.

Management Consulting

There has been tremendous growth in the number and variety of management consultants in the American economy as well. During the economic recession in the late 1980s and early 1990s, many high-level executives were released from their contracts at major consulting firms or laid off from corporations. Some of these experienced professionals formed their own small consulting firms, usually specializing in one particular area of expertise such as management analysis. According to the Bureau of Labor Statistics, management, scientific, and technical consulting services were projected to experience a 60.5 percent increase in employment growth through the year 2014.

One area where management consultants will be in high demand is in facilities management, or "outsourcing." Outsourcing refers to a company's practice of focusing on its principal activities and hiring outside specialists to perform supportive business activities such as accounting, telecommunications, and human resources.

THE WORLD OF FINANCE

Many employment opportunities exist in businesses providing financial services. The fields involved in finance include banking, investment, accounting, and insurance. Most workers in these fields hold administrative or administrative support positions. According to the Bureau of Labor Statistics' May 2004 Occupational Employment Statistics survey, some 5.1 million workers were employed in the business and financial operations occupations.

Banks

Years ago, bank business was conducted Monday through Friday from 9 a.m. to 3 p.m. Bank jobs were thought to be comfortable, steady, and secure. Hence, the phrase "banker's hours" referred to jobs that were fairly easy and did not require too much of a person's time. This comparison is no longer valid, however. Today banking is a fiercely competitive, complex business, conducted around the clock.

The U.S. banking industry has had its share of ups and downs in recent years. At the beginning of the 1990s the banking industry was in serious trouble. Hundreds of commercial banks had gone out of business, and profits at the nation's top banks plummeted. Economic downturns and large losses on foreign loans and real estate loans were contributing factors in the banking industry's problems. Banks also felt competitive pressure from investment firms, insurance companies, pension funds, and corporations. During the 1980s federal deregulation allowed nonbank organizations to offer financial services that had previously been the exclusive domain of banks. These services included checking and savings accounts, loans, and credit cards. Further deregulation by Congress in 1999 allowed banks more inroads into the financial services industry, allowing them to sell stocks and bonds, insurance policies, and mutual funds.

Whereas nonbank companies have been assuming traditional banking functions since the 1980s, commercial banks have only been as free to move into nonbank businesses since the turn of the century. Largely as a result of this situation, the banking industry's dominance of finance has declined. Many bank customers still do not regard banks as a place to go for anything other than checking and savings accounts, CDs, and mortgages. Banks, however, are fighting to remain competitive in several ways.

Mergers

To cut operation costs and offset competition, many banks have merged and laid off thousands of workers in the process. Regional banks have banded together to form super-regionals. Small community banks will not disappear altogether, however, because there will always be areas where "mega-banks" choose not to establish offices.

Additional Services

In the competition for consumer dollars, banks are developing and aggressively marketing new products and offering additional services. For example, bank customers can choose from a wide array of checking accounts, annuities, certificates of deposit, credit cards, buyer protection insurance on checking accounts, telephone and online transaction services, stocks and bonds, and much more. Bank tellers are often told to sell such services to customers who have a lot of money deposited with the bank.

Industry Snapshots

COMPUTER SERVICES

The computer services industry encompasses an incredibly diverse group of companies. Computer talent is in great demand as companies worldwide seek to automate their offices and factories and keep pace with rapid advances in technology. Computer specialist occupations were projected to be among the fastest growing in the economy, with employment expected to increase 31.4 percent through the year 2014, according to the Bureau of Labor Statistics.

MANAGEMENT CONSULTING

In an ever-changing marketplace, many businesses find that they need expert help to restructure their organizations, develop quality-control procedures, and manage employees. Although the management consulting industry will continue to grow throughout the twenty-first century, the rapid proliferation of consulting firms has sparked intense competition for market share. To ensure survival, firms have expanded their range of services and their areas of specialty in hopes of securing a market niche. Consulting will be one of the fastest-growing industries in coming years. According to the Bureau of Labor Statistics, management, scientific, and technical consulting services are expected to experience a 60.5 percent increase in employment growth through the year 2014. The only industry expected to grow faster was the home health care industry.

TEMPORARY HELP

Employment in agencies placing temporary workers was estimated to increase by more than 45 percent through the year 2014, with nearly 1.5 million new jobs being created, according to Bureau of Labor Statistics projections. Companies that are downsizing and streamlining their operations strive to save money in employee benefits and wages by using more temporary workers. The tremendous growth in the temporary help industry represents a major trend away from long-term job security in the United States.

FINANCE

After a period of expansion and volatility in the 1980s, investment firms have adopted a more conservative outlook. They continue to look to new markets, however, especially international ones. Investment firms have become one of the healthiest industries within the financial sector, and they are considered one of the country's faster-growing industries. A successful investment firm needs a skillful sales force, well versed in computer technology, to compete for consumers' investment dollars. Employment for financial services and investment industry was expected to grow 15.8 percent through the year 2014, according to the Bureau of Labor Statistics.

INSURANCE

To gain financial momentum in the new millennium, insurance companies are expanding overseas, finding specialized markets, and developing new products to meet the needs of a changing population. The skyrocketing cost of insurance, especially health insurance, will continue to be an important public policy issue. Employment in this field was expected to grow by 9.5 percent, or by 215,000 jobs, through the year 2014, according to the Bureau of Labor Statistics.

ACCOUNTING

Public accounting is dominated by a handful of large firms. These firms are competing against one another for clients in the United States and around the world. Accountants are becoming increasingly important in business management. In their 2004–14 projections, the Bureau of Labor Statistics forecasted that about 264,000 jobs in accounting and auditing would be added to the labor market through the year 2014, which would represent a 0.9 percent increase.

BANKING

The distinction between commercial banks and other financial institutions is blurring. Faced with competition from investment firms and insurance companies, banks are developing new products and services. Many banks have merged as a result of competition. Employment in banking was forecasted to decline by 1.8 percent, according to the Bureau of Labor Statistics.

New Technology

Virtually every bank in existence uses computers and other electronic equipment to speed check-handling transactions and other services. Electronic funds transfer (EFT), an even more advanced system, may eventually eliminate the use of checks entirely. EFT automatically transfers money from one account to another, as in the case of automated teller machines (ATMs), which allow customers to do their banking twenty-four hours a day, seven days a week. EFT also allows people to automatically transfer money for regular payments (such as mortgage payments or utility bills) from their accounts to the biller's account. Many banks also offer consumers the opportunity to conduct their banking online, using personal computers and modems to deposit and transfer funds. Services such as online banking allow smaller banks, which have fewer branch offices, to compete with larger banks. In 2005, some 44 percent of Americans with a personal computer at home used it for banking online, according to a February 2005 data memo from the Pew Internet and American Life Project.

Alternative Work Styles in Computers, Business, and Office

TELECOMMUTING

Telecommuting allows employees to work at home on a computer connected to an office computer network. Many employees are more productive when they spend some or all of their time working at home. Telecommuting offers opportunities for the disabled or for parents of young children who need to be at home. It also allows employees to live farther from the office. Some workers who telecommute include:

• computer programmers
• computer software documentation writers
• insurance underwriters
• tax preparers
• operations research analysts

FREELANCING

Freelancing is done by workers who produce projects or provide services for one or more clients. They are not permanently employed by any one client but are paid for each assignment on an hourly basis or at a fixed rate. Freelancers frequently must spend part of their time looking for clients and assignments. Some workers doing freelance work include:

• meeting planners
• accountants
• computer consultants
• computer systems analysts
• tax preparers
• office planners
• training and development specialists

JOB SHARING

Job sharing allows two or more people to hold one full-time position. Responsibilities, salary, and benefits are all shared. A time schedule is established to fulfill job requirements and meet employee needs. Job sharers should enjoy working on a team, and they need to be flexible and well organized. Some workers involved in job sharing include:

• secretaries
• administrative assistants
• correspondence clerks
• computer and office machine repairers

FLEXTIME

Flextime allows workers to adjust work hours to suit personal needs. The total number of hours in the week remains the same. Flextime can also mean a change in workdays, such as four ten-hour days or six short days. Some workers on flextime schedules include:

• receptionists
• file clerks
• mail clerks
• claims adjusters
• employment interviewers
• data entry keyers

TEMPORARY EMPLOYMENT

Temporary workers generally receive their assignments through temporary employment agencies. They work for firms that require additional help on an occasional basis. They receive an hourly rate of pay for the time they work. Assignments differ in length and location, offering some variety. Among temporary workers are:

• secretaries
• word processors
• messenger service workers
• computer programmers

Investment Firms

The 1980s were a heady decade for investment firms. The sale of stocks, bonds, and other securities soared. Investment firms expanded greatly, hiring staff and opening branch offices in the United States and abroad. In October 1987, however, a stock market crash led many investment firms to lay off staff and adopt a more conservative and serious style. The mid-1990s saw one of the longest stock market expansions in history, fueled primarily by the growth of mutual funds. As the twenty-first century began, however, the stock market was falling, and it fell even more after September 11, 2001. By 2006 the market had made a substantial recovery, but many stocks still hadn't reached their 1990 prices, especially in the high-tech industry.

In 2001 the investment business was in crisis for another reason—declining investor confidence. Large companies like Enron and Global Crossing folded, leaving ordinary shareholders with large losses that company executives had avoided by selling off stock before the collapse. Some of the largest investment firms were indicted for fraud when they recommended failing companies' stock to investors in order to set up profitable stock offerings with the companies. At the heart of the crisis was the dual nature of such investment firms, which both recommend stocks to investors and underwrite them. This potential conflict of interest was behind many reforms.

Despite the current economic slump and crisis in confidence, the investment business is still one of the fastest-growing industries within the financial sector. Employment for financial services and investment industry was expected to grow 15.8 percent through the year 2014, according to the Bureau of Labor Statistics. Workers in this field will need to have the latest computer skills and varying degrees of knowledge regarding the emerging global market. In addition, many brokerage firms have enlarged their sales and research departments in an attempt to remain competitive with rival firms, banks, and nonfinancial institutions. Stock and bond trading, as well as other investing, can now be done online.

Accounting Firms

According to the Bureau of Labor Statistics, there were more than 1.2 million accountants and auditors in the United States in 2004, most of whom were employed in the corporate sector. Even in bad economic times, businesses must keep financial records and pay taxes. Consequently, job prospects in accounting remain bright. In recent years there has been an increased demand for accountants, due in part to more complicated tax rules and business regulations. It was estimated in the Bureau of Labor Statistics projections that about 264,000 jobs in accounting and auditing would be added to the labor market through the year 2014.

Some accountants work as part of the administrative staff of businesses or government agencies. Others—known as public accountants—work for firms that supply accounting services to businesses. At the beginning of the twenty-first century, the field of public accounting was dominated by a handful of huge companies. These firms offer one of the fastest-growing areas of employment.

Because computer spreadsheets now do much of the actual calculating required in accounting, today's accountants do more than balance daily ledgers. Accountants have become increasingly important in helping to manage businesses. They use financial information to analyze a company's needs, solve problems, and make projections. Accountants with specializations such as bankruptcy, debt restructuring, benefits consulting, corporate reorganization, and fraud investigation are especially valuable to businesses.

The corporate accounting business suffered an image crisis in 2001, when Arthur Andersen, one of the Big Five accounting firms, was indicted for fraud for its role in the Enron scandal. Instead of exposing financial trouble spots in the failing Enron's books, the Arthur Andersen staff admitted to concealing losses to curry favor with its client. As a result, Andersen went out of business. History shows that accountants and auditors must be objective if they want long-term success.

The Insurance Industry

The insurance industry is made up of three main branches: life insurance, health insurance, and property and liability insurance. In the recent past, the U.S. insurance industry endured both good and bad times. In the 1990s insurance companies were trying a number of tactics to regain a strong financial position. One tactic was to diversify products or to find a specialized niche within the insurance market. Some companies specialized in an area related to insurance, such as benefits counseling or financial and risk management. A second tactic was to develop new products. Many of these new products were aimed at senior citizens, who represent a large market. Yet another tactic was to develop an international market. Companies could do this by establishing offices or divisions overseas or by buying established insurance companies in foreign countries.

Medical Insurance Crisis

One major problem that the insurance industry has had to contend with is the skyrocketing cost and the increasing complexities of insurance coverage. The problem is especially acute in the area of medical insurance. Medical insurance has become so expensive that millions of Americans cannot afford medical coverage.

Although solutions to this insurance crisis are not easy, the industry is making some attempts to control premium rates. For example, many health and life insurance companies are switching to or emphasizing managed care. Managed-care services include helping policyholders find the lowest-cost health provider, negotiating with medical-care providers for lower costs, and checking on the necessity of certain medical procedures. Often in these systems, referred to as health maintenance organizations (HMOs), the patient has a limited choice of primary care physicians. Only a primary care physician can determine if a patient should see a specialist. Many patients complain about the lack of choice when selecting doctors under managed-care plans. Many also find that some expensive treatments are not covered under their HMO plan.

The Use of Computers

Computers have greatly affected all industries, and the insurance industry is no exception. Online computer networks link branch offices of insurance companies, greatly decreasing the amount of time that used to be needed to process policies, claims, and service inquiries. The use of computers saves insurance companies both time and money and enables them to offer their clients more efficient service.

Employment Opportunities in Insurance

The insurance industry is one of the largest employers in the country, and future prospects are good. Employment in this field was expected to grow by 226,000 jobs through the year 2014, according to the Bureau of Labor Statistics. Although approximately half of the insurance positions are clerical, career mobility is often swift. Those new to the field might consider specializing in areas such as international business insurance, workers' compensation, and product and pollution liability.

A LOOK INTO THE FUTURE

Throughout the early twenty-first century, jobs in computers, business, and the office will most likely be characterized by the same far-reaching trends affecting the entire economy. These trends include constantly evolving computer technology, an expanding global marketplace (aided in part by trade agreements such as NAFTA and GATT), and a shift toward an information-oriented society. These trends will require workers to seek continuing education and to improve and expand their skills. More than ever, workers who are versatile and can adapt to changing needs will be in demand.

Growth in Employment

The expanding computer and data processing services industry will offer increasing opportunities for computer specialists, although the demand for computer programmers and technical support specialists will not be as great as that for computer software engineers, computer systems analysts, database administrators, and network administrators. Computer technology has led to the near-elimination of jobs for stenographers and statistical clerks, and virtually all typing is now done on computers. Any workers in business, administration, or office occupations who do not achieve computer literacy will find their employment options severely limited.

Through the year 2014, employment in the human resources field was expected to increase by more than 18 percent, according to the Bureau of Labor Statistics. A constantly changing workplace will create a demand for people who can attract skilled workers, place them in positions best suited to their talents and the company's goals, and manage their training, benefits, and problems. Employment for management consultants, particularly in the human resources field, should also increase faster than average as more companies hire consultants to perform tasks previously assigned to middle managers. In addition, the number of receptionists and information clerks, whose work is not easily automated, was expected to rise 21.4 percent through the year 2014. These positions should occur in fast-growing industries such as business services.

The Evolving Workplace

The American workforce will most likely grow more ethnically diverse in the next century. In their 2014 projections the Bureau of Labor Statistics estimated that white workers would comprise 80.2 percent of the total workforce by 2014, a 4.6-percentage-point decrease from 1994. By 2014 the Hispanic labor force was projected to grow faster than the African-American labor force, primarily because of faster population growth. The Asian-American labor force was expected to equal more than 5 percent of the total labor force. The number of women in the workforce was expected to increase from 46.4 percent in 2004 to 46.8 percent by 2014. In addition, the baby boomer generation is aging. Compared with young workers, the pool of experienced workers should increase. It was projected that the median age of the American worker should be 41.6 years in 2014, compared with 37.7 years in 1994.

Competition for jobs in the computers, business, and office workplace will be high in the twenty-first century, and education and specialized training will increasingly become the norm. Projected rates of employment growth are faster than average for occupations requiring a college degree or other postsecondary education or training. The trend toward higher education is expected to continue. Whereas a high school diploma is required even for most entry-level jobs, a college degree is necessary for higher-level business jobs. In addition, even after a person starts working, further education, training, and retraining are essential to keeping up with and adapting to new developments in the ever-changing world of business.

These continual changes in the workplace, workers' roles, and the skills required of workers are both exciting and challenging. The workplace of the future may be far different from the one we have known. Nevertheless, opportunities in the business world abound for those ready to face new challenges.