Professions – We Know Zero

We may be missing where the action is likely to be in the so-called Fourth Industrial Revolution

08. September 2025 · 4 comments · Categories: Actuarial, Demographics, Economics, Media & Politics, Professions

*Title page vignette of Hard Times by Charles Dickens. Thomas Gradgrind Apprehends His Children Louisa and Tom at the Circus, 1870*

It was Fredric Jameson (according to Owen Hatherley in the New Statesman) who first said:

“It seems to be easier for us today to imagine the thoroughgoing deterioration of the earth and of nature than the breakdown of late capitalism”. I was reminded of this by my reading this week.

It all started when I began watching Shifty, Adam Curtis’ latest set of films on iPlayer aiming to convey a sense of shifting power structures and where they might lead. Alongside the startling revelation that The Land of Make Believe by Bucks Fizz was written as an anti-Thatcher protest song, there was a short clip of Eric Hobsbawm talking about all of the words which needed to be invented in the late 18th century and early 19th to allow people to discuss the rise of capitalism and its implications. So I picked up a copy of his The Age of Revolution 1789-1848 to look into this a little further.

The first chapter of Hobsbawm’s introduction from 1962, the year of my birth, expanded on the list:

Words are witnesses which often speak louder than documents. Let us consider a few English words which were invented, or gained their modern meanings, substantially in the period of sixty years with
which this volume deals. They are such words as ‘industry’, ‘industrialist’, ‘factory’, ‘middle class’, ‘working class’, ‘capitalism’ and ‘socialism’. They include ‘aristocracy’ as well as ‘railway’, ‘liberal’ and
‘conservative’ as political terms, ‘nationality’, ‘scientist’ and ‘engineer’, ‘proletariat’ and (economic) ‘crisis’. ‘Utilitarian’ and ‘statistics’, ‘sociology’ and several other names of modern sciences, ‘journalism’ and ‘ideology’, are all coinages or adaptations of this period. So is ‘strike’ and ‘pauperism’.

What is striking about these words is how they frame most of our economic and political discussions still. The term “middle class” originated in 1812. Noone referred to an “industrial revolution” until English and French socialists did in the 1820s, despite what it described having been in progress since at least the 1780s.

Today the founder of the World Economic Forum has coined the phrase “Fourth Industrial Revolution” or 4IR or Industry 4.0 for those who prefer something snappier. Its blurb is positively messianic:

The Fourth Industrial Revolution represents a fundamental change in the way we live, work and relate to one another. It is a new chapter in human development, enabled by extraordinary technology advances commensurate with those of the first, second and third industrial revolutions. These advances are merging the physical, digital and biological worlds in ways that create both huge promise and potential peril. The speed, breadth and depth of this revolution is forcing us to rethink how countries develop, how organisations create value and even what it means to be human. The Fourth Industrial Revolution is about more than just technology-driven change; it is an opportunity to help everyone, including leaders, policy-makers and people from all income groups and nations, to harness converging technologies in order to create an inclusive, human-centred future. The real opportunity is to look beyond technology, and find ways to give the greatest number of people the ability to positively impact their families, organisations and communities.

Note that, despite the slight concession in the last couple of sentences that an industrial revolution is about more then technology-driven change, they are clear that the technology is the main thing. It is also confused: is the future they see one in which “technology advances merge the physical, digital and biological worlds” to such an extent that we have “to rethink” what it “means to be human”? Or are we creating an “inclusive, human-centred future”?

Hobsbawm describes why utilitarianism (” the greatest happiness of the greatest number”) never really took off amongst the newly created middle class, who rejected Hobbes in favour of Locke because “he at least put private property beyond the range of interference and attack as the most basic of ‘natural rights'”, whereas Hobbes would have seen it as just another form of utility. This then led to this natural order of property ownership being woven into the reassuring (for property owners) political economy of Adam Smith and the natural social order arising from “sovereign individuals of a certain psychological constitution pursuing their self-interest in competition with one another”. This was of course the underpinning theory of capitalism.

Hobsbawm then describes the society of Britain in the 1840s in the following terms:

A pietistic protestantism, rigid, self-righteous, unintellectual, obsessed with puritan morality to the point where hypocrisy was its automatic companion, dominated this desolate epoch.

In 1851 access to the professions in Britain was extremely limited, requiring long years of education to support oneself through and opportunities to do so which were rare. There were 16,000 lawyers (not counting judges) but only 1,700 law students. There were 17,000 physicians and surgeons and 3,500 medical students and assistants. The UK population in 1851 was around 27 million. Compare these numbers to the relatively tiny actuarial profession in the UK today, with around 19,000 members overall in the UK.

The only real opening to the professions for many was therefore teaching. In Britain “76,000 men and women in 1851 described themselves as schoolmasters/mistresses or general teachers, not to mention the 20,000 or so governesses, the well-known last resource of penniless educated girls unable or unwilling to earn their living in less respectable ways”.

Admittedly most professions were only just establishing themselves in the 1840s. My own, despite actuarial activity getting off the ground in earnest with Edmund Halley’s demonstration of how the terms of the English Government’s life annuities issue of 1692 were more generous than it realised, did not form the Institute of Actuaries (now part of the Institute and Faculty of Actuaries) until 1848. The Pharmaceutical Society of Great Britain (now the Royal Pharmaceutical Society) was formed in 1841. The Royal College of Veterinary Surgeons was established by royal charter in 1844. The Royal Institute of British Architects (RIBA) was founded in 1834. The Society of Telegraph Engineers, later the Institute of Electrical Engineers (now part of the Institute of Engineering and Technology), was formed in 1871. The Edinburgh Society of Accountants and the Glasgow Institute of Accountants and Actuaries were granted royal charters in the mid 1850s, before England’s various accounting institutes merged into the Institute of Chartered Accountants in England and Wales in 1880.

However “for every man who moved up into the business classes, a greater number necessarily moved down. In the second place economic independence required technical qualifications, attitudes of mind, or financial resources (however modest) which were simply not in the possession of most men and women.” As Hobsbawm goes on to say, it was a system which:

…trod the unvirtuous, the weak, the sinful (i.e. those who neither made money nor controlled their emotional or financial expenditures) into the mud where they so plainly belonged, deserving at best only of their betters’ charity. There was some capitalist economic sense in this. Small entrepreneurs had to plough back much of their profits into the business if they were to become big entrepreneurs. The masses of new proletarians had to be broken into the industrial rhythm of labour by the most draconic labour discipline, or left to rot if they would not accept it. And yet even today the heart contracts at the sight of the landscape constructed by that generation.

This was the landscape upon which the professions alongside much else of our modern world were constructed. The industrial revolution is often presented in a way that suggests that technical innovations were its main driver, but Hobsbawm shows us that this was not so. As he says:

Fortunately few intellectual refinements were necessary to make the Industrial Revolution. Its technical inventions were exceedingly modest, and in no way beyond the scope of intelligent artisans experimenting in their workshops, or of the constructive capacities of carpenters, millwrights and locksmiths: the flying shuttle, the spinning jenny, the mule. Even its scientifically most sophisticated machine, James Watt’s rotary steam-engine (1784), required no more physics than had been available for the best part of a century—the proper theory of steam engines was only developed ex post facto by the Frenchman Carnot in the 1820s—and could build on several generations of practical employment for steam engines, mostly in mines.

What it did require though was the obliteration of alternatives for the vast majority of people to “the industrial rhythm of labour” and a radical reinvention of the language.

These are not easy things to accomplish which is why we cannot easily imagine the breakdown of late capitalism. However if we focus on AI etc as the drivers of the next industrial revolution, we will probably be missing where the action really is.

If we don’t have a goal, the means take over

03. September 2025 · Write a comment · Categories: Economics, Media & Politics, Professions, Science Fiction

I have just been reading Adrian Tchaikovsky’s Service Model. I am sure I will think about it often for years to come.

Imagine a world where “Everything was piles. Piles of bricks and shattered lumps of concrete and twisted rods of rebar. Enough fine-ground fragments of glass to make a whole razory beach. Shards of fragmented plastic like tiny blunted knives. A pall of ashen dust. And, to this very throne of entropy, someone had brought more junk.”

This is Earth outside a few remaining enclaves. And all served by robots, millions of robots.

Robots: like our protagonist (although he would firmly resist such a designation) Uncharles, who has been programmed to be a valet, or gentleman’s gentlerobot; or librarians tasked with preserving as much data from destruction or unauthorised editing as possible; or robots preventing truancy from the Conservation Farm Project where some of the few remaining humans are conscripted to reenact human life before robots; or the fix-it robots; or the warrior robots prosecuting endless wars.

Uncharles, after slitting the throat of his human master for no reason that he can discern, travels this landscape with his hard-to-define-and-impossible to-shut-up companion The Wonk, who is very good at getting into places but often not so good at extracting herself. Until they finally arrive in God’s waiting room and take a number.

Along the way The Wonk attempts to get Uncharles to accept that he has been infected with a Protagonist Virus, which has given Uncharles free will. And Uncharles finds his prognosis routines increasingly unhelpful to him as he struggles to square the world he is perambulating with the internal model of it he carries inside him.

The questions that bounce back between our two unauthorised heroes are many and various, but revolve around:

Is there meaning beyond completing your task list or fulfilling the function for which you were programmed?
What is the purpose of a gentleman’s gentlerobot when there are no gentlemen left?
Is the appearance of emotion in some of Uncharles’ actions and communications really just an increasingly desperate attempt to reduce inefficient levels of processing time? Or is the Protagonist Virus an actual thing?

Ultimately the question is: what is it all for? And when they finally arrive in front of God, the question is thrown back at us, the pile of dead humans rotting across the landscape of all our trash.

This got me thinking about a few things in a different way. One of these was AI.

Suppose AI is half as useful as OpenAI and others are telling us it will be. Suppose that we can do all of these tasks in less than half the time. How is all of that extra time going to be distributed? In 1930 Keynes speculated that his grandchildren would only need to work a 15 hour week. And all of the productivity improvements he assumed in doing so have happened. Yes still full-time work remains the aspiration.

There certainly seems to have been a change of attitude from around 1980 onwards, with those who could choose choosing to work longer, for various reasons which economists are still arguing about, and therefore the hours lost were from those who couldn’t choose, as The Resolution Foundation have pointed out. Unfortunately neither their pay, nor their quality of work, have increased sufficiently for those hours to meet their needs.

So, rather than asking where the hours have gone, it probably makes more sense to ask where the money has gone. And I think we all know the answer to that one.

When Uncharles and The Wonk finally get in to see God, God gives an example of a seat designed to stop vagrants sleeping on it as the indication it needed of the kind of society humans wanted. One where the rich wanted not to have to see or think about the poor. Replacing all human contact with eternally indefatigable and keen-to-serve robots was the world that resulted.

Look at us clever humans, constantly dreaming of ways to increase our efficiency, remove inefficient human interaction, or indeed any interaction which cannot be predicted in advance. Uncharles’ seemingly emotional responses, when he rises above the sea of task-queue-clutching robots all around him, are to what he sees as inefficiency. But what should be the goal? Increasing GDP can’t be it, that is just another means. We are currently working extremely hard and using a huge proportion of news and political affairs airtime and focus on turning the English Channel into the seaborne equivalent of the seat where vagrants and/or migrants cannot rest.

So what should be the goal? Because the reason Service Model will stay with me for some time to come is that it shows us what happens if we don’t have one. The means take over. It seems appropriate to leave the last word to a robot.

“Justice is a human-made thing that means what humans wish it to mean and does not exist at all if humans do not make it,” Uncharles says at one point. “I suggest that ‘kind and ordered’ is a better goal.”

Generational victim blaming

13. August 2025 · Write a comment · Categories: Media & Politics, Pensions, Professions

Last time I suggested that the changes to graduate recruitment patterns, due at least in part to technological change, appeared to be to the disadvantage of current graduates, both in terms of number of vacancies and in what they were being asked to do.

This immediately reminds me of the old Woody Allen joke from the opening monologue to Annie Hall:

Two elderly women are at a Catskills mountain resort, and one of ’em says: “Boy, the food at this place is really terrible.” The other one says, “Yeah, I know, and such … small portions.”

This would clearly be an uncomfortable position for Corporate Britain if it were accepted. So a push back is to be expected. The drop in graduate vacancies is hard to challenge so the next candidate is obviously the candidates themselves.

So hot on the heels of “Kids today need more discipline”, “Nobody wants to work”, “Students today aren’t prepared for college”, “Kids today are lazy”, “We are raising a generation of wimps” and “Kids today have too much freedom” (I refer you to Paul Fairie’s excellent collections of newspaper reports through history detailing these findings at regular intervals), we now have the FT, newspaper of choice for Corporate Britain, weighing in on “The Troubling Decline in Conscientiousness“, this time backed up by a whole series of graphs:

John Burn-Murdoch does a lot of great data work on a huge array of subjects which I have referred to often, but I find the quoted studies problematic for a number of reasons. First of all, there is the suspicion that young people have already been found guilty before looking for evidence to back this up. For instance, which came first here the “factors at work” or the “shifts”?

While a full explanation of these shifts requires thorough investigation, and there will be many factors at work, smartphones and streaming services seem likely culprits.

At one point John feels compelled to say:

While the terminology of personality can feel vague, the science is solid.

At which point he links to this study, defending the five-factor model of personality as a “biologically based human universal” which terrifies me a little. Now of course there are always studies pointing in lots of different directions for any piece of social science research and this is no exception. In this critique of the five-factor model (FFM), for instance, we find that:

While the two largest factors (Anxiety/Neuroticism and Extraversion) appear to have been universally accepted (e.g., in the pioneering factor-analytic work of R. B. Cattell, H. J. Eysenck, J. P. Guilford, and A. L. Comrey), the present critique suggests, nevertheless, that the FFM provides a less than optimal account of human personality structure.

I first saw the FT article via a post on LinkedIn, where there was one mild push back sitting alone amongst crowds of pile ons from people of my generation. After all it feels right, doesn’t it? But Chris Wagstaff, Senior Visiting Fellow at Bayes Business School, was spot on I feel, when he pointed out four potential behavioural biases at play here within the organisations where these young people are working:

The decline in conscientiousness and some of the other traits identified could be a consequence of more senior colleagues not inviting or taking on board constructive challenge from younger colleagues, the calamity of conformity, i.e. groupthink, so demotivating the latter.
Related to this is the tendency for many organisations to get their employees to live and breathe an often meaningless set of values and adhere to a blinkered way of doing things. Again, hugely frustrating and demotivating.
Or perhaps we’re seeing way too many meetings being populated by way too many participants, meaning social loafing (ie when individual performance isn’t visible they simply hide behind others) is on the increase.
Finally, remuneration structures might discourage entrepreneurial thinking and an element of risk taking (younger folk are less risk averse than older folk). Again, very demotivating.

These sound much more convincing “factors at play” to me than smart phones or streaming services, neither of which of course are the preserve of the young. But demonising the young is an essential prelude to feeling better about denying them work or forcing them into some kind of reverse centaur position.

Corporate Britain needs to do better than pseudo-scientific victim blaming. There are real issues here around the next generation’s relationship with work and much else which need to be met head on. Your future pension income may depend upon it.

The Early Career Professional and the Reverse Centaur

07. August 2025 · Write a comment · Categories: Actuarial, Cartoons, Professions, Science Fiction

In a previous post, I mentioned the “diamond model” that accountancy firms are reportedly starting to talk about. The impact so far looks pretty devastating for graduates seeking work:

And then by industry:

Meanwhile, Microsoft have recently produced a report into the occupational implications of generative AI and their top 40 vulnerable roles looks like this (look at where data scientist, mathematician and management analyst sit – all noticeably more replaceable by AI than model which caused all the headlines when Vogue did it last week):

So this looks like a process well underway rather than a theoretical one for the future. But I want to imagine a few years ahead. Imagine that this process has continued to gut what we now regard as entry level jobs and that the warning of Dario Amodei, CEO of AI company Anthropic, that half of “administrative, managerial and tech jobs for people under 30” could be gone in 5 years, has come to pass. What then?

Well this is where it gets interesting (for some excellent speculative fiction about this, the short story Human Resources and novel Service Model by Adrian Tchaikovsky will certainly give you something to think about), because there will still be a much smaller number of jobs in these roles. They will be very competitive. Perhaps we will see FBI kind of recruitment processes becoming more common for the rarified few, probably administered by the increasingly capable systems I discuss below. They will be paid a lot more. However, as Cory Doctorow describes here, the misery of being the human in the loop for an AI system designed to produce output where errors are hard to spot and therefore to stop (Doctorow calls them, “reverse centaurs”, ie humans have become the horse part) includes being the ready made scapegoat (or “moral crumple zone” or “accountability sink“) for when they are inevitably used to overreach what they are programmed for and produce something terrible. The AI system is no longer working for you as some “second brain”. You are working for it, but no company is going to blame the very expensive AI system that they have invested in when there is a convenient and easily-replaceable (remember how hard these jobs will be to get) human candidate to take the fall. And it will be assumed that people will still do these jobs, reasoning that it is the only route to highly paid and more secure jobs later, or that they will be able to retire at 40, as the aspiring Masters of the Universe (the phrase coined by Tom Wolfe in The Bonfire of the Vanities) in the City of London have been telling themselves since the 1980s, only this time surrounded by robot valets no doubt.

But a model where all the gains go to people from one, older, generation at the expense of another, younger, generation depends on there being reasonable future prospects for that younger generation or some other means of coercing them.

In their book, The Future of the Professions, Daniel and Richard Susskind talk about the grand bargain. It is a form of contract, but, as they admit:

The grand bargain has never formally been reduced to writing and signed, its terms have never been unambiguously and exhaustively articulated, and noone has actually consented expressly to the full set of rights and obligations that it seems to lay down.

Atul Gawande memorably expressed the grand bargain for the medical profession (in Better) as follows:

The public has granted us extraordinary and exclusive dispensation to administer drugs to people, even to the point of unconsciousness, to cut them open, to do what would otherwise be considered assault, because we do so on their behalf – to save their lives and provide them comfort.

The Susskinds questioned (in 2015) whether this grand bargain could survive a future of “increasingly capable systems” and suggested a future when all 7 of the following models were in use:

The traditional model, ie the grand bargain as it works now. Human professionals providing their services face-to-face on a time-cost basis.
The networked experts model. Specialists work together via online networks. BetterDoctor would be an example of this.
The para-professional model. The para-professional has had less training than the traditional professional but is equipped by their training and support systems to deliver work independently within agreed limits. The medical profession’s battle with this model has recently given rise to the Leng Review.
The knowledge engineering model. A system is made available to users, including a database of specialist knowledge and the modelling of specialist expertise based on experience in a form that makes it accessible to users. Think tax return preparation software or medical self-diagnosis online tools.
The communities of experience model, eg Wikipedia.
The embedded knowledge model. Practical expertise built into systems or physical objects, eg intelligent buildings which have sensors and systems that test and regulate the internal environment of a building.
The machine-generated model. Here practical expertise is originated by machines rather than by people. This book was written in 2015 so the authors did not know about large language models then, but these would be an obvious example.

What all of these alternative models had in common of course was the potential to no longer need the future traditional model professional.

There is another contract which has never been written down: that between the young and the old in society. Companies are jumping the gun on how the grand bargain is likely to be re-framed and adopting systems before all of the evidence is in. As Doctorow said in March (ostensibly about Musk’s DOGE when it was in full firing mode):

AI can’t do your job, but an AI salesman (Elon Musk) can convince your boss (the USA) to fire you and replace you (a federal worker) with a chatbot that can’t do your job

What strikes me is that the boss in question is generally at least 55. As one consultancy has noted:

Notably, the youngest Baby Boomers turned 60 in 2024—the average age of senior leadership in the UK, particularly for non-executive directors. Executive board directors tend to be slightly younger, averaging around 55.

Assume there was some kind of written contract between young and old that gave the older generation the responsibility to be custodian of all of the benefits of living in a civilised society while they were in positions of power so that life was at least as good for the younger generation when they succeeded them.

Every time a Baby Boomer argues that the state pension age increases because “we” cannot afford it, he or she is arguing both for the worker who will then be paying for his or her pension to continue to do so and that they should accept a delay in when they will get their quid pro quo, with no risk that the changes will be applied to the Boomer as all changes are flagged many years in advance. That contract would clearly be in breach. Every Boomer graduate from more than 35 years ago who argues for the cost of student loans to increase when they never paid for theirs would break such a contract. Every Boomer homeowner who argues against any measure which might moderate the house price inflation which they benefit from in increased equity would break such a contract. And of course any such contract worth its name would require strenuous efforts to limit climate change.

And a Boomer who removes a graduate job to temporarily support their share price (so-called rightsizing) in favour of a necessarily not-yet-fully-tested (by which I mean more than testing the software but also all of the complicated network of relationships required to make any business operate successfully) system then the impact of that temporary inflation of the share price on executive bonuses is being valued much more highly than both the future of the business and of the generation that will be needed to run it.

This is not embracing the future so much as selling a futures contract before setting fire to the actual future. And that is not a contract so much as an abusive relationship between the generations.

The End of the Professions?

24. July 2025 · Write a comment · Categories: Professions

On Wednesday last week the report from the Leng Review into the safety and effectiveness of physician associates (PAs) and anaesthesia associates (AAs) was published. Although it concluded that:

Research on the safety and effectiveness of PAs and AAs was limited, generally of low quality and either inconclusive or demonstrated a mixed picture.

This apparently did not prevent Professor Leng from feeling able to go right ahead and make 18 recommendations. Neither did it prevent NHS England announcing the same day that it would be expecting all PAs and AAs in the NHS to immediately:

Take on the new names for their roles of physician assistant and physician assistant in anaesthesia respectively;
No longer triage patients or see “undifferentiated” patients.

The rationale for the first of these was the fear that PAs and AAs were being confused with doctors. That this has been addressed by immediately making PAs and AAs much more confusable with each other is just one of the many hilarious things about this report. They also appear to have forgotten to let the General Medical Council (GMC) know, as their website still looks like this:

Then there is the meticulously recorded bile directed at PAs and AAs and their capabilities throughout what is described all over the website as an “independent” report. There were several charts of the opinions of PAs and AAs about their ability to carry out their duties compared to those of doctors. Here is one of them:

The fact I feel able to describe this as mostly bile is the template job descriptions at Appendix 5 of the Leng report. The one for PAs in secondary care includes the following principal duties and responsibilities:

carry out assessments of patient health by interviewing patients and performing
physical examination including obtaining and updating medical histories (looks like B and E);
order and perform agreed diagnostic tests including laboratory studies and
interpret test results (looks like J);
perform basic therapeutic procedures by administering all injections and
immunisations, suturing and managing wounds and infections (looks like M);
help to develop other members of the multidisciplinary team by providing
information and educational opportunities as appropriate (looks like L).

So even the Leng Review appears to have concluded that many of the doctors’ opinions polled here are ridiculous.

Of course I am lumping all doctors together here because the Leng Review does for the most part. There is one sentence where it is admitted that senior doctors, including GPs, tended to be more positive than resident doctors, but this is not really quantified.

The Leng Review will not be the last of its kind. It has taken up the concerns of a threatened profession and worked with them to connive in the othering of another sub-profession (set up, as admitted in the Leng Review report itself, by the Department of Health under, in the case of PAs, a competency framework in conjunction with the Royal Colleges of Physicians and General Practitioners) rather than tackle the actual threats the profession faces. As Roy Lilley wrote:

The BMA can stand in the way, or stand at the front, shaping how technology and new roles like PAs can improve care, close gaps, and make healthcare safer and smarter.

History teaches us that you can’t halt progress by breaking the machinery or driving new careers into a cul-de-sac.

So why are the doctors, particularly resident doctors (formerly known as junior doctors), so offended by the use of PAs and AAs in the NHS? Is it really about safety and effectiveness? Or is it that the British Medical Association (BMA) has finally lost the trust of its more junior members after years of inadequate representation and now is throwing its weight around with the campaign against PAs and AAs and now the resident doctor strike in a desperate attempt to convince them that the reason they are paid less than PAs and can’t get a job after graduation is not the fault of the BMA, but that of the Government, PAs and AAs?

As the Leng Review admits:

Since the early 2000s, and in response to increasing workforce pressures, there has been a growing recognition of the PA role across the globe as a flexible way to address doctor shortages and improve access to healthcare. Today, PAs or their equivalents are employed in over 50 countries, although the role is often adapted locally to meet specific healthcare system needs.

Is it perhaps this very flexibility which is the threat here, when NHS England are already reviewing postgraduate medical training due in large part to resident doctors’ “concerns and frustrations with their training experience”?

The doctors are not the only threatened profession. According to The Observer this week:

The big four accounting firms – Deloitte, EY, PricewaterhouseCoopers and KPMG – posted 44% fewer jobs for graduates this year compared with 2023.

These are the big beasts for finance and actuarial graduates and tend to set the market for everyone else, so these are big changes. Ian Pay of the ICAEW’s quote from the article is even more alarming:

Historically, accountancy firms have typically had a pyramid structure – wide base, heavy graduate recruitment. Firms are now starting to talk about a ‘diamond model’ with a wide middle tier of management because, ultimately, AI is not sophisticated enough yet to make those judgment calls.

A diamond model? That surely only makes sense for those at partner level currently interested in the purchase of diamonds? Sure enough, the article continues:

Cuts to graduate cohorts since 2023 have ranged from 6% at PwC to 29% at KPMG. According to James O’Dowd, founder of talent adviser Patrick Morgan, these are accompanied by senior employees being paid more and more job offshoring. Up to a third of some firms’ administrative tasks are carried out in countries with lower labour costs such as India and the Philippines.

So what happens when AI is sophisticated enough to make those judgement calls, calls which are often sophisticated forms of pattern spotting and which, quite frankly, AI systems are already much better than humans at in many cases already? Will the diamond model collapse still further into a “T-model” perhaps, with the very senior survivors being paid even more? Don’t expect labour costs in India and the Philippines to remain lower for very long as demand increases from their own economies as well as ours.

And the most important question? What then? Who will the senior employees who seem to be doing so well out of this at the moment be in 20-30 years’ time? Where will they have come from? What experience will they have and how will they have gained it when all the opportunities to do so have been given to the system in the corner which never gets tired, only makes mistakes when it is poorly programmed or fed poor data, and never takes study leave at the financial year end?

So Medicine, Finance and now Law. Richard Susskind has been writing about the impact of AI on Law, and with his son Daniel, on other professions too for some time now. The review of his latest book, How To Think About AI, has the reviewer wondering “Where has Reassuring Richard gone?”. In his latest book, Susskind says:

“Pay heed, professionals – the competition that kills you won’t look like you.”

So probably a threatened profession there too then.

In the 1830s and 1840s, according to Christopher Clark’s excellent Revolutionary Spring, the new methods of production led to “the emergence of a non-specialised, mobile labour force whose ‘structural vulnerability’ made it more likely that they would experience the most wretched poverty at certain points in their lives.” The industrialised economies changed beyond recognition and the guilds representing workers, with skills the need for which were being automated away, retreated to become largely ceremonial.

Then the divisions were those of class. This time they appear to be those of generation. Early career professionals are seeing their pay, conditions and status under threat as their more senior colleagues protect their own positions at their expense.

It remains to be seen what will happen to our threatened professions, but it seems unlikely that they will survive in their current forms any more than the jobs of their members will.

The Monty Brewster Predicament

16. July 2025 · Write a comment · Categories: Economics, Professions

Last week I read The Million Pound Bank Note by Mark Twain and Brewster’s Millions by George Barr McCutcheon, from 1893 and 1902 respectively. Both have been made into films several times: the Mark Twain short story was first made into a silent movie by the great Alexander Korda in 1916, although the best known adaptations were the one starring Gregory Peck in 1954 and Trading Places (starring Eddie Murphy) in 1983 (which included elements of both The Million Pound Bank Note and Mark Twain’s novel The Prince and the Pauper); Cecil B DeMille was the first to attempt a film adaptation of Brewster’s Millions (from the earlier play) in 1914, with the best known adaptation being Walter Hill’s 1985 movie starring Richard Pryor (movie poster shown above).

Both stories were written before the First World War and it is interesting to see when each has been revived with new adaptations. In particular, although an early attempt was made to film Twain’s story, noone attempted it again until after the second world war, whereas there was a new adaptation of Brewster during the very interesting period between 1920 and 1922 when the first international financial conferences were being held in Brussels and Genoa to establish an international consensus for policies where “individuals had to work harder, consume less, expect less from the government as a social actor, and renounce any form of labour action that would impede the flow of production.” The aim was to return to a pre World War I economic orthodoxy and therefore remove what would be very painful economic measures for most people from the political sphere and into the sphere of “economic science”. In other words, it was a time when the political elite were trying to change the rules of the game.

This may be because Twain’s story, about a man who is given a million pound note and is feted by everyone he meets as a consequence and never has to spend it, winning a bet between the two men who gave him it as a consequence, was seen as a rather slight tale. Interestingly an American TV adaptation and the Gregory Peck film a few years later came out around the time when the Bank of England actually first issued such notes (called Giants) in 1948, which also relied on the power of people knowing they were there rather than ever having to use them.

The rules of the game certainly vary considerably across the Brewster adaptations: DeMille in 1914 was very respectful of the original but by 1921 the $7 million dollars had shrunk to $4 million. By 1926 in Miss Brewster’s Millions, Polly Brewster must spend $1 million dollars in 30 days to inherit $5 million. This was the point where Twenty20 fortune dissipation appears to have supplanted the Test Match variety. In 1935 a British version had Brewster needing to spend £500,000 in 6 months to inherit £6 million. In 1945 Brewster must spend $1 million dollars within 60 days to inherit $7 million. By 1954 the first Telugu adaptation has him spending ₹1 lakh in 30 days which, by 1985, has inflated to ₹25 lakh.

Later in 1985, the Richard Pryor film requires Brewster to spend $30 million within 30 days to inherit $300 million, with the tweak that he is given the option to take $1 million upfront, which for the sake of the movie he doesn’t. There have since been five further adaptations reflecting the globalisation of the ideas in the story (three from India, one from Brazil and one from China) before the sequel to the Richard Pryor film last year.

What is striking about both stories is how, although supposedly about financial transactions, albeit of a rather unusual kind, they are in fact all about how people behave around the display of money. In Twain’s tale, Henry Adams is transformed from being perceived as a beggar to being assumed to be an eccentric millionaire as a result of producing the note.

In the Brewster story, Monty Brewster has to spend the million dollars he has been left by his grandfather within a year so that he has no assets left in order to claim the seven million dollars left to him by an uncle on this condition. The original story explains the strange condition (something the Richard Pryor film doesn’t do as far as I can recall) as being due to his uncle hating his grandfather so much (due to his grandfather’s refusal to accept his uncle’s sister’s marriage). The uncle therefore wanted “to preclude any possible chance of the mingling of his fortune with the smallest portion of Edwin P Brewster’s”.

The problem for Monty is that he is not allowed to tell anyone of the condition, and therefore it is the difficulties the behaviour he then has to adopt causes him with New York high society that is the subject of the story. There are dinners and cruises and carnivals and holiday homes all bankrolled by Brewster for himself and whoever will journey with him, during which he falls in love and then out of love with one woman and then falls in love with the woman he had grown up alongside. Things normally regarded as good luck, like winning a bet or making a profitable investment, become bad luck for Monty.

By the end of the year, and very close to spending the whole million with nothing to show for it, he returns from a transatlantic cruise where he had been kidnapped by his friends at one stage to prevent him sailing to South Africa, to find himself spurned by the very society he had tried so hard to cultivate:

With the condemnation of his friends ringing in his troubled brain, with the sneers of acquaintances to distress his pride, with the jibes of the comic papers to torture him remorselessly, Brewster was fast becoming the most miserable man in New York. Friends of former days gave him the cut direct, clubmen ignored him or scorned him openly, women chilled him with the iciness of unspoken reproof, and all the world was hung with shadows. The doggedness of despair kept him up, but the strain that pulled down on him was so relentless that the struggle was losing its equality. He had not expected such a home-coming.

After a bit of a scare that the mysterious telegram correspondent Swearengen Jones, who held the 7 million and was assessing his performance, had disappeared, everything comes right for Monty in the end and he marries Peggy who had agreed to do so even when she thought him penniless.

And we are left to assume that everything in the previous paragraph is reversed in the same way as in The Million Pound Bank Note on being able to display wealth once more.

There is a lot of plot in the Brewster story in particular, a lot of which does not amount to much but keeps Monty Brewster feverishly busy throughout.

These two in many ways ridiculous stories, written as they are just as economics is trying to establish itself as a science and ultimately the discipline that shapes our current societies, I think reveal quite a lot about the nature of money amongst people who have a lot of it. Neither Henry nor Monty (apart from an opening twenty four hours for Henry and a scene revolving around a pear in the gutter after a night sleeping rough) experience hunger or the absence of anywhere to sleep at any point. Their concern for money seems to be entirely about social position, the respect of who they regard as their peers and being able to marry the women they have set their hearts on. In other words, money is not about money for these protagonists, it is about status.

It seems to me that almost the entire edifice that we call economics now has possibly been constructed by people in this position. Is this why money creation is represented in so many economic models via constructions clearly at odds with the actual activities of banks (one of many pieces by Steve Keen demonstrating this problem here), and why ideas such as loanable funds and the money multiplier, persist in economics education? Perhaps the original architects of these economic theories did not need money to live, as much as they needed the respect of who they saw as their peers.

David Graeber often used to point out how much more time people at the bottom of society spent thinking about people at the top than the people at the top spent thinking about them. Is this at the heart of the problem?

Of course we do still have some social mobility. A relatively small number of people from poor backgrounds can still enter influential professions. Some of them have even become economists! Of course the very process of becoming a professional is designed to distance you from your origins: years of immersion in a very academic discipline, requiring total concentration and dedication to internalising enough of the professional “truths” learnt so as to be assessed as qualified to practise, normally while engaged in highly intensive work alongside more senior people for who these truths have already been securely internalised.

And then once there you are in the Monty Brewster situation, so insecure about your position within this new society you have joined that you will do whatever it takes to maintain it. You are “upwardly mobile”. Your families are proud that you are “getting on” and doing better, certainly in terms of income and professional respect, than they did. There is no serious challenge to this path other than its difficulty, which again creates a massive sunk cost in your mind when considering alternatives. And it is a path which is invariably described as upward.

Meanwhile the societies we have constructed around these economic edifices also have a lot of plot, a lot of which does not amount to very much but it keeps us all feverishly busy most of the time.

Happy New Year!

03. January 2025 · Write a comment · Categories: Cartoons, Economics, Professions, Risk, Science Fiction

Happy new year to everyone who reads this blog! I am planning for there to be quite a lot more activity here in 2025, moving from an average of one article a month to at least weekly. There should be more cartoons too – Pinhead and Spikes even made it to our Christmas cake this year.

There is a lot I want to write about this year. Expect some or all of the following themes in the next few months (in no particular order):

Some examples using Steve Keen’s Ravel software to demonstrate how Government debt is not the constraint they think it is.
Extending Naomi Alderman’s argument in The Future that we could get rid of the Tech Bros and not miss them, effectively upending Ayn Rand’s ideas in Atlas Shrugged. They are not key workers.
Keynes’ argument that, with the future so uncertain, we should not sacrifice people in the present to our models of it.
Spiegelhalter on the four types of luck, which cuts away at the meritocracy argument for distributing wealth.
How the professions have become a way of solidifying and enabling the massively uneven distribution we see. Have they outgrown their usefulness in their current form, just like the guilds did?
How the choice for providing public goods appears to boil down to public ownership or private monopoly – with accompanying Technofeudalism replacing capitalism. Why are we so much more relaxed about private monopolies than we were 100 years ago, when it accelerates inequalities so much?
The relationship between worldbuilding in science fiction and people living in their own models in the policy making world. Great example of this just this morning in the FT.

So plenty to do. If this sounds interesting to you, please stick with the blog, which will not be going to Substack and will not be charging a subscription. If it sounds really interesting to you, tell a friend! Will be in touch again soon.

Chartered Actuary: a message to students

13. November 2024 · Write a comment · Categories: Actuarial, Professions, Regulation

I last talked about Chartered Actuary status here two years ago when the Institute and Faculty of Actuaries (IFoA) set out how they had decided to introduce it. I focused then on what we needed to do to make this a change worth making: like offering roles for actuaries on completion of core practice modules; not necessarily insisting on further actuarial specialisation as a requirement for senior roles within firms; getting comfortable with a much wider range of specialisms amongst those we consider to be actuaries. Some were already doing this then, but most of us have still not travelled very far in this direction. And I note that the Route to Becoming An Actuary still features a diagram where an IFoA Associate is shown as a milestone on the way to the final destination of becoming a Fellow.

But the fact is that Chartered Actuary status has finally been launched this week. I am a retired actuary now but I have claimed chartered status nevertheless because it is a designation I very much think needs to be supported. However ultimately the success of it will not depend on employers or even the profession itself, and certainly not on retired old duffers like me. It will depend on students now and in the future. Therefore, in the unlikely event that any actuarial students are reading my blog, I am addressing this piece directly to you.

Whether you are a student who, like most actuarial students, started work with no or perhaps just one or two exam exemptions, or a graduate from an actuarial science undergraduate programme with most or all of the core practice exemptions, this means that the barriers to you starting to take your actuarial career off in the direction you want it to go in and think the world needs just got a bit easier to jump. If you are a graduate from some actuarial MSc programmes or even possibly a single qualification like the MMath in Mathematics and Actuarial Science at the University of Leicester (last plug for my former employer, I promise), you may be able to claim Chartered Actuary Associate status already.

Using it may not necessarily be so easy, particularly in the early years. Some employers may be resistant to the new designation. But if you are planning to join the profession to make a positive difference in the world, and that is in my view the best reason to do so, then you are going to have to shake a few things up along the way.

Perhaps there is a type of actuarial business you think the world is crying out for but it doesn’t know it yet because it doesn’t exist. Start one.

Perhaps there is an obvious skill set to run alongside your actuarial one which most actuaries haven’t realised would turbo-charge the effectiveness of both. Acquire it.

Perhaps your company has a client who noone has taken the time to put themselves in their shoes and communicate in a way they will properly understand and value. Be that person.

Or perhaps there are existing businesses who are struggling to manage their way in changing markets and need someone who can make sense of the data which is telling them this. Be that person.

Whatever you decide to do, do it with a chartered actuary designation, whether associate or fellow, as a badge that you are prepared to look beyond traditional ways of doing things and, where the historical way of doing things is obviously no longer working or could clearly be massively improved, do the hard work of rethinking things from first principles if necessary. If you do it right, this can be seen as a badge for actuaries who are both rigorous and flexible in their thinking. If that happens, the chartered actuary designation will flourish and it will also be of maximum benefit to you too.

So now it is up to you what becomes of Chartered Actuary status. I am really looking forward to watching what you do with it!

Changing my social infrastructure

04. June 2024 · Write a comment · Categories: Actuarial, Cartoons, Professions

Posted on LinkedIn on 4 June 2024

This is just a quick personal note to explain the imminent end of my LinkedIn account.

LinkedIn became an important tool for me in 2014 when I became a Lecturer at the University of Leicester and Programme Director for the BSc Mathematics and Actuarial Science there: to connect with potential students and guests to the university, to link up with former students, to publicise the activities of the Leicester Actuarial Science Society and to facilitate a professional network which would be useful to our current and former students. I also posted a few articles here along the way. However I will be leaving the University of Leicester on 30 June and moving to retired status with the Institute and Faculty of Actuaries soon afterwards. Therefore the description I have given myself here (Actuary, Lecturer and Writer at the University of Leicester) will at that point become almost entirely untrue! It therefore seems like an appropriate time to wind up my account here.

According to the latest analytics, I have around 1,400 connections on LinkedIn. Thank you to everyone who has connected with me over the years, particularly if we worked together in some capacity. I have managed to work with some wonderful people over the last 10 years. A particularly big thank you to all of the students who have made the job so enjoyable during that time.

Of those 1,400 connections, over 400 of you list the University of Leicester in your profiles. If you are a current or former student, or indeed anyone who needs to be in contact with a member of the Leicester actuarial team and are currently only connected to me, you should ensure that you are connected to at least one of the following excellent colleagues of mine: Leena Sodha, Paul King or Nigel Sell. You should, in addition, as a current Leicester student, join the LinkedIn group Leicester Actuarial Science Society. If you are a former Leicester student, the group you want is Leicester Actuarial Science Society – Alumni.

I will continue to be in various actuarial WhatsApp groups for the time being and on X (@weknow0). And, if you like any part of what I write, you can always subscribe (for free!) at weknow0.co.uk. For those of you who still want to keep in touch with me by email once I have left here and my Leicester email address has been discontinued, and we have not already shared alternative contact details, please send me a message on LinkedIn (or weknow0.co.uk) and I will be in touch.

With my best wishes for the future to you all.

Horizon and its implications for us all

11. January 2024 · Write a comment · Categories: Actuarial, Cartoons, Legal, Prediction, Professions, Regulation

Copyright ©Steve Bell 2009/All Rights Reserved e.mail: belltoons@ntlworld.com tel: 00 44 (0)1273 500664. Reproduced by kind permission of Steve Bell https://www.belltoons.co.uk/bellworks/index.php/leaders/2009/2913-16-10-09_BOINGUSES

We have been here many times before, even in recent memory. The 2008 banking crisis, memorably immortalised by the Steve Bell cartoon above; the MPs’ expenses scandal the following year; the successive disappointments of Brexit; and now the the Post Office Horizon scandal. All of these had in common an initial public expression of outrage, followed by loud condemnations of aspects of it from within the Establishment, followed by a series of measures which generally failed to change anything substantive. So the ring-fencing legislation brought in to isolate the risk taking within banking from retail customers has steadily been lobbied against and is now gradually being unravelled. MPs continue to have expenses scandals. I don’t know how to encapsulate in a sentence the Muppet Show of how the Establishment has been trying to deal with Brexit since 2016. And now this.

The Post Office scandal seems to be being discussed everywhere: beyond the TV, radio and social media, it is in the pub, the supermarket queue, in families and workplaces. The Establishment condemnation is already underway, as pithily summarised by Marina Hyde here. I do not really care about the implications for the honours lists, but very much hope that the sub-postmasters and sub-postmistresses get the compensation they are seeking. However this time the response cannot stop there.

As David Allen Green has written in Prospect today (with a great overview of what has happened from a legal point of view), the scandal also represents a failure of the legal system. This was partly caused by the repeal, in 1999, of the part of the Police and Criminal Evidence Act 1984 which presumed in favour of individuals rather than computer systems. This has been particularly unfair in these cases as the evidence defendants needed to show that Horizon was at fault often remained undisclosed by the Post Office. It was also caused by the Post Office’s eagerness to pursue private prosecutions.

Coincidentally, I came across the concept of private prosecutions a couple of weeks ago while reading the excellent Butler to the World: How Britain became the servant of tycoons, tax dodgers, kleptocrats and criminals by Oliver Bullough (which also suggested to me that I should revisit the issue of Scottish Limited Partnerships soon, but I digress). As Oliver points out:

Under measures introduced in the post-2010 austerity agenda, defendants…have no prospect of reclaiming their expenses from public funds if they are convicted. Even if they’re acquitted, they can only get their expenses back if a request for legal aid has previously been turned down…Meanwhile, private prosecutors – whether individual or companies – can claim back all reasonable expenses if they lose. Financially speaking, a private prosecution is a one-way bet. As long as you can afford the upfront cost of bankrolling the case, you’ll get your money back because under common law you are acting on behalf of the Crown.

David Allen Green has called for private prosecutions to be abolished, which I would agree with. But I also think the burden of proof needs to be returned to the operators of computer systems in what I predict will become increasingly frequent human-expert system disputes in the future. In fact we need to go further than that and have a full public consultation into what legal protections individual humans will need in a world increasingly driven by decisions and calculations made by non-human systems.

Over seven years ago I wrote an article in response to Cathy O’Neil’s excellent Weapons of Math Destruction, where she set out the case against devolving important decisions to mathematical models without adequate feedback loops. I said then (with an Oppenheimer reference too!) that:

If mathematical models are to be the dominant regulatory tool of a financial world, and of the consultancies and financial firms competing in that world, then the time will come when mankind will curse the names of the highly paid professionals who followed inappropriate rules rather than exercising their own expert judgement when it mattered.

It is starting to look like we may be there already unless we act fast.

We Know Zero