A New Era for "Interaction Workers"

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A New Era for "Interaction Workers"

As defined by a McKinsey & Company study, there are three major categories of work and workers: "transformational," "interaction," and "transactional."1

At the close of the 19th century, most nonagricultural labor involved transformational work, which by definition includes jobs where workers extract raw materials and convert them into finished goods.

By the 21st century, the proportion of American workers involved in transformational activities, such as mining coal, running heavy machinery, or working on production lines, had dropped to only 15 percent. Part of the reason for this continuing drop is the shift toward a globalized economy, where transformational jobs have increasingly moved from developed to developing nations.

The other driver is the increase in interaction jobs. These include managers, salespeople, teachers, and customer service reps, as well as skilled professionals whose jobs require them to spend a lot of their time interacting with other people. These interactions are with other employees, customers, and suppliers, and involve using their knowledge, judgment, experience, and instincts to make complex decisions.

Interaction workers are not only distinct from transformational workers but also from transactional workers, like clerical and accounting workers, IT specialists, auditors, and analytical chemists; these jobs are slowly becoming automated because they rely upon routinized procedures.

Many of the jobs in the air transportation, retailing, utilities, and recreation industries are transactional. Meanwhile, most jobs in healthcare, as well as many in financial services and software, are interaction jobs.

Interaction workers deal with ambiguity in their complex interactions, often drawing on deep experience and knowledge to exercise high levels of judgment. These jobs don't lend themselves to the same kind of productivity-enhancing measures applicable to transformational and transactional jobs. So, although they can't be readily reconfigured to become more productive, they are vital to the competitive success of companies.

Compared to other types of employees, interaction workers play a much greater role in a company's ability to attract customers, compete, and earn profits. Therefore, gains from making these employees more effective are potentially high. Conversely, ignoring opportunities to enhance their performance can result in tremendous downsides.

Because of the potential impact of interaction workers, it's not surprising that they are growing in number and importance. According to McKinsey's research, in the past six years, the number of interaction jobs grew two and a half times faster than transactional jobs, and three times faster than total national employment...

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