Knowledge workers make a living by dealing purely with ideas and information.

The term has only been around for 50 years. Writer and management expert Peter Drucker first used knowledge worker in his 1959 book "Landmarks of Tomorrow".

Drucker modestly said he was only the second person to use knowledge worker. He said it came from Fritz Machlup a Princeton economist.

Either way, Drucker popularised knowledge worker spending years expanding on the original idea and its wider implications.

Today's knowledge worker

Knowledge worker is widely used today. While people generally understand the term's meaning, there is still misunderstanding about its exact definition — even among knowledge workers.

Some think knowledge worker only applies to people working in information technology or elsewhere in industry using tools created by IT workers.

IT workers are only a subset. Anyone who makes a living out of creating, handling or spreading knowledge is a knowledge worker.

This covers a wide range. Teachers, trainers, university professors and other academics are clearly included. Writers, journalists, authors, editors and public relations or communications people are all knowledge workers. Lawyers, scientists and management consultants can also all be described as knowledge workers.

Educated workers

One key difference between knowledge workers and other white-collar workers is the level of education and training. Some knowledge workers don't have a formal tertiary education or high-level training – but they are a minority.

As a rule, knowledge workers have at least a university undergraduate degree, but that's not always the case.

Older knowledge workers may have fewer formal qualifications. That's partly because higher education was less available when they started out — and, anyway, university isn't the only path to knowledge.

Another reason is practical experience counts for a lot. But the key here is knowledge workers
each have a personal knowledge store they apply in their work.

Knowledge workers are well paid compared to other groups of workers – some are extremely well paid. Some knowledge workers join unions, but they are not usually organised in that sense.

This can lead to forms of genteel exploitation: few knowledge workers get paid overtime yet most are expected to voluntarily work for considerably more than the basic 40 hours a week.

Knowledge skills are mobile

Knowledge workers are more mobile than industrial workers. They can take their expertise elsewhere at the drop of a hat. This happens all the time.

An employer who abuses knowledge workers' professionalism is likely to see their most important assets walk out of the door one evening and never return. This applies as much today as it did when there were more jobs around.

Few governments have come to terms with the implications of having a highly mobile, highly educated, knowledge workforce. Just as knowledge workers can quickly find a new employer if necessary, most can move freely between countries. Any nation that doesn't look after knowledge workers can expect – over the long-term – to lose them.

This applies in New Zealand, which operates a progressive income tax system that, at times, appears deliberately designed to alienate knowledge workers. To understand this, compared the marginal and absolute rates of income tax paid by most New Zealand knowledge workers, they are noticeably higher than in most competing nations.

When I wrote the first draft of this post (it originally appeared in a different format in 2001) the same could be said of Australia. Since then Australia has moved to correct its tax system and is attracting 40,000 New Zealanders each year, most of those emigrants could be classed as knowledge workers.

In the 1960s there was a lot of talk about a 'brain drain'. If anything the flow of knowledge workers migrating to more benign economies is accelerating.

Drucker distinguishes between various classes of knowledge worker.

High-knowledge workers include professional groups such as doctors and teachers deal mainly in the realm of the mind while the knowledge technologists work with their hands and brains in the IT industry, medicine and other areas. Although both categories of knowledge worker are growing, the bulk of growth comes from this second group.

A great YouTube clip adapted from Dan Pink's talk at the RSA, illustrates the hidden truths behind what really motivates knowledge workers.
I found this at Miramar Mike's site posted as Drive: The surprising truth about what motivates us.

An article in CIO magazine about Peter Drucker – who first coined the term knowledge worker.  It isn't a soft piece. In The comeback Charlatan David James is critical writing;

He talks about knowledge as the organisation's vital "resource". It is not a resource (resources are inanimate; knowledge is an act of animate humans).

Likewise, his use of the economics-derived term "productivity" is doubtful. It is not how much knowledge is "produced" but how well it is applied.

In an interview with BRW, Drucker dismissed these concerns, saying that "eventually, we will have to work out the proper methodology for both defining and measuring knowledge, work and the knowledge worker".

The comeback Charlatan

Things might not look too hot now, but knowledge workers will soon be in demand again. Employers who showed a dark side during the recession will struggle to fill vacancies.

Despite the recession, New Zealand still has a severe shortage of building industry skills and there are pockets of the IT business where vacancies have remained since the global economic meltdown began.

Australia already shows signs a severe shortage of IT skills could hamper companies and government departments as early as next year.

In Demand for ICT professionals on the rise, bottom is in Stan Beer at iTWire reports; “The bottom in ICT employment has been reached and demand for skilled jobs is once again on the rise, according to the latest market survey from a major technology recruiter. The news adds to a growing list of evidence of a return to health of the ICT jobs scene.”

A week earlier ITNews covered a report from Australia’s largest recruiter Peoplebank saying the demand for contractors was rising. A similar story appeared in CIO magazine in June with Seek Employment noting the overall job market was stabilising with IT consultants in high demand.

Australia’s ITNews reprinted a story from Britain's Computing newspaper on July 7 saying the antipodean nation is busily recruiting IT specialist in the UK to meet a shortage.

The Australian reported on a skills shortage in research organisations in Upgrade ignores skills shortage (story no longer online). And the New Zealand Herald reports there are many shortages in engineering.

New Zealand CIO magazine carried a report suggesting most IT employers face a skills shortage despite the recession. Despite downturn, opportunities remain for APAC IT candidates suggests one in four tech employers expect to increase their headcount this year. The story singles out specific skills in business analysis, datawarehousing, ERP (Oracle/SAP), web development and infrastructure (architecture) as being of particular interest.”

Some shortsightedness is in evidence in IT training budgets slashed at ITNews which suggests employers have slashed skills spending and can expect to see a serious skills vacuum by 2112.

What does this mean?

First, it’s a safe bet the skills shortage will return to Australia in the next year or so and to New Zealand soon after – the two countries are effectively a single market for knowledge workers. If anything it could be worse than before for a couple of reasons. Many skilled workers will have drifted off into other occupations or even early retirement. At the same time employers have cut back on training during the recession. While there are increased numbers of people taking tertiary courses in technology and similar subjects, many won’t enter the workforce in time for the recovery and they’ll have knowledge, but little experience, which means only a handful will hit the ground running.

Employers who behaved cut back staff, skimped on training or held on to skilled workers and pushed them too hard during the recession will all suffer once the skills shortage kicks in again. Knowledge workers will be able to drive better bargains – and recent experience will teach people to look beyond the pay packet.

Writing in BusinessWeek Marshall Goldsmith says:

Knowledge workers can be defined as people who know more about what they are doing than their managers do.

Update: Here's a piece I wrote to explain the term – Who are the knowledge workers?

"The best way to predict the future is to create it."

Peter Drucker

Many regard Drucker as the father of modern management. Here we remember him as the man who came up with the term; "knowledge worker".

I love two things about this quote. First, its confidence. Second, it inspires me to get off my backside and create things.

Next time you drive through the CBD late at night, notice how many offices are brightly lit.

• A handful might house call centres, newspapers or IT operations; businesses that routinely work night shifts.
• Some might be lit for cleaners.
• Others are empty but lit. There are companies who light their offices at night as a gesture of solidarity with global warming deniers.

Yet even from a moving car you may spot a surprisingly large number of people who are still working.

The last time I drove through Auckland I noticed workers and this was at around midnight. I know from experience that the situation is similar in cities around the world.

People work longer hours

Of course, long hours are not unusual for knowledge workers. They are common among younger people in their late teens and early twenties. But it happens right across all age ranges.

Surveys show that the average working week for a full-time employee in New Zealand is now around 44 hours. Twenty percent of employees regularly work more than 50 hours a week.

New Zealand isn’t different from other countries.

Given a sizeable section of the workforce still works shifts or fixed hours and that there are still many clock-watchers who race out of the door at 5.00pm or 5.30pm this means that for committed workers the average working week is considerably longer.

At a guess I’d say readers of this column are more likely to average 48 hours a week.

But that’s only an average. Some work more.

Work marathons are not a problem

I’m certain we’ve all pulled the occasional marathon work session or two. Over short periods these are not a problem.

However, over the long-term, if excessive work hours are not strictly controlled they can lead to serious health issues and other major problems in the workplace. Not to mention grave conflicts with those increasingly rare parts of our lives that happen away from work.

Things aren’t as bad today as they were at the height of the dotcom frenzy, but there are still plenty of people who habitually work 12 to 16 hour days. And many people in cities like Sydney or London  have long commutes before and after work.

Most people who work long hours do so because of real work pressures – for example you may struggle to meet deadlines. This is fine if it happens rarely. Frequent long hours are usually a sign that something is badly wrong at your workplace. It shows your employer is not playing fair with staffing levels. And that means you are exploited.

Twisted workplace culture

We’ve all seen companies that demand or extract long hours because of a twisted culture. I’ve certainly worked in places where there has been some complicated game of chicken going on, with employees competing to show management who is the most loyal and dedicated worker by staying in the office later and later.

Of course these employers might argue that there’s a severe skills shortage so existing workers need to do more. There’s an element of truth. However, abusing something rare and precious is a perverse way to run a business.

No doubt some employees feel pressure to work long hours to save their jobs in a recession. And yes, there are employers only too willing to exploit this fear.

The knowledge worker credo says that you don’t have to put up with that kind of nonsense. Even in a global recession. In the good times there’s always another employer who needs your skills. So if your employer pressures you to regularly work excessive hours – and in my opinion excessive hours is more than 50 hours a week sustained over a long period – then you have every reason to walk. Even in the bad times you can  find a better deal.

The last time I touched on this issue I received angry and abusive email from readers who think looking after oneself is strictly for sissies. So we’ll all doff our caps in reverence to the sheer manliness of the hardened macho types and remind ourselves of two truths about long hours.

• First, sustained long hours are not healthy. Period. If you continue to work around the clock you will damage your body. You almost certainly won’t be getting enough exercise. There’s a good chance you won’t be eating properly. And you probably won’t be giving yourself enough downtime.
• Second, there’s a lot of scientific evidence that long working hours are not productive.

We’ll look closer at both these issues another time. For now, ask yourself if all the hours you work are necessary. Even if the only pressures are self-imposed, you might want to evaluate your relationship with your employer in terms of the hours you spend working.

Maslow’s Hierarchy of Needs says you can predict how people will behave by looking at their underlying needs.

Maslow believed, for example, a starving person would find food first, putting aside every other consideration including social niceties.

Maslow's theory useful but flawed

While Maslow’s theory has its uses, most modern management experts and psychologists regard it with suspicion. One obvious criticism is that the hierarchy doesn’t take into account acts of selflessness, bravery, charity and heroism.

You might ask yourself why some German citizens hid Jews from the Nazis. Or why starving servicemen in Japanese prisoner of war camps would give up their own food supplies to help the weak and dying. But then most economists and biologists would also find these seemingly irrational acts hard to explain.

Likewise, many of the best and most creative painters and poets – who Maslow would describe as self-actualising – were starving in attics when they did their best work. Where does Vincent van Gogh sit on the hierarchy of needs?

Creativity and poverty

We can all think of examples of filmmakers, musicians and other artists whose creativity dried up when they hit the big time. Years ago I worked as a music journalist and discovered many financially challenged rock bands would deliver a brilliant first album, score a huge contract and then wallow self-indulgently in the studio for album number two. Many never got the opportunity to make a third record.

Jim Clemmer and Art MacNeil make an important criticism of Maslow’s Hierarchy of Needs theory in their book “Leadership skills for Every Manager” (ISBN 0861889630). The book is out of print, but you may find a copy in a decent university library (If you’ve got it and no longer want it, get in touch with me).

Hierarchy of Needs: misses the point

Clemmer and McNeil suggest that Maslow misses the point because he left people’s spiritual dimension out of the picture. They say that humans look for meaning in their lives and that meaning transcends any animalistic drives.

In their words, “even starving people are not immune to the lure of higher values.” Think about van Gogh.

A more scientific criticism was published in the 1977 edition of “The Annual Review of Psychology”. Here, A.K. Korman, J.H. Greenhaus and I.J. Badin wrote that there’s no empirical (that is, researched) evidence to support Maslow’s ideas. In fact, they argue the empirical evidence points in the opposite direction. Other critics have pointed out that Maslow came up with his theories after observing only a handful of people and it lacks scientific rigor.

We’ll leave these debates for the academics.

The important thing about Maslow’s idea is it is a good, maybe crude, starting point for understanding what drives  people. The Hierarchy of Needs provides a useful template that can help explain how and why people behave.