As I have mentioned in the past, I am in the 53rd year of my business career, with the vast majority spent in the construction materials industry. Peering into history, we can identify huge tectonic shifts that rapidly advanced us as a society: the canal systems that connected the eastern United States to the burgeoning Midwest in the early 1800s, and allowed the rapid transportation of the bounty of that region to the population back east, and likewise created an explosion of growth in Midwestern cities.
The canals were rendered obsolete by the invention of the railroad, which entrepreneurs gambled everything to connect the East Coast to the Pacific Coast regions, and which changed commerce forever. The Industrial Revolution followed, as did the widespread adoption of the automobile that put America on wheels. Each was a transformative advancement that took our economy to new levels of productivity.
But I have also experienced equally significant advancements during my own career. Looking back at that half-century-plus from a very high level, I observed three tectonic shifts in the business landscape that, at each introduction, served to completely reshape the business world. Generally speaking, they were the invention of the personal computer, followed years later by the advent of cellular telephony, and finally, the creation of the Internet. All three moved our global economy forward due to the vast improvements in productivity that followed each of these breakthroughs.
I like to use the metaphor of the invention of the bag phone to illustrate a point about the promise of each of these tectonic advancements, and how they changed our lives. For those under 35 years of age who have no recollection of the bag phone, it was a crude device; housed in a gym bag that hung from a strap over your shoulder, it held an analog transceiver that got very hot when in operation, powered by a motorcycle battery that weighed a ton, with a curly cord just like a home phone that connected the handset to the device. I promise you, all of us who carried the very first bag phone never dreamed of the rapid advancement of hardware that ultimately brought us the smartphone, a device that has revolutionized our lives in the last couple of decades.
These rapid advancements in cellular telephony are a precursor to the next big tectonic shift, certainly as big as the first three: A.I. And I muse about what it will bring that we cannot imagine, just as none of us bag phone wearers ever dreamed of the smartphone. Like all that came before it, from the canals and railroads to the personal computer and the Internet, it is bringing rapid changes to the world we live in.
And of course, fears abound about the side effects of A.I., just as the advancements before it brought, with the biggest fear being job displacement. The best example is the recent announcement by Amazon that it will cut around 14,000 employees in another sign of Big Tech’s determination to push ahead with artificial-intelligence investment. Amazon’s layoffs are equivalent to around 4 percent of its corporate workforce, but that is not unprecedented for the e-commerce company; it implemented a larger reduction back in late 2022. The cuts make room for more spending on AI and follow through on the company’s claim that the technology will enable Amazon to permanently reduce its workforce.
The tech and retailing giant hinted at more cuts to come as it talked of finding additional places to remove layers in 2026. And other announcements portend the huge investments and rapid advancements of A.I.; Alphabet’s Google is helping reopen a nuclear plant in Iowa in order to power its data centers. That comes as ChatGPT-developer OpenAI calls for the U.S. to build 100 gigawatts a year of new energy capacity, nearly double the level in 2024. The change is as promising as it is rapid.
And I muse about the concrete industry, and where A.I. will take us. We are in the bag phone era; what advancements will parallel the smartphone, and how soon?