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Amazon’s Worker Retraining Plan Is ‘a Drop in the Bucket,’ Says VC

New Enterprise Associates partner Melissa Taunton speaks at Fortune's Brainstorm Tech conference on July 16, 2019, in Aspen, Colo.New Enterprise Associates partner Melissa Taunton speaks at Fortune's Brainstorm Tech conference on July 16, 2019, in Aspen, Colo.
New Enterprise Associates partner Melissa Taunton speaks at Fortune's Brainstorm Tech conference on July 16, 2019, in Aspen, Colo. Amazon's worker retraining program isn’t enough to help workers in an increasingly automated economy, Taunton says.Stuart Isett for Fortune

Amazon committed last week to spend $700 million on retraining a third of its U.S. workforce. But the e-commerce giant’s effort, intended to equip workers with skills needed to compete in the new economy, drew mixed reviews from a group of tech executives and human capital experts gathered at Fortune’s Brainstorm Tech conference on Tuesday.

No one disputed the value of retraining workers. But many in the group, convened to debate prospects of “the future worker,” questioned the scale of Amazon’s investment relative to the magnitude of the challenges with which workers—and employers—in the new, increasingly automated economy must contend.

New Enterprise Associates partner Melissa Taunton called Amazon’s $700 million, to be allocated among 100,000 workers between now and 2025, “a drop in the bucket.”

Despite this skepticism, major measures show a positive labor environment in the U.S. The unemployment rate is 3.7%, the lowest it's been in half a century, according to the Bureau of Labor Statistic. And there are 7.4 million job openings—more than a million more than there are unemployed Americans.

But, as McKinsey Global Institute’s (MGI) Michael Chui pointed out, averages “hide a lot of interesting stuff.”

Chui highlighted the growing divide between rural and urban communities. MGI, in a recent report, estimated that, through 2030, 60% of all job growth in America could be concentrated in just 25 cities and their peripheries.

Others in attendance also added to the list: a yawning gap between skilled “knowledge workers” and those who earn a living doing mostly routine jobs; an employment landscape still tilted against women, minorities, and older workers; unequal access to health care; an educational system still trapped in the Industrial Age; and a rising number of people who aren’t counted in government statistics because they grow discouraged and give up searching for work.

Taunton noted that millennials (born in the 1980s or early 1990s) have come of age in a world of work in which switching jobs every two years “isn’t job-hopping, it’s the norm.” Others lamented the plight of young workers trapped in the gig economy, working long hours for low wages and without a social safety net.

But the full picture is complex. Some noted that millennials prefer the flexibility of the gig economy—comments that gave rise to a discussion of the need for employers to adapt to the different values of younger workers. “This is a generation that loves to have that hustle,” said Kristine Miller, chief strategy officer at eBay. “They were raised knowing they need to provide for themselves. They’re more open to being entrepreneurs.”

Alex Atzberger, president of customer experience at enterprise software giant SAP, expressed confidence that the rise of the robots will create new jobs as it destroys old ones. “I am 100% certain that jobs are going to be there in 10 years,” he said. “But they are jobs we don’t even know about."