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The transformation in the article is the usual one we've seen for the last several decades in other service industries like foodservice, retail, home system ser
by temp-dude-87844 8y ago
The transformation in the article is the usual one we've seen for the last several decades in other service industries like foodservice, retail, home system service, and even transportation. An uneven patchwork of limited-region small businesses is being abstracted away, albeit not necessarily replaced, by national middlemen with deep pockets, vast experience, consistent standards, and powerful negotiating position. Those looking to hire them to perform a service are pleased with the consistent standards, tailored solutions, and their ability to keep costs predictable across the board. Those middlemen often contract out to the exact crop of companies and people who were doing the work before, but the standards are higher, the competitive price pressure is higher, and a cut goes to the coordinator which didn't before.
With time, this will result in consolidation, as it has always has. The most underperforming subcontractors will be shed, some will be directly acquired, existing employees will be handed new responsibilities, geographic bases will expand and redundancies will be identified. Both the job alarmists and the capitalist extollers are right, because this is the path to efficiency among whose chief instruments is reducing labor cost, but also because this process has always played out for hundreds of years in the exact same way.
The silver lining here is that this particular transformation isn't based on regulatory arbitrage (or simply ignoring the law), doesn't result in the sort of homogenization that imperils an intangible heritage (like foodservice consolidation did), but is actually about a middleman inserting real value into the supply chain. It's exactly what it says on the tin, and that's quite nice.
- jjt-yn_t 8y agoI started to add a 5th [ healthcare ] but internally narrated it to something NOT adding real value [ the last part of the post above ] and got writers block...