What If the EU Fractures, China Stagnates, or the U.S. Economy Worsens?(4)
7. In the US, the Emergence of the Home as the Locus of Many Activities: For millions of American families the residence will again gather up several functions that migrated away from the home about 125 years ago. The home, once more, becomes the domicile for income producing work (the home commercial operation-HCO), healthcare, eldercare/aging in place, childcare, schooling/learning/apprenticeships, entertainment, exercise, and even growing food and making wine, depending on size of the property, electricity and natural gas utility tariffs, and zoning. The extended family also enjoys a revival where the personalities and quality of intergenerational relationships permit. The extended family reduces per capita household costs, increases the range of activities that can be undertaken, improves the quality of care, enhances both personal and neighborhood security and allows fairly sophisticated HCOs to function.
Economic and demographic pressures and advances in multiple technologies, software applications and home oriented professional and logistical services converge to facilitate this rebundling of functions. The increasing power and specialization and fallings unit costs of design, collaborative, supply chain, revenue stream and relationship management software; the increasing power and falling costs of home based computing and communications; affordable and compact high “9”s power quality equipment; very potent but compact laser cutting equipment and the impending (3 to 4 years) arrival of practical desktop fabrication makes it possible to undertake a rather large array of high value added commercial and fabrication operations at home while creating quite elaborate and sophisticated but cheap supply, logistics, distribution, marketing and remote work sharing/management networks.
In addition, technology platforms and applications will allow many existing but tiny and inefficient home based businesses to expand to critical mass. HCOs with annual revenues of tens of thousands of dollars to millions of dollars become both attractive and practical. The combination of necessity and feasibility will allow hundreds of thousands of HCOs to exist, taking the home based office or business to a much higher level of economic value added and employment in the US, while also fostering cultural changes that cannot really be anticipated.
The growth of HCOs will be aided and accompanied by the growth of social network financing, micro lending, micro private equity financing, micro M&A, HCO insurance, community banking (as thousands of new community banks are created in the next several years) and special purpose vendor and distribution/marketing channel financing. Home based schooling will also grow markedly given necessity, the availability of family members to teach and the recent emergence of an extensive advocacy and support service infrastructure, particularly in the South.
Home healthcare, aging in place and eldercare will be facilitated and stimulated by the availability of affordable home based defibrillators, dialysis equipment, sophisticated labs on a chip, life support equipment, and remote bio-medical monitoring, sensing, diagnostics and intervention tools, pressure and movement sensors and very inexpensive, long lived, low power, wireless temperature, vibration, moisture and gas sensor webs that can turn a bedroom into a mini life support/life extension facility. Many specialized home healthcare/eldercare services will emerge to provide support services and advice to families.
The home will become an important emerging market for large corporations and HCOs will be diversified and easily accessible sources of supply. In parallel, local community colleges and vocational/technical schools will witness a surge in enrollments while traditional high overhead universities, including elite schools, will see enrollments drop by a fifth to a quarter. Formal, paid, apprenticeship programs will become popular with millions of young people.
The author is no better (and likely worse) at trying to divine consequences than the interested reader. Indeed, the reader should view these consequences as an amusing template and conjure his or her own structures and trajectories. The more actionable these consequences the better the reader will be served in making investment choices. Remember, though, the most significant consequence will be the one we did not foresee. Those tempted by linear extrapolation of the most recent past should remind themselves that we are in an economic episode not an economic change of universe. This too will pass in a few (3 to 4?) years. We are sliding into a deep valley but not an abyss. There is another side which we will reach and then climb up and out. Of course, it will look different on the other side but for many shrewd or merely lucky (and the select few who are both shrewd and lucky) investors, innovators and risk takers it will be a much better place.
