3 Industries that Might Not Be Around in a Decade
Economic sectors might be one of the cornerstones of diversity, but they aren’t timeless. In fact, sectors are born and die over time as technology and consumer habits change. Investors need to be aware of industries and emerging trends that could mean the beginning or end of an industry, or else find themselves lagging behind in a dying business.
Long gone are the days of the seeing the milkman in your neighborhood making deliveries or talking to the switchboard operator when making a call. Those jobs were replaced by automation and other business innovations decades ago.
As an investor, having a long term investment horizon is usually the best advice, but it also means you need to be extra diligent when making your portfolio selections. Unlike stocks that dip down temporarily and eventually go higher, industries that face extinction don’t usually recover. You need to be careful and avoid investing in an industry that could be on its way out.
IoT (Internet of Things) is a game-changing new technology that allows machines and programs to communicate and operate without the need for human interaction. That means energy grids that can order their own repairs, refrigerators that order food to be delivered when they start to run out and, yes, cars that drive themselves.
Automated vehicles won’t just improve safety and make your daily commute easier and more efficient, they also mean professional drivers may soon be out of work. Train engineers and even commercial pilots could be replaced by artificial intelligence within the next 10 years.
Most people think the political climate is responsible for the downfall of coal, but, once again, technology is the real culprit. Coal has been the power source of choice for more than a century because it was cheap, but recent innovations in photovoltiacs means that solar power is now on par with coal for price. With so many people looking at alternative energy and green business policies, an industry as polluting as coal won’t be able to stay competitive.
The cable industry has enjoyed many years of control, dictating what type of programs get made, while consumers were left with whatever was on TV at the right time. But the advent of companies like Netflix, Hulu and Amazon Prime means that cable won’t be able to compete with on-demand programming. While most packages now include some type of on-demand service or recording ability, cable’s popularity continues falling with more and more people switching to cheaper alternative entertainment packages instead.
Industries don’t just die out and leave nothing behind. When business models go bankrupt, other industries take notice of what worked and what didn’t.
Take the publishing industry for example. Printing books and magazines, and selling goods in a brick and mortar store is now a model for quick losses thanks to competitors like Amazon. But the business of the written word won’t just go away. Instead it’s being reinvented with online distribution channels and technology like the Nook that allows users to download hundreds of books onto one device.
Old business models and industries fade away and other more efficient ones rise up and take their place. Technology as an industry hasn’t been around more than a few decades, but is one of the fastest-growing sectors in the economy. There will likely be many more industries in danger of becoming extinct as technology advances through the 21st century.