We asked for you …
Interview with the economist Vladimír Pikora, guest of the upcoming autumn seminar
First of all, thank you for agreeing to participate in the inspiring IXTENT technology meeting, I am looking forward to your inspiring lecture on Industry 4.0 and the labor market. Before that day comes, please let me ask a few questions for our readers:

You have studied the development of Industry 4.0 for a long time – what do you think will be the greatest benefits and drawbacks of the forthcoming fourth industrial revolution?
As with any developmental change, it will also elevate society to the next level. We will be richer again. This is a positive thing. However, a negative thing will be that the change will be very fast and many people will not be able to adapt to the new world. It will hurt. Some will lose their jobs. Some will have to significantly change how they work and will have to change themselves. Many people will not be able to do this, and they will seek the culprit. They will have psychological problems, they will be bitter, unpleasant. They will lean towards extreme political parties or religions. We will have to find a way to help these people.

Do you see any link between Labor 4.0 and the approaching economic crisis?
Yes, many people know that Industry 4.0 is here and are looking for excuses to delay changing their business or industry. People just don’t like change. Recession or crisis will force them. They will have no choice; they will have to change and switch to new technologies and processes. Among other things, this will bring layoffs and recruitment of other people with a different profile.

When do you expect the economic crisis to occur and how long will it take?
It depends on what you call crisis. If we simplify the situation and talk about a recession, that is, two consecutive declines in the economy, then it is very likely that it will reach us within a year. We must not forget that the US, as the world’s largest economy, is experiencing the longest economic upturn in history. In other words, this fact shows that it is strange that we are not already in a recession. Nevertheless, there are also several other indicators that say that the global economy has already had its best behind it. In addition, massive changes are occurring in the automotive industry on which our economy is based, and these changes are bringing a decrease in production. There is also the threat of a trade war, which will bring nothing good to the economy.

Can we anticipate the development of the property market in the next decade?
The real estate market is now overheated throughout Europe. Property prices are at a record high. This is not a normal situation. It can be expected that the next recession will force the property market bubble to burst. Prices will fall, but only temporarily. I am expecting further growth in property prices in the long term. In ten years, I think prices will be higher than today.

How do you see the current trend in the high debt of the population in relation to housing?
The current situation is very unhealthy. Property prices are too high and people often get into more debt than they should. Many people will have trouble repaying loans when the labor market is not as overheated as it is today and they are looking for work. I’m afraid it will have negative social impacts. These may then be reflected in politics. A few years ago, no politician would have dared to say that people should own at least one apartment or that apartments should be dispossessed. Some people dare say it out loud today. This is a huge risk to democracy. The trigger for policy change is the real estate market situation and large household debt.

What is your interest in teaching financial literacy at primary schools? Given the number of people in debt in the Czech Republic, I would include this in the curriculum …
This is a very sad topic for me, because I would expect every school to throw itself into it. The experience is that the approach of the schools is very different. There are schools that invite me several times each year. However, other schools are not interested in anything new. They want to teach the same as they did thirty years ago. Their teachers went to the zoo once a year and do not want to change it. They don’t want to give up the zoo for a free lecture about financial literacy. The problem is in older teachers. They are not flexible. It often happens to me that after my lecture or discussion with the children, they come and say it is a pity that hadn’t read my financial literacy fairy tales before, because they would not have got into debt. And these people should teach your children how to handle money according to the curriculum. They can’t even do it themselves, and they often don’t want to learn how to anymore!

What would happen economically if the Czech Republic left the EU?
It’s difficult to say. It’s too hypothetical. Look at Britain, they’ve known there will be leaving for three years and they still don’t know how to do it. I think we won’t have to deal with this question because sometimes people talk about Czexit, but this idea has very little support among politicians and voters.

Now for more personal questions if you don’t mind…

Your private and professional lives are is very connected, you run an analytical and consulting company with your wife (also a very successful economist – Markéta Šichtařová), do you see it as an advantage?
For me personally yes, because I can’t imagine my wife having a different profession and I wouldn’t understand her. The idea of being a driver, for instance, and my wife actress or doctor, is unimaginable to me. I don’t know what these people would say to each over. We don’t talk much about work outside of work, but we understand each other. On the one hand, thanks to the profession, we have the same way of thinking and we automatically agree on most things without much explanation (from children’s names to seat colors) and we also know why that day is important or unimportant to us. Nevertheless, everyone is different, maybe it wouldn’t suit other people. I am happy that way.

In the autumn, a fifth joyful event in the family awaits you and your wife, how do two economists make such a large family? Does this situation pose certain “personal economic risks”?
I’ll have to correct you. You have inaccurate information. We are awaiting our sixth child and in the autumn the birth will long be over. The number of children is neither related to the profession, nor to the economic situation or outlook, but to the conservative approach to the world. Our view is simply that having children makes sense. Children are happiness.

I totally agree with you… Do you let your children into the secrets of the economy (proportionate to their age – of course)?
Yes, I wrote a book of fairy tales of financial literacy for them. It was subsequently published and can be bought under the title Zlatý poklad (in English: Golden Treasure). Children often play it as an audiobook before going to bed. Otherwise, of course, we discuss things as they come in life. I think they’re in touch.

Now let me return to the professional field – to the theme of digital transformation…

The fourth industrial revolution will force companies to digitize their business content to increase their competitiveness on the market, streamline their work, save personnel costs … it is possible to estimate when companies will go totally paperless?
This is a very interesting question. In general, the richer the economy (state) or society (company), the sooner it will be. I personally already work like this. I have put down the paper and the pencil. I don’t have any in the office. All I have is electronic. I also canceled business cards. I don’t even want to accept them anymore. I take a picture of them and hand them back. Subsequently, I send mine electronically. As a result, if I have to write a dedication to someone in the book, I have a problem with it, because I’m not used to using a pen anymore. My wife is the opposite. She makes notes on paper during each phone call. So, you see: one company, two approaches. This is how people agree in different companies. I can imagine that in some places it is only a matter of months for them to be entirely paperless, but elsewhere it will take years and in other places it will never happen. It’s about people.

Do you have personal experience in using enterprise content management systems?
It depends exactly what you mean by the term. I worked in several banks and they have systems everywhere.

By when do you recommend businesses perform their digital transformation and why?
Personally, immediately. You can search through digital documents. In paper format too, but it’s hellish when you have to search through a thousand pages. In addition, digital documents can be backed up easily. On the other hand, they can also be stolen easier without anyone noticing. Everything has its pros and cons.

Thank you for the interview, we are looking forward to seeing you at the Canadian Embassy with our colleagues from IXTENT and our guests on 26 September.


Abstract of the September lecture:
“Over the next decade, there will be changes in the economy that humanity has never experienced before. New technologies, robots, and artificial intelligence will transform the economy beyond recognition. We will feel it most on the labor market. Many people will lose their jobs. Many professions will disappear. However, many others will be created. It will be unpleasant for many people, because they will have to change. But companies will have to change as well. Processes will change, companies will replace many people with technology. This will change not only production but also management. Employees will be different. There will work more from home. More will work at times, which are unusual for us today. They will communicate differently. Those who lag behind will be finished. Competition will be frightening. The economy will move even faster than today.” Vladimír Pikora, Nextfinance