KT 67     The effect of technological change on                             DM 6.4.  Technological changes (including transport and

                resources use                                                                                       communication) and its effects on the extractive

                                                                                                                                industry (including the effects on the economic, social,

                                                                                                                                built and physical environments).

KT 68     The effects of technological change on the

                geography of employment.


KT 69     Differing attitudes to these technological changes.


KT 70     Key decision makers influencing technological





·       The United States is, and has always been, the world’s largest consumer of oil. Until the late 1960s, the majority of the American used oil came from the Persian Gulf states, and this supply was thought to be secure.

·       In 1967, the first of several regional conflicts began. The Arab-Israeli wars of 1967 and 1973 interrupted the flow of oil to the US. Suddenly, the supply did not appear so secure.

·       At this point, the US was faced with the possibility that supplies from the Gulf region could not be guaranteed. For strategic reasons of national importance, the search for US supplies of oil were intensified. In 1968, the Atlantic Richfield Company announced the discovery of oil on the North Slope of Alaskan Territory, in Prudhoe Bay. The yield was estimated at 10-15 billion barrels.

·       In 1973-4, OPEC, the Organisation of Petroleum Exporting Countries, raised the prices of oil on the world market. This Arab-dominated organisation wished to express its displeasure at the Western support for Israel during the wars, and economic retaliation seemed the best option.

·       The first pipes were laid on the Trans-Alaskan Pipeline System (TAPS) on March 27, 1975. The first oil entered the pipeline on the 20th June, 1977. The first billionth barrel of oil arrived in Valdez by 1980. 25% of the nation’s domestically produced oil flows through TAPS.

·       Even though much of the focus for the North slope fields so far has been oil, there exist some substantial gas fields, which are equivalent to 20% of the gas supply of the remainder of the USA. Over two-thirds of this gas will be commercially available.


·       The pipeline runs from the oil and gas fields in Prudhoe Bay on the North Slope, to Valdez terminal, on the Pacific coast.

·       It is four feet in diameter, 800 miles long, and only covers 16 square miles of Alaska’s total of 570,000 square miles. 11 pump stations move the oil at over 61,000 gallons per minute. Oil is pumped over two mountain barriers.

·       At its peak in the late 1980s, the pipeline carried over 2 million barrels of oil per day. Though production is in decline, the pipeline still moves over 1 million barrels of oil per day. (1 barrel = 42 US gallons).

·       The pipeline is designed to move as much as 20 feet laterally and 5 feet vertically to withstand an 8.5R magnitude earthquake.

·       The pipe’s construction was a major source of work for the North USA. 3 million tons of materials were shipped to Alaska, and at its peak, 28,000 workers were employed on the pipeline’s construction.


·       The pipeline was constructed because the site of the oil was inaccessible. Prudhoe Bay is in the Arctic Circle, and the sea is ice covered for most of the year. To even attempt to take a thin hulled tanker to the field would be catastrophic.

·       A pipeline provides the most efficient and effective method of transporting oil over large distances. The terminal at Valdez is on the Pacific Ocean, and does not suffer from ice problems.

·       Advantages of pipelines;

·       Very efficient, fast service provided with maximum safety and dependability.

·       Continuous flow can be carried at a constant rate.

·       Very cheap, especially over long distances, since running costs are low.

·       Causes no air pollution, and, when buried underground, inflicts no environmental damage.

·       Disadvantages of pipelines;

·       Very inflexible, since they operate only from point to point on set routes.

·       Can carry only a limited range of goods, and only one good at a time.

·       High installation costs.

·       May be easily damaged by human and natural actions. Frost shattering may lead to pipe splitting, and warfare may result in deliberate damage. Underground pipes make locating damage difficult.

·       The pipe must be in the vital interests of all the countries through which it passes. This is not necessarily so important for the Trans Alaskan pipeline, but other pipelines world-wide, e.g. that from Soviet Russia in to the former East Germany, will be affected by this.

·       Though the company operating the pipeline have attempted to minimise the effects to the environs through which the pipeline passes, some effects have still been felt, and have had to be dealt with in the construction and operation of the TAPS.

1.     Economic Effects;

Ž   The 1967 and 1973 Arab-Israeli Wars generated a retaliatory economic gesture by OPEC in the form of a price hike. This threatened the US National Security, since their oil supplies could not be guaranteed.

Ž   The discovery of oil, and gas, on Prudhoe Bay was a way to soften the blow from OPEC. However, as the Russians found out in the 1930s - 1960s, the oil is useless if it cannot be extracted and transported to the petrochemical plants.

Ž   The technology existed to extract the oil. The TAPS allowed the Americans to utilise the oil fully, and therefore create a better strategic and economic situation.

Ž   Nearly 20% of the US national demand is supplied by the Alaskan fields. This reduces import costs, and more importantly, guarantees oil supplies, which will keep the vital US interests running.

2.     Social Effects;

Ž   The town of Valdez was previously a fishing village with a small number of inhabitants.

Ž   It has rapidly increased in size, even more so after the Exxon Valdez disaster, where another town sprang up virtually overnight to accommodate the clean up workers.

Ž   The budget of Valdez cannot stretch to provide basic services for all the incoming workers.

Ž   In addition, the workers on the site are usually paid a far higher rate than those who work in the town. This causes some degree of separation, and resentment by the locals. They cannot see why the pipeline has to terminate in Valdez.

Ž   There is increasing opposition to the effects of the TAPS. This is due to increasing numbers of scares and reports about the integrity of the now thirty year old pipeline. Several workers have been killed in recent years in preventable accidents. These only occurred due to cost cutting by the Alyeska Corp. in attempting to reduce overheads.

3.     Built Effects;

Ž   The pipeline itself occupies very little room. However, the supports, the bridges, pump stations and other associated infrastructure takes up slightly more. Even so, it has been suggested that the whole TAPS only occupies 16 of Alaska’s 570,000 square miles of land space.

Ž   This does not include, however, the extractive sites in Prudhoe Bay. Nor does it include the large container berths for the tankers in Valdez, or the support infrastructure there.

4.     Physical Effects;

Ž   Construction of TAPS had to contend with permafrost, two separate mountain ranges, and periglacial environments. It also had to cope with latitudinal zoning.

Ž   Some of the most complicated engineering on TAPS came in addressing these problems. This included the construction of some of the largest bridges known, e.g. the Patton Bridge over the Yukon River at almost 2300 feet. The highest point on the pipeline, Atigun Pass, is almost 4739 feet above sea level at Valdez.



·       The tanker Exxon Valdez struck a reef in Prince William Sound. 11 million gallons were leaked, affecting 1244 miles of coastline. It caused massive environmental damage, in a particularly fragile ecosystem. 3000 sea otters, 124 bald eagles and 30000 sea birds were destroyed.

·       From a legal standpoint, Exxon could have walked away. From a PR point of view, they had to do something. They have always tried to promote an environmentally friendly image.

·       $8 million was spent upon animal rescue centres, and Exxon drafted in thousands of workers to aid the clean up, in a military style operation. Workers came from all over the US, in order to earn up to $2000 per week.

·       The community was outraged. Valdez went from 3,000 to 11,000 people in a few weeks. A virtual town was built to cope with the workers, and pressure was put on Exxon to provide infrastructure.

·       Total clean up cost ran into billions. The environment and coastal fishing and tourist industries have been irrevocably damaged.



·       The use of the home for working is not a new phenomenon. Before the Industrial revolution, most people worked at home, or close to their home. Living above the shop was also typical.

·       With the onset of industrialisation, mass production meant that people went to where the work was. This resulted in the building of factories and the creation of new industrial areas. Daily travel or "commuting" then became the norm.

·       The development of small businesses can play an important role in promoting local employment opportunities. Many people wish to run a business from home rather than from separate commercial premises designed for business use.

·       Recently, many businesses have been encouraging office and mobile staff to use their homes as a base, as a means of reducing overheads.

·       Additionally, the pressure to reduce car usage for environmental and social reasons is beginning to highlight the benefit of home working for many people. These changes are supported by the rapid development of information technology, and the Internet, which is encouraging and allowing teleworking and "hot desking" in many professions.

Considerations for employers and employees

More people are choosing to work from home, but what does this mean for the individual? What are the advantages and disadvantages and what does this mean for industry?

·       Articles state confidently that work will be organised very differently in the future. There will be no large offices where hundreds of people gather each day. The overwhelming majority of the working population will work from home, using technology to communicate with their colleagues, clients and suppliers. Everyone will be able to achieve a better balance between their work and their home life. Commuting will be a thing of the past.

·       This may or may not be true, but in the meantime, how appropriate is home-working?

·       The first issue when considering whether an employee should work from home is whether or not a particular role is suitable for home-working. For such an arrangement to work, clear standards and targets must be set, so that both the employee and the manager know what is expected. The work should not require close supervision or checking, nor necessitate frequent meetings or liaison with office-based staff. Also, if the work is confidential or sensitive, consideration needs to be given to the Data Protection Act.

·       Employers need to be confident that the jobholder is suitable for a home-working role. Is the employee self-motivated, committed and able to work without close supervision or support? Good communication skills are essential in these positions, as are good organisation skills. Does the employee have space at home which can be allocated specifically to work?

Employer’s Perspective;

Assuming that these preconditions have been met, home-working holds several attractions:

·       The company can retain talented and productive employees who have responsibilities requiring them to work near home. The most obvious category here is women returning from maternity leave, who need greater flexibility in their working hours and may no longer be prepared to commute.

·       Savings can be made in terms of office space, which can lead to a reduction in overheads.

·       Employers working in the peaceful surroundings of their own home have fewer distractions and will therefore be more productive.

·       Less time and productivity will be lost due to travelling difficulties.

However, the employer needs to be aware of potential problems. Initial set-up costs can be considerable.

·       The employee will need a PC and printer, a modem, a separate telephone line and furniture. An ergonomically sound chair alone can cost as much as £400.

·       There will be ongoing costs for telecommunications, particularly if access to the Internet is required throughout the “working day”.

·       A health and safety representative will need to visit the employee’s home to check on equipment layout, position of workstation and cables, etc.

·       A problem with a PC or another piece of equipment is more difficult to fix quickly.

·       There are insurance issues to be addressed. In terms of employers’ liability insurance, who is covered in the event of an accident occurring whilst at home?

·       Lack of management control - it is obviously less easy for managers to keep an eye on staff who are physically remote and to communicate goals and values. Such managers may need specific training in remote management techniques.

·       There are likely to be concerns over security - homes are rarely as secure as offices.

·       It can be difficult to maintain team spirit - home-workers are at risk of becoming isolated.

Employee’s Perspective

·       No more commuting, saving time, travel costs and perhaps a lot of frustration and stress.

·       More time freed up to spend with the family.

·       More flexibility in working hours.

But again, for employees, there are potential disadvantages:

·       It is quite easy for home-workers to feel isolated and out of touch with their colleagues.

·       It may be difficult psychologically to separate work from domestic life, leading to the potential for overwork and stress.

·       The ‘office’ at home may take up much needed space.

·       There is a danger that the home-worker will be perceived as ‘not a real employee’ by management and colleagues, with the consequent loss of respect and career opportunities.

There are a number of factors to consider on both sides of the home-working equation. If the costs and effort of setting up employees to work from home and the difficulties of managing them are outweighed by the benefits achieved in terms of staff motivation, retention and productivity, it could be a good move. If this is not a convincing case, it may be best to wait until the job roles in the business become more conducive to home-working and the equipment essential for the job becomes more reliable.

Internet use has made home-working more of an option. Nearly 8 million homes are now online, half of adults have used the Net, and 40% of schoolchildren log on for help with homework. Throughout the 1990s, traffic approximately doubles every 100 days. Internet use peaks in the late afternoon and evening, reflecting the personal usage of the Net.