Our job search is about to get a lot more complicated.
The ratio of unemployed workers to openings is running at about 3.4 to 1 as we face the biggest jobs crisis since the Great Depression. Now it looks like the competition is not merely from other humans but also from robots.
Andrew McAfee and Erik Brynjolfsson of MIT are at the forefront of warning that we have reached a profound turning point, where, as McAfee put it on the Harvard Business Review blog, “technological unemployment (and underemployment) is a real and growing phenomenon.”
The two are the authors of “Race Against the Machine: How the Digital Revolution is Accelerating Innovation, Driving Productivity and Irreversibly Transforming Employment and the Economy.”
Industrial robots and automation are not new. I covered General Motors in the 1980s, when management inaugurated the highly automated Buick City plant in Michigan. Many of the robots malfunctioned and had to be pulled.
The plant didn’t turn around until managers and the United Auto Workers cooperated on ways humans could increase productivity and quality.
But that’s the outlier. Along with globalization and unwise trade deals, automation is largely responsible for the precipitous decline in manufacturing jobs.
Any talk of a renaissance of U.S. manufacturing must be tempered by the reality that these trends will not result in large job gains.
“Reshoring’s effect on manufacturing employment ... is likely very modest given the high-automation, low-labor demands of most reshored products,” according to Ronald Wirtz of the Federal Reserve Bank of Minneapolis.
The MIT researchers argue that the trend is going to leap into many sectors beyond manufacturing, with smarter robots, ones that use artificial intelligence and the cloud to dramatically improve their capabilities.
Another scholar warning of this highly disruptive inflection point is Martin Ford, author of the provocative book, “The Light in the Tunnel: Automation, Accelerating Technology and the Economy of the Future.”
This is not just an American challenge. Foxconn, the giant electronics maker in China, is buying robots.
Automation cost 22 million manufacturing jobs worldwide between 1995 and 2002, while industrial output rose 30 percent, according to Alliance Capital Management. China’s job-loss rate far outpaced that of the United States. Bloomberg first reported this story.
Not surprisingly, a company likely to be at the forefront of this change is Seattle’s most exciting technology play, Amazon.com.
Last year, Amazon paid $775 million for Kiva Systems, which makes shipping robots. These cute orange machines, which look like large vacuum cleaners with the stems broken off, use sensors and wireless technology to move some merchandise more efficiently than humans.
But analysts and commentators say Amazon is more interested in Kiva’s software and how, connected to the cloud and Amazon’s supply chain, it might be the brain stem for a robotic revolution.
For the many states that depend on thousands of jobs at Amazon warehouses, the end game would be sweeping.
Most of us are hard-wired not to be Luddites. We see technology as savior rather than threat, unless one is speaking of thermonuclear weapons.
After all, in the 1920s more than 2 million Americans worked for railroads. Now about 200,000 do. For example, a small device at the end of a freight train, along with other automation, has allowed crews to be reduced from five to two. In some switching yards, locomotives are run remotely.
Yet overall employment continued to grow, at least until the Great Recession. New industries were created. Professions and jobs unimagined in the Jazz Age were one of the results.
Meanwhile, investment in automation allowed workers to reach much higher levels of productivity. At least until the 1980s, the gains were widely shared.
In thinking about robots, won’t jobs be created in designing, programming, repairing and tending the machines? Some, perhaps. But a growing body of research indicates that this time is different.
The goal of robot-makers, for example, is to make devices that need little human assistance. Amazon might hire more humans for peak periods. But there and elsewhere, the long-term trend may well mean fewer jobs.
Already, software has replaced secretaries. Researchers and librarians have lost their jobs to search engines.
Not only that, but software and automation are displacing higher-skilled, higher-wage jobs. I see a slice of this when I appear on television now. The cameras in the studio are automated.
Fighter pilots, among the most elite, are being replaced to some degree by drones. Translation and legal research are fields well on their way to humans replaced by automation.
A field ripe for automation is health care. Princeton economist Uwe Reinhardt has calculated that without growth in this sector, America would have fewer jobs than in 2000.
According to McAfee, “Previous waves of automation, like the mechanization of agriculture and the advent of electric power to factories, have not resulted in large-scale unemployment or impoverishment of the average worker. But the historical pattern isn't giving me a lot of comfort these days, simply because we've never before seen automation encroach so broadly and deeply, while also improving so quickly at the same time.”
For now, it’s not either/or. Boeing continues to hire. Humans work side-by-side with advanced automation, such as drilling machines. Robotic tape-laying machines make the big 787 airframe sections.
But most workplaces aren’t Boeing. The rise of advanced robots coincides with other troubling trends: wide income inequality, highly concentrated industries, wage stagnation, an outrageous student-loan bubble and lower economic mobility. After the Great Recession, millions are stuck.
In science fiction, robots are supposed to serve humans in an age of luxury — until they turn on us. In real life, they will provide lower prices. But if the worriers are right, the trade-off won’t be enough to offset the loss of one basic human need: A decent job.
You may reach Jon Talton at firstname.lastname@example.org
About Jon Talton
Jon Talton comments on economic trends and turning points, putting them into context with people, place and the environment in the Pacific Northwest