I would like to see an update to this post one year after the first driverless truck crosses the roads in a regular trip.
With update I mean a postdata or a new post.
With regular trip I mean that there’s no human driver supervision, it’s not testing, etc
Paul Jurczaksays:
“we will create work that is not strictly needed” – maybe in Canada, but good luck with that in the USA, especially after another tuck towards laissez-faire capitalism with Trump presidency.
“in the US, the less educated also enjoy a much higher amount of leisure time” – especially these with two or three low paying jobs.
My point is that countries like Canada, with well developed social safety nets have a chance dealing with advanced automation. Countries like the USA have a high chance of turning it into nightmare. This is not a technical or economics problem, but the one of social structure.
“in the US, the less educated also enjoy a much higher amount of leisure time†– especially these with two or three low paying jobs.
You might think that people who are on the lower scale of income work longer hours, but the reverse is true. Statistically, the people doing the equivalent of two jobs are in the top quintile of income:
The annual number of hours of employed labor in the top quintile is still nearly twice that in the bottom quintile. (Hederman & Rector)
Dan Focklersays:
Employment is a side-effect of capitalism’s need to generate saleable products. Assuming there is market demand for your products, which the ‘millennial’ generation has shown many companies the door, when you don’t have a need for labor to produce goods, you invite oligopolies to flourish. The fastest, biggest, richest will be able to hit economies of scale first and push or buy others out of the market, until you have no market left. Technology exacerbates this problem. Labor and spending money are the individuals’ only sources of power in the economy. When labor has less and less impact on a company’s bottom line, labor gets treated badly more and more. Without government incentive to create jobs and without the philosophical idealism surrounding work, there will be nothing to stop companies from automating as much as they can. It will be up to governments and communities to decide how they will let companies treat people and the environment when they the people no longer have any power in their economic system.
Jacksays:
There’s a lot of talk about technological unemployment, and I think we’re possibly in the ‘uncanny valley’ stage. You can see where things are headed, but it’s not good enough to actually use. Yet.
But the issue is really sociological, just as it was with the Luddites and the looms – the technology itself wasn’t the problem, but the social structure of who owned the looms, etc.
Countries that are structured for the needs of people will be able deal with automation, those that are modelled on feral capitalism, less so.
Rodericsays:
I’d like to raise an issue with your bank teller point. Your reference uses a reference which indicates that bank teller employment has increased substantially since the 70s (when ATMs were just introduced), but since the 80s (when, I assume, they began to be used in earnest) only by about 16% (from 500k to say 580k). On the other hand the US population has increased from ~220 million to ~320 million (and the labor force has had a correspondingly large increase). Although true, isn’t it a little misleading to say that there are more tellers than ever? It seems like it would be a harder job to get with the change in ratios, for instance.
I don’t think that the statement is misleading. On the contrary, I think it is very much a “leading” observation.
Consider truck drivers. We now have self-driving trucks. Some people say that it implies that soon these drivers might be out of a job. Are they correct?
What if, in 30 years, we had more truck drivers than today? What the bank teller story tells you is that this is entirely possible, even with fully automated trucks.
Why might this be? Well, bank tellers in 2016 help people with non-mundane tasks. Most of the simple cash withdrawals are automated… but there are many things that are easier and simpler with a human being simply because it exceeds the programming of the machine.
What might happen is that number of deliveries might multiply… say become 10x what it is today, so that truck drivers would occupy a small niche, but this small niche could be larger than the whole truck delivery industry today.
The trick is that automation works best by covering the easiest 80% of all cases. It gets increasingly more difficult to automate whatever remains. At a glance, it seems like bad luck for the human beings because they get corned to the remaining 20%… but the whole industry might grow so large that this 20% is larger than the whole industry when automation started out.
Rodericsays:
Thank you for the lengthy, considered reply!
I appreciate that the insight you describe was what you were leading to with the bank teller point, and now the truck driving hypothetical, however I don’t think having “more” of a job is necessarily a sign of harmlessness for automation. Could we have 1 more bank teller job than 1980 and 50% more workers and make the same conclusion? More jobs doesn’t mean effectively more work for the people who fill those jobs if proportionally less of them are needed.
Bank teller jobs grew, but not nearly at pace with the growth of the whole labor force. If truck driving and other sorts of jobs are partially automated and grow at a similar pace, wouldn’t we expect the sort of people who fill those jobs now to be much worse off in the future with the higher competition (assuming population / labor force growth is still much greater)?
I also appreciate that automation may create entirely new jobs. Hopefully industry growth would include adding many of these new jobs and fill in the missing job growth, but your reference doesn’t indicate whether that was the case or not for banking. My point is to take issue with using data that only looks at one job and indicates hugely slowed growth for that job after automation is introduced and treating it as a positive.
It seems quite plausible to me that society can find a stable organization with massive automation of routine/menial jobs. However I’m concerned about the pace. It took in the (very rough) ballpark of a century for developed economies to go from the majority of the population working in agriculture to only a few percent. That’s several generations! If the more aggressive predictions about the AI-related changes we are on the cusp of are even close to correct, we’ll see similar economic migrations in a single generation.
People and their institutions don’t have a great track record at adapting to such big changes that quickly.
Jasonsays:
I just don’t believe there will be jobs for humans soon. We have a finite skill set. We have vision, hands to manipulate objects, legs to get us around, the ability to communicate and understand language, and a brain to problem solve. Machines are making rapid progress in all of these areas. Once you have an intelligent machine that can move around and manipulate objects…why would you then ever hire a human? Some say we will have that kind of intelligence by 2035. People believe new industries will be created through technology as this has always happened in the past so people will work in those new fields. However, the past never had super intelligent AI and machines with human like bodies. Once we have these things why would you ever hire a human who is lazy, incompetent, physically and intellectually weaker?
Ksays:
Its true that tech has created more jobs than it destroyed in the past. But i think tech vis a vis employlent moves in three stages. First stage: It will create more jobs than it destroys. Second stage: As it gets more advanced it will slowly begin to destroy as many jobs as it will create. Third stage: As it gets even more advanced it will destroy more jobs than it will create.
Do you have any numbers showing a decline in the number of software programmers in India?
Ksays:
Not a decline, but i remember reading that fewer and fewer software programmers will be needed to produce the same amount of revenue for the companies. For eg: 100 billion revenues by software companies were achieved using five million employees upto the year 2015. The companies’ top management predict that the next billion in revenue can be achieved by only 3 million using software automation and other kinds of tech! Thats a potential job loss of two million in the software industry. This also have more wider effects. For example india’s domestic construction and retail sectors depend a lot on the new rising middle class which are made up mostly by these software engineers. So these two million potential job losses will affect jobs in these two sectors too. And in many more sectors like clothing, airlines, electronics….you name it. I dont remember these as the exact numbers but the percentages are around the same ballpark. You could google it though (sorry :)).
Another example: Since the rise of online shopping in india clothing has become very cheap. Due to this many more are buying more clothing than before. This is leading?lead? to more jobs initially. But another dangerous trend has begun. The price depressing effects of these companies has led to a fall in clothes prices in the retail sector. Now what will happen because of this is, this will lead to less hiring in retail. It will also lead to more pressure on cloth suppliers and textile factories to reduce their prices( who will do it by reduce their staff) and by putting more pressure on cotton traders to lower their prices who will put pressure on cotton farmers to lower their prices.
All these sectors are beginning to get affected slowly.
Not a decline, but i remember reading that fewer and fewer software programmers will be needed to produce the same amount of revenue for the companies.
We are supposed to get more productive over time. If this did not happen, most of us would still work on farms, trying to keep our kids fed.
As workers can do more things in less time, it allows us to pursue new services and products.
In 1990, hardly anyone in India worked on software or the Internet. Today, thousands do… but that was made possible because these same people are not needed to produce food and housing.
In time, we will need fewer people to keep our servers running… and this means that these people will be free to do other work.
It is a good thing.
Another example: Since the rise of online shopping in india clothing has become very cheap. Due to this many more are buying more clothing than before. This is leading?lead? to more jobs initially. But another dangerous trend has begun. The price depressing effects of these companies has led to a fall in clothes prices in the retail sector. Now what will happen because of this is, this will lead to less hiring in retail. It will also lead to more pressure on cloth suppliers and textile factories to reduce their prices( who will do it by reduce their staff) and by putting more pressure on cotton traders to lower their prices who will put pressure on cotton farmers to lower their prices.
You are pretty much describing how capitalist economies get richer over time. Things get cheap, people get more productive and so forth.
Tracy Yangsays:
I really like this article, it offers me some new perspectives. But I’m wondering how could some developing countries whose people rely on low-paid jobs cope with this issue since their people are very likely to lose their jobs. Maybe, in the long run, technological development can help better earth residents as a whole, but in the short run, it’s a bit worrying. anyway, I’m also optimistic as well. But I think there’s a lot governments, international communities have to do to help make this inevitable trend something positive. hope to read more about this issue.
Jonathan Bigelowsays:
The threat of technological unemployment or, at a minimum, severe underemployment is very real in the United States and other countries with strong negative views of proactive social safety nets.
The McKinsey Global Institute estimates that 50% of current work activity will automatable, replacing as many as 800 million jobs globally by 2030. The White House Council of Economic Advisors finds that more than 80% of workers earning less than $20 per hour will lose their jobs to automation by 2036. 48% of 1,896 AI experts surveyed by Pew Research believe that AI and robotic technologies will displace more jobs than they create by 2025.
There is a strong likelihood that society will “create work that is not strictly needed,” but what will this work pay? When work fails to create economic value, by its very nature it will be less financially rewarded. This will, at a minimum, create an extreme economic disparity between the techno-capitalists that employ the robots, and the people that do the meaningless work simply to have something to do.
Forward-thinking countries need to immediately explore universal basic income or negative income tax to counter technological unemployment. The number of humans on this planet continues to grow, and there will undoubtedly be less meaningful work for humans in the future as AI and robotics replace the need for human labor.
I would like to see an update to this post one year after the first driverless truck crosses the roads in a regular trip.
With update I mean a postdata or a new post.
With regular trip I mean that there’s no human driver supervision, it’s not testing, etc
“we will create work that is not strictly needed” – maybe in Canada, but good luck with that in the USA, especially after another tuck towards laissez-faire capitalism with Trump presidency.
“in the US, the less educated also enjoy a much higher amount of leisure time” – especially these with two or three low paying jobs.
My point is that countries like Canada, with well developed social safety nets have a chance dealing with advanced automation. Countries like the USA have a high chance of turning it into nightmare. This is not a technical or economics problem, but the one of social structure.
“in the US, the less educated also enjoy a much higher amount of leisure time†– especially these with two or three low paying jobs.
You might think that people who are on the lower scale of income work longer hours, but the reverse is true. Statistically, the people doing the equivalent of two jobs are in the top quintile of income:
Employment is a side-effect of capitalism’s need to generate saleable products. Assuming there is market demand for your products, which the ‘millennial’ generation has shown many companies the door, when you don’t have a need for labor to produce goods, you invite oligopolies to flourish. The fastest, biggest, richest will be able to hit economies of scale first and push or buy others out of the market, until you have no market left. Technology exacerbates this problem. Labor and spending money are the individuals’ only sources of power in the economy. When labor has less and less impact on a company’s bottom line, labor gets treated badly more and more. Without government incentive to create jobs and without the philosophical idealism surrounding work, there will be nothing to stop companies from automating as much as they can. It will be up to governments and communities to decide how they will let companies treat people and the environment when they the people no longer have any power in their economic system.
There’s a lot of talk about technological unemployment, and I think we’re possibly in the ‘uncanny valley’ stage. You can see where things are headed, but it’s not good enough to actually use. Yet.
But the issue is really sociological, just as it was with the Luddites and the looms – the technology itself wasn’t the problem, but the social structure of who owned the looms, etc.
Countries that are structured for the needs of people will be able deal with automation, those that are modelled on feral capitalism, less so.
I’d like to raise an issue with your bank teller point. Your reference uses a reference which indicates that bank teller employment has increased substantially since the 70s (when ATMs were just introduced), but since the 80s (when, I assume, they began to be used in earnest) only by about 16% (from 500k to say 580k). On the other hand the US population has increased from ~220 million to ~320 million (and the labor force has had a correspondingly large increase). Although true, isn’t it a little misleading to say that there are more tellers than ever? It seems like it would be a harder job to get with the change in ratios, for instance.
@Roderic
I don’t think that the statement is misleading. On the contrary, I think it is very much a “leading” observation.
Consider truck drivers. We now have self-driving trucks. Some people say that it implies that soon these drivers might be out of a job. Are they correct?
What if, in 30 years, we had more truck drivers than today? What the bank teller story tells you is that this is entirely possible, even with fully automated trucks.
Why might this be? Well, bank tellers in 2016 help people with non-mundane tasks. Most of the simple cash withdrawals are automated… but there are many things that are easier and simpler with a human being simply because it exceeds the programming of the machine.
What might happen is that number of deliveries might multiply… say become 10x what it is today, so that truck drivers would occupy a small niche, but this small niche could be larger than the whole truck delivery industry today.
The trick is that automation works best by covering the easiest 80% of all cases. It gets increasingly more difficult to automate whatever remains. At a glance, it seems like bad luck for the human beings because they get corned to the remaining 20%… but the whole industry might grow so large that this 20% is larger than the whole industry when automation started out.
Thank you for the lengthy, considered reply!
I appreciate that the insight you describe was what you were leading to with the bank teller point, and now the truck driving hypothetical, however I don’t think having “more” of a job is necessarily a sign of harmlessness for automation. Could we have 1 more bank teller job than 1980 and 50% more workers and make the same conclusion? More jobs doesn’t mean effectively more work for the people who fill those jobs if proportionally less of them are needed.
Bank teller jobs grew, but not nearly at pace with the growth of the whole labor force. If truck driving and other sorts of jobs are partially automated and grow at a similar pace, wouldn’t we expect the sort of people who fill those jobs now to be much worse off in the future with the higher competition (assuming population / labor force growth is still much greater)?
I also appreciate that automation may create entirely new jobs. Hopefully industry growth would include adding many of these new jobs and fill in the missing job growth, but your reference doesn’t indicate whether that was the case or not for banking. My point is to take issue with using data that only looks at one job and indicates hugely slowed growth for that job after automation is introduced and treating it as a positive.
It seems quite plausible to me that society can find a stable organization with massive automation of routine/menial jobs. However I’m concerned about the pace. It took in the (very rough) ballpark of a century for developed economies to go from the majority of the population working in agriculture to only a few percent. That’s several generations! If the more aggressive predictions about the AI-related changes we are on the cusp of are even close to correct, we’ll see similar economic migrations in a single generation.
People and their institutions don’t have a great track record at adapting to such big changes that quickly.
I just don’t believe there will be jobs for humans soon. We have a finite skill set. We have vision, hands to manipulate objects, legs to get us around, the ability to communicate and understand language, and a brain to problem solve. Machines are making rapid progress in all of these areas. Once you have an intelligent machine that can move around and manipulate objects…why would you then ever hire a human? Some say we will have that kind of intelligence by 2035. People believe new industries will be created through technology as this has always happened in the past so people will work in those new fields. However, the past never had super intelligent AI and machines with human like bodies. Once we have these things why would you ever hire a human who is lazy, incompetent, physically and intellectually weaker?
Its true that tech has created more jobs than it destroyed in the past. But i think tech vis a vis employlent moves in three stages. First stage: It will create more jobs than it destroys. Second stage: As it gets more advanced it will slowly begin to destroy as many jobs as it will create. Third stage: As it gets even more advanced it will destroy more jobs than it will create.
We have to figure which stage the tech is in.
That’s a theory but there is no evidence to support it.
I have read stories of how automation is penetrating the indian software industry. A google search about this will tell you the whole story.
Do you have any numbers showing a decline in the number of software programmers in India?
Not a decline, but i remember reading that fewer and fewer software programmers will be needed to produce the same amount of revenue for the companies. For eg: 100 billion revenues by software companies were achieved using five million employees upto the year 2015. The companies’ top management predict that the next billion in revenue can be achieved by only 3 million using software automation and other kinds of tech! Thats a potential job loss of two million in the software industry. This also have more wider effects. For example india’s domestic construction and retail sectors depend a lot on the new rising middle class which are made up mostly by these software engineers. So these two million potential job losses will affect jobs in these two sectors too. And in many more sectors like clothing, airlines, electronics….you name it. I dont remember these as the exact numbers but the percentages are around the same ballpark. You could google it though (sorry :)).
Another example: Since the rise of online shopping in india clothing has become very cheap. Due to this many more are buying more clothing than before. This is leading?lead? to more jobs initially. But another dangerous trend has begun. The price depressing effects of these companies has led to a fall in clothes prices in the retail sector. Now what will happen because of this is, this will lead to less hiring in retail. It will also lead to more pressure on cloth suppliers and textile factories to reduce their prices( who will do it by reduce their staff) and by putting more pressure on cotton traders to lower their prices who will put pressure on cotton farmers to lower their prices.
All these sectors are beginning to get affected slowly.
Not a decline, but i remember reading that fewer and fewer software programmers will be needed to produce the same amount of revenue for the companies.
We are supposed to get more productive over time. If this did not happen, most of us would still work on farms, trying to keep our kids fed.
As workers can do more things in less time, it allows us to pursue new services and products.
In 1990, hardly anyone in India worked on software or the Internet. Today, thousands do… but that was made possible because these same people are not needed to produce food and housing.
In time, we will need fewer people to keep our servers running… and this means that these people will be free to do other work.
It is a good thing.
Another example: Since the rise of online shopping in india clothing has become very cheap. Due to this many more are buying more clothing than before. This is leading?lead? to more jobs initially. But another dangerous trend has begun. The price depressing effects of these companies has led to a fall in clothes prices in the retail sector. Now what will happen because of this is, this will lead to less hiring in retail. It will also lead to more pressure on cloth suppliers and textile factories to reduce their prices( who will do it by reduce their staff) and by putting more pressure on cotton traders to lower their prices who will put pressure on cotton farmers to lower their prices.
You are pretty much describing how capitalist economies get richer over time. Things get cheap, people get more productive and so forth.
I really like this article, it offers me some new perspectives. But I’m wondering how could some developing countries whose people rely on low-paid jobs cope with this issue since their people are very likely to lose their jobs. Maybe, in the long run, technological development can help better earth residents as a whole, but in the short run, it’s a bit worrying. anyway, I’m also optimistic as well. But I think there’s a lot governments, international communities have to do to help make this inevitable trend something positive. hope to read more about this issue.
The threat of technological unemployment or, at a minimum, severe underemployment is very real in the United States and other countries with strong negative views of proactive social safety nets.
The McKinsey Global Institute estimates that 50% of current work activity will automatable, replacing as many as 800 million jobs globally by 2030. The White House Council of Economic Advisors finds that more than 80% of workers earning less than $20 per hour will lose their jobs to automation by 2036. 48% of 1,896 AI experts surveyed by Pew Research believe that AI and robotic technologies will displace more jobs than they create by 2025.
There is a strong likelihood that society will “create work that is not strictly needed,” but what will this work pay? When work fails to create economic value, by its very nature it will be less financially rewarded. This will, at a minimum, create an extreme economic disparity between the techno-capitalists that employ the robots, and the people that do the meaningless work simply to have something to do.
Forward-thinking countries need to immediately explore universal basic income or negative income tax to counter technological unemployment. The number of humans on this planet continues to grow, and there will undoubtedly be less meaningful work for humans in the future as AI and robotics replace the need for human labor.