This space was going to be spent on the Transhumanism series, but this issue has been popping up in my feed pretty consistently for the past week. That issue being: do American workers have to fear technology/robots taking their jobs?
This particular worry has always been a theme in American manufacturing labor, stretching back before Ned Ludd. In the aftermath of the free-trade agreements, and China joining the World Trade Organization, that saw American manufacturing lost or shipped out-of-country, our economy shifted from making hardware to knowledge and skilled work.
The worry is more pronounced now because machines aren’t merely being used for unskilled jobs anymore; they are becoming much more specialized, which has let job-loss anxiety creep into skilled job networks.
Paul Krugman set off a discussion earlier this week in his New York Times blog.
Indeed, recent college graduates had stagnant incomes even before the financial crisis struck. Increasingly, profits have been rising at the expense of workers in general, including workers with the skills that were supposed to lead to success in today’s economy.
Why is this happening? As best as I can tell, there are two plausible explanations, both of which could be true to some extent. One is that technology has taken a turn that places labor at a disadvantage; the other is that we’re looking at the effects of a sharp increase in monopoly power. Think of these two stories as emphasizing robots on one side, robber barons on the other.
About the robots: there’s no question that in some high-profile industries, technology is displacing workers of all, or almost all, kinds. For example, one of the reasons some high-technology manufacturing has lately been moving back to the United States is that these days the most valuable piece of a computer, the motherboard, is basically made by robots, so cheap Asian labor is no longer a reason to produce them abroad.
In a recent book, “Race Against the Machine,” M.I.T.’s Erik Brynjolfsson and Andrew McAfee argue that similar stories are playing out in many fields, including services like translation and legal research. What’s striking about their examples is that many of the jobs being displaced are high-skill and high-wage; the downside of technology isn’t limited to menial workers.
Krugman later admits that this topic hasn’t been discussed at any great length and merits a good therapy session. (I agree.) Over at Financial Times Alphaville, for Izabella Kaminska the worry lies in the unequal access to technology that will ultimately hurt workers. Countering both, Tim Worstall at Forbes says that mechanization will make everything cheap, ergo:
And if everything costs the monetary equivalent of spit then we don’t have rising inequality at all: actually, what we’ve got is the arrival of true communism. For here’s a little known point that I like to make. We don’t actually care about jobs: don’t care if no one at all has one. We also don’t care about incomes: it’s not a problem if everyone has very low incomes. What we actually care about is that everyone has the opportunity to consume. And there are various ways that this can be provided. One of them being that incomes fall but that the costs of things fall even faster. Who is richer as measured by the ability to consume cars, someone on $30,000 a year and a car costs $20,000, or someone on $15,000 a year and a car costs $5,000?
Worstall makes a fairly big mistake in his article. That is, if we adopt manufacturing processes that will make goods cheaper, the inequality gap will disappear (the “arrival of true communism.”) Undoubtedly, access to cheaper goods will be there but that doesn’t account for the ability, or inability, to buy those cheaper goods. You need income to do that. Where will your wage come from if you’ve been replaced by a robot?
Let’s assume that robots have really begun to replace highly specialized jobs and that means workers in the economy will have to shift careers. That requires re-training, which is really expensive and moving robots into select sectors will probably not have an effect on the cost of that education. I imagine an explosion of student debt will occur, unless we move to a universal higher education system a la Denmark (which then means higher taxes.)
With the kind of capitalist economy we have, the cost of having these robots do skilled, high-paying jobs will be shifted somewhere. I imagine that the working and middle classes will bear a lot of that cost in re-training, changes in lifestyle, relocation, so on and so forth. When America lost our manufacturing economy, we lost export capacity and came into an economy that, eventually, started holding on by a thread (thanks, in part, to reliance on credit and debt.) I can only wonder what will happen to our skilled workforce if they’re replaced by robots, and the next economic crash occurs. That’s my cynicism of replacing humans with robots in the American economy, and makes me sympathetic with Kaminska’s article.
Under a different set of circumstances, I am agnostic about using robots for any job if they can do the job better, and, optimally, I would be for it. If we were talking about a country that already works toward closing the inequality gap (like the social democratic-oriented countries,) then I would share Worstall’s view. In those economies, it would be easier to re-tool and re-orient yourself (also assuming that you’re young enough to do so.)