Do you have a job? Do you like having a job? Then I have some bad news for you. The Guardian is worried “today’s technologies are going to remove people from economic activity completely.” Techonomy says “America’s real worker crisis is not immigration, it is jobs.” Om Malik asks: “People talk about robot-helpers and an army of drones, but…what is going to happen to millions of people who will be replaced by those drones and robots?”
Wrong tense: the right question is what is happening. Henry Blodget points out “Fewer Americans are working than at any time in the past three decades.” The New York Times observes “The jobless rate remains far higher than it typically would be this far into a recovery,” quoting a factory owner: “Because it is automated, we won’t have to add a lot of employees with the upturn in the construction industry.”
It’s the same around the world. Western manufacturing jobs used to go to Chinese workers; now they’re increasingly going to Chinese robots, such as the million new robots that Foxconn is deploying.
Think you’re safe because you don’t work in a factory? Guess again. “In a move that could put millions of teenagers around the world out of their first job, Momentum Machines is creating a hamburger-making machine that churns out made-to-order burgers,” reports Gizmag. A Cornell robot can learn how and when to pour you a beer. Well, never mind food service, how about social services? …Oh. Other robots have been shown “wiping the mouth of a disabled man and adjusting a blanket.”
Retail? Forget about it. Derek Thompson writes in The Atlantic:
Retail now employs fewer people than it did in 1999. And those people work significantly fewer hours, too … Walmart, of course, isn’t the biggest threat facing retail workers anymore. That would be the inexorable growth of e‑commerce … There is a worse scenario, in which the squeeze in retail work intensifies competition for other low-skill jobs, pushing down wages at the bottom and pushing some people out of the labor force entirely. This possibility should not be dismissed too readily.
Even lawyers, financiers, and surgeons aren’t safe. The Economist observes “Intelligent machines have reached a new social frontier: knowledge workers are now in the eye of the storm … teachers, researchers and writers are next.” And in the City of London, arguably the world’s primary nexus of finance, “analysts expect [banking] job losses to keep on coming, as technology replaces jobs that people once did.”
Oh, you work in tech? Oh, well, that’s different. For now. But never forget that you’re part of a fortunate minority: “Not so much anti-union as post-union, the tech elite has avoided issues with labor by having so few laborers who could be organized.” Meanwhile, Paul Krugman warns that “We are indeed creating a permanent class of jobless Americans.”
It’s like the global economy has forked into two tracks: tech, which boomed right through the Great Recession, and just keeps booming on, and nobody can hire enough engineers…and everyone else.
It’s happening right in the heart of Silicon Valley. Colleen Taylor wrote a great piece entitled “The Other Silicon Valley,” which highlights homelessness and wealth disparity in the Valley. It in turn links to an AP piece which declares: “Simply put, while the ultra-rich are getting richer, record numbers of Silicon Valley residents are slipping into poverty.” In related news, The Atlantic notes: “Increasingly, there seem to be two kinds of stores—those in a race to the price bottom, and those closely guarding the patina of a shopping experience.”
It’s always hard to say whether economic changes are cyclical or structural, but I think it’s fair to say that there’s a slowly accumulating consensus that technology is now destroying jobs faster than it’s creating them, and that the resulting two-track economy is here to stay…and growing steadily more disparate.
Which is great for those of us in tech, right? Maybe we’re “creating a country of a few million overlords and 300+ million serfs,” to quote Blodget again, but hey, that doesn’t sound so bad to those of us who expect to be among the overlords. I mean, as long as you don’t think too hard about the ethics of it…and you don’t mind the growing resentment. The Guardian is already calling the tech elite “a cossetted caste which lords it over everyone else”. Even the East Bay Express complains “Tech has brought very young, very rich people to the Bay Area like never before. And the changes to our cultural and economic landscape aren’t necessarily for the better.”
I want to stress again that this is only the beginning — that as software eats the world, as Marc Andreessen put it, this two-track economy will grow ever more divergent around the planet. The relatively few people fortunate enough to work in technology (or have the capital to invest in it) will grow steadily wealthier, even as more and more jobs around the world are replaced by software and drones and robots.
At least I hope so.
Not because I want a tiny fraction of the world to become rich beyond Croesus while everyone else is desperately broke. On the contrary: because in the long run, this is good for everyone. People who think everyone should have a job aren’t thinking big enough.
As Gregory Ferenstein points out, technology may be destroying jobs, but it’s also creating wealth; and as I’ve argued before, the endgame of all this wealth creation, some generations hence, isn’t a world of full employment. Instead it’s a post-scarcity world of no employment, as we understand the word. Fewer and fewer jobs coexisting with more and more wealth is exactly what you would expect on the road to that outcome.
Trouble is, our societies and economies are built around the assumption of mass employment, and we’ll need some pretty wrenching adjustments to that paradigm to deal with the changes to come. Some are already stealthily underway. As NPR reported earlier this year:
In the past three decades, the number of Americans who are on disability has skyrocketed. The rise has come even as medical advances have allowed many more people to remain on the job, and new laws have banned workplace discrimination against the disabled. Every month, 14 million people now get a disability check from the government … The vast majority of people on federal disability do not work. Yet because they are not technically part of the labor force, they are not counted among the unemployed.
In other words, the US government is already quietly paying a significant fraction of the American population not to work. If jobs keep disappearing, while the overall wealth of America and the world keeps increasing, then we can expect initiatives like that to keep expanding. George Monbiot is the latest to propose a basic income, which “gives everyone, rich and poor, without means-testing or conditions, a guaranteed sum every week.”
It’s been suggested that, along with “peak jobs”, America has also hit “peak capitalism.” (Go read that piece; it’s quite interesting.) And it’s true that a basic income would probably be an indicator of that. But before conservatives get apoplectic, let me point out that a close relative of a basic income, the negative income tax, was championed by none other than free-market hero Milton Friedman.
(Also, right-wingers, which would you rather have; tens of millions of unemployed people being paid subsistence-level amounts by the government, or those same tens of millions, desperate and starving, marching on San Francisco and Manhattan demanding blood? Remember the French Revolution? That didn’t work out so well for the aristocrats, did it? Let them eat cake, smoke pot, and play video games, is my advice.)
So the good news is, if you lose your job some years from now, with any luck the same technological advances that devour it will also have generated enough wealth that the government will pay you and your family a basic income while you’re unemployed. The bad news is that you’re not likely to get another long-term job–ever–and that basic income will probably be only just enough to scrape by on.
Do you believe education will save you, and/or your children? Sorry. Not all of the well-educated will find good jobs; increasingly, some won’t find jobs at all. Meanwhile, the cost of higher education keeps climbing higher and higher. Peter Thiel is already arguing that “we’re in a bubble and it’s not the Internet. It’s higher education.”
It’s possible that universities will start to seem almost like casinos: great for the winners, but you’d actually be better off not going at all than paying to go and failing to win. Obviously an engineering or CS degree will improve your chances much more than, say, English Lit…but not everyone can be a tech worker, and what’s more, it’s only a matter of time before technology starts eating tech jobs, too.
If this scenario plays out, the world will divide into a dwindling minority of the very rich — tech workers, finance barons, and those who inherited their wealth, mostly — living in a handful of idyllic cities dripping with wealth, and/or their summer homes on nearby beaches, lakes, and mountains … and the majority who barely get by, doing occasional contract work or odd jobs for a little extra money, too poor to even visit the places where the rich live, work, and play. Aside from those few with government jobs, there’ll be hardly any middle class at all between those two groups.
Does that sound implausible or unstable? No: it’s how most of the world works today. That’s a reasonable description (albeit to varying degrees, and in varying forms) of Brazil, Russia, India, China, and South Africa today. Until recently the expectation has always been that they would evolve and grow to become more like North America, Western Europe, and Japan. But it seems likely to me that the converse is true–that for the next few decades, at least, the rich world, even as it grows wealthier, will begin to look a lot more like the BRICS. It’s a sobering thought.