The rapid pace of automatization is going to disrupt the labor market, and unemployed voters will want answers
By Benjamin Hayward
The driverless car just makes sense. It will be safer than having a human behind the wheel. It will make urban traffic more efficient when they fill the roads. And it will be cheaper to hire than a taxi with a human driver. Sooner or later, driverless vehicle technology is going to put every freight operator, delivery person, and taxi driver out of a job.
The problem that policymakers and business leaders must face is that machines don’t vote and unemployed people can’t afford to buy the newest driverless car.
The history of innovation is the story of technology replacing labor. From the agricultural revolution, to the industrial revolution, to the manufacturing revolution, and now to the IT revolution, new developments have allowed fewer people to achieve more. At the start of the last century, 38 percent of American workers were employed on a farm, but today’s technology allows less than 3 percent of workers to produce substantially more food.
Jobs have always been lost to technology, yet those technological developments enriched society overall. So why is there cause for concern now?
The difference lies in the rate of change. When industries go through slow transformations, the workforce has more time to adjust, and the supply-and-demand of the free market keeps unemployment more or less in equilibrium. Throughout the 20th century, increasing automatization in manufacturing and agriculture moved workers out of jobs in those sectors and into service-providing industries, which, as defined by the U.S. Bureau of Labor Statistics, increased from employing less than a third in 1900 to now fully 80 percent of all American workers.
In the 21st century, it is the service sector that now faces automatization. It is not literal robots, however, that will replace humans behind office desks and bank teller windows, as happened on the assembly line. The rapid pace of technological breakthroughs is not so much in robotics as in computing infrastructure.
Automatization of the service industry is already under way. The number of bank tellers substantially decreased with the introduction of ATMs that could handle many of the simpler transactions. The various jobs that occupied office secretaries have already been usurped by personal computers. At home, fewer and fewer people need tax help when a computer program fills the role.
The more computers can do, the less humans will be hired to do. And the capability of computing technology is …
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