Computers Took Our Middle-Class Jobs

The peak of the American economy before the recent recession happened at the end of 2007, when the GDP was 13.33 trillion$ and 138 million people were employed. After almost 4 years (three times longer than our average recovery time), the GDP is finally back above that level, to 13.35 M$ — but with 7 million fewer workers. Those people have been replaced partly by their former, more productive co-workers who picked up the slack, partly by cheaper workers in India, China and the like, and partly by computers who have gotten a lot more adept at doing sophisticated things around the office.

For example, there’s a lot less need for secretaries these days: between Outlook, GMail, the decline of postal mail, easy-to-use calendars with reminders on all the smartphones, files becoming electronic without need for filing (thanks to Google desktop search), and now even Siri, a lot of a secretary’s job has been largely replaced by software from Google and Apple. Travel agents have been replaced by Travelocity and Expedia (dot cooom). Accountants, by Excel, Turbotax, and Mint. Broadcast engineers, by streaming Internet video. Police and security officers, by cameras and security systems. Paralegals, by scanners, optical recognition, text search software, and the Internet. Librarians, by Google Books and Amazon. Bank tellers, by ATMs.  Even bakers, by vending machines. All middle class jobs that are disappearing.

And that’s just the beginning: Watson — the IBM computer that mopped the floor at Jeopardy! with the two best people that ever played the game — is going to replace all kinds of Jeopardy! contestant-like jobs that depend on recalling trivia from large amounts of knowledge: doctors, lawyers, government employees, etc. Of course, technology doesn’t eliminate those jobs completely: we’ll need surgeons, trial lawyers and DMV clerks for the foreseeable future. Same goes for the other jobs (e.g., we’ll always need some accountants and traffic cops), because we’re unlikely to ever automate everything, but what will happen is that one person will be able to do the job of several. Agriculture was one of the first industries to become automated, and now a couple of people can run an entire giant farm that used to take dozens; over the past century, those jobs went from 38% to 2% of the workforce.

 

Watson on Jeopardy!

 

As a specific example of what’s coming, NPR has an article that highlights how disruptive automation will be to the auto industry: in the past 30 years more Americans have been killed by cars than by all the wars in the past 300 years — 1.5 million people. Because of that, and also because they’re really cool, driverless cars are coming to improve safety and efficiency. When they do, right off the bat, they’ll put a lot of people out of work: taxi drivers, valets, bus drivers, traffic cops, etc. And people that don’t drive too often may forego owning a car altogether and just use services like Zipcar; this means less need for mechanics and parking maids, less government revenue from drivers license fees, registration fees, traffic tickets, parking tickets, etc.

 

Google's driverless car. Illustration by The Globe And Mail

 

One interesting thing is that lower-skill jobs are not yet being targeted by robots, because those jobs tend to pay too little and aren’t worth replacing by an expensive machine that does them probably much worse: all kinds of cleaning jobs (janitors and maids, garbage men, bus boys), fast food cooks, animal caretakers, etc. And then there are the jobs no one wants to see a machine doing, mostly in the service industry: waiters, receptionists, nannies, hair dressers, retail salesfolk. Because of the high-cost and largely impersonal nature of middle-class jobs, it’s mostly those that are at risk for being replaced by machines.

So what do you do when the metal ones decide to come for you? Besides getting Old Glory Insurance, re-education is pretty much the only alternative to hoping you’re one of the few that get to stay behind. The loss of jobs to automation is nothing new and has been an issue since the days of John Henry, almost 150 years ago. And so far, every time an industry is disrupted by machines, a new industry pops up to take its place and create the new jobs needed. For example, when agriculture started to decline, radio and television were invented, as were cars and airplanes. Now, at the very least, we’re going to need people to design all those new robots… until someone builds one that can reproduce.

And in case you’re interested in some of that robot insurance:

From NPR, NPR, Forbes and Bloomberg

3 Comments.

  1. The American Educational System Is Just Fine | Apt46 - pingback on June 6, 2012 at 8:34 pm
  2. Computers Make More Accurate Diagnoses Than Doctors | Apartment 46 - pingback on February 15, 2013 at 10:09 pm
  3. The Driverless Car Leading The Blind | Apartment 46 - pingback on February 15, 2013 at 10:12 pm

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