Automation is not the Industrial Revolution

expertThe ‘experts’ are at it again, warning that Mankind is at a ‘tipping point’ as automation and AI begins to replace us in a ‘long and painful process’. Is it time to set your hair on fire, or are they blowing smoke?

Many economists say there is no need to worry.

And economists are well known for the accuracy of their predictions. Also, how many is many? A dozen? A hundred?

They point to how past major transformations in work tasks and labor markets – specifically the Industrial Revolution during the 18th and 19th centuries – did not lead to major social upheaval or widespread suffering.

Well, they would be wrong. The industrial revolution caused a huge social upheaval as the guild system fell apart, people migrated to the big cities to find work, and the poor were sent to work houses and debtors prisons if they were unable to pay their bills. An entire class emerged, growing out of the merchant class, of rich industrialists and money lenders. And compared to today’s pace of change, the industrial revolution was glacial.

These economists say that when technology destroys jobs, people find other jobs. As one economist argued, since the dawn of the industrial age, a recurrent fear has been that technological change will spawn mass unemployment. Neoclassical economists predicted that this would not happen, because people would find other jobs, albeit possibly after a long period of painful adjustment. By and large, that prediction has proven to be correct.

But that was in a time when people who had previously produced small quantities of expensive goods could be employed in factories to produce large quantities of inexpensive goods. The AI/robotics revolution will replace those who do the simplest most repetitive things first. While those capable of doing things that are more sophisticated than the current level of automation can and will adjust, eventually there will be those who cannot. They will then join the ranks of those no longer looking for work.

They are definitely right about the long period of painful adjustment!

Fortunately, it will be gradual adjustment, though there may be some large steps. For example, if long haul trucking suddenly becomes much more cost effective due to driverless vehicles, a big chunk of the workforce may be displaced very quickly. But automation will take some time, and will move incrementally.

The stabilizing influence of the modern social welfare state emerged only after World War II, nearly 200 years on from the 18th-century beginnings of the Industrial Revolution.

The welfare state is likely to become a hugely destabilizing influence as countries continue to spend far beyond their means to sustain it. Automation will add fuel to that fire, when the welfare rolls swell as the poor are displaced by machines.

Today, as globalization and automation dramatically boost corporate productivity, many workers have seen their wages stagnate.

The global corporations are stripping the wealth of those they enslave through the taxation of the welfare state. They maintain their death grip on the world through lobbying, bribing those in government to enact unjust laws that allow the rape of the very people who elected them. These days, the free market is anything but, and the global elites are every bit as evil as the communists were.

When steam power and industrial machinery came along in the 18th century, economic activity took off. The growth that happened in just a couple hundred years was on a vastly different scale than anything that had happened before.We may be at a similar tipping point now, referred to by some as the ‘Fourth Industrial Revolution,’ where all that has happened in the past may appear minor compared to the productivity and profitability potential of the future.

But this time, it will be productivity benefiting the few. Automation may decrease the cost of goods further, but how will that help those with no money to buy them?

By substituting technology for workers, U.S. manufacturing productivity roughly doubled between 1995 and 2015. As a result, while U.S. manufacturing output today is essentially at an all-time high, [manufacturing] employment peaked around 1980, and has been declining precipitously since 1995.

As I said, it will be a long, gradual change.

A recent report from the International Labor Organization found that more than two-thirds of Southeast Asia’s 9.2 million textile and footwear jobs are threatened by automation.

And what will they do when these jobs are lost?

Accountants, lawyers, truckers and even construction workers – whose jobs were largely unchanged by the first Industrial Revolution – are about to find their work changing substantially, if not entirely taken over by computers.

I find it hard to believe that lawyers will be entirely replaced. We’ve been chipping away at accountancy with spreadsheets and software for decades; you still need someone to run it for you. Even in construction, there will likely be a need to have someone to prepare jobs for machines due to the chaotic nature of job sites. Truckers are likely to go first, but I agree that more automation is heading for all these professions.

Ariel Rubinstein’s assertion that economic theory tells us more about economic models than it tells us about economic reality, is a warning: We should listen not only to economists when it comes to predicting the future of work; we should listen also to historians, who often bring a deeper historical perspective to their predictions.

+1 on Rubinstien’s assertion. The past can offer some help, but the coming revolution won’t be like any that have come before.

Automation will significantly change many people’s lives in ways that may be painful and enduring. There is an 83 percent chance that artificial intelligence will eventually takeover positions that pay low-wages, says White House’s Council of Economic Advisors (CEA). A recent report suggests that those who are paid less than $20 an hour will be unemployed and see their jobs filled by robots over the next few years. But for workers who earn more than $20 an hour there is only a 31 percent chance and those paid double have just a 4 percent risk.

This is a gross generalization. There are kinds of work that require high effort that will resists attempts at automation. For example, gardeners won’t be replaced any time soon, though they may be employing robot mowers. Artists, writers, and other creative professionals are likely to be safe for a long while yet. The truth to this generalization is that the jobs that will be automated first will tend to be those that pay the least, because they require the least skill to perform.

To reach these numbers the CEA’s 2016 economic report referred to a 2013 study about the ‘automation of jobs performed by Oxford researchers that assigned a risk of automation to 702 different occupations’.

This study doesn’t hold a lot of water. It’s highly subjective. Check out my post which covers it: More Automation Scaremongering. This means the above assessment of percentages of jobs automated at different wage levels is on shaky ground.

Council of Economic Advisers Chairman Jason Furman noted that the threat of robots moving in on low-wage jobs is, ‘another example of why those investments in education to make sure that people have skills that complements automation are so important,’ referring to programs advocated by President Obama.

These programs will help those capable of learning such skills. Take a look at Modern IQ ranges for various occupations. Many of the jobs that are susceptible to automation (for example, truck driving) are the same jobs that are among the few attainable by those who are on short end of the intellectual spectrum. Training can only do so much. You are highly unlikely to retrain a janitor as a mathematician.

About jimbelton

I'm a software developer, and a writer of both fiction and non-fiction, and I blog about movies, books, and philosophy. My interest in religious philosophy and the search for the truth inspires much of my writing.
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1 Response to Automation is not the Industrial Revolution

  1. Pingback: Is Automation OK After All? | Jim's Jumbler

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