The Luddites Are Almost Always Wrong: Why Tech Doesn't Kill Jobs

Mystakaphoros writes "Mike Masnick of Techdirt argues that we can all put down our wooden shoes and take a chill pill: technology 'rarely destroys jobs.' For example, telephone operators have largely gone by the wayside, but a (brave) new world of telemarketing and call center support jobs have opened up because of advances in technology, not to mention the Internet. Masnick points out writing from Professor James Bessen that makes the same point: 'In other cases, technology creates offsetting job growth in different occupations or industry segments. For example, word processors and voice mail systems reduced the numbers of typists and switchboard operators, but these technologies also increased the number of more highly skilled secretaries and receptionists, offsetting the job losses. Similarly, Amazon may have eliminated jobs at Borders and other national book chains that relied on bestsellers, but the number of independent booksellers has been growing and with it, more jobs for sales clerks who can provide selections and advice that Amazon cannot easily match.' That said, I think it's worth asking: if machines are going to replace all our fast food workers, are we going to start paying our gourmet chefs minimum wage just because we can?"

Comments

Sure, to lower paying jobs

[dontbgay]

The article is absolutely correct. But it also fails to take into account that the new jobs are lower paying while inflation decreases the value of the new wages.

Re:Sure, to lower paying jobs

[Mystakaphoros]

And what happens when McDonald's introduces an automatic fry-cooker, or a machine that makes hamburgers? Just because we currently have a lot of low skill service jobs now doesn't mean that they won't be replaced by technology in the future. With the advances in robotics we can all see where this is going.

Let's assume we can separate all cooks into Grade-A, Grade-B, Grade-C, and Grade-D cooks. Grade D cooks haven't spent much time practicing cooking, and are just barely good enough at it to get a job at McDonald's, while higher grades have worked longer and harder to acquire skills. A machine comes along and replaces all the Grade D cooks. They're pissed that they don't have a job, but they haven't really sunk much time into it, so they go find a different job. But now a machine comes along and replaces the Grade C cooks. A few may just be naturally talented, but by and large they've spent a lot more time (that they can't get back) training to be better cooks.

So they go to look for a new job as a pencil pusher, and sure enough, there are Grade A-D pencil-pushing jobs. Well, there were, except the grade-D pencil-pushing job has also been mechanized. Only people who start off with enough experience to get a Grade C job can get it.

So now we have someone who has trained, but their training is no longer useful. And to compound the problem, we put the onus (and the financial burden) on this person to get themselves retrained, assuming they even have the natural abilities to be a pencil-pusher.

Thankfully, technology has created a new job: computer developer. But this job only starts at Grade B, and then you can go to A and A+. To get to Grade B you need training, education, and experience, and all of that you are expected to acquire on your own time at your own expense. Also, since all those Grade-C and B pencil pushers are out hunting for work, there's increased competition, which means that employers can get you for less. So more training, but lower wages.

Re:Sure, to lower paying jobs

[OzPeter]

The article is absolutely correct. But it also fails to take into account that the new jobs are lower paying while inflation decreases the value of the new wages.

This.
 
I can't remember the source, but recently I saw a graph that showed a timeline of $US minimum wage vs inflation. Up until the the 80's or 90's the minimum wage was keeping track with inflation, but after that it flattened off. So inflation kept on going up, but the minimum wage stayed the same.

If the US minimum wage had kept track with inflation, then it would be around $13/hr or $14/hr right now. Interestingly the Australian minimum wage *is* around $14/hr

Re:Sure, to lower paying jobs

[rufty_tufty]

Any job is/becomes a minimum wage job if it meets any of the following criterion:
1) It takes relatively little training, i.e. replacements can be brought in rapidly.
2) It is a skill that is common, either because of a good education system or desirability of the task(mostly just a re-phrasing of 1)
3) The people once employed do not have much incentive to move on: i.e. they won't leave if conditions deteriorate

The capitalist in me says this is fine* as long as the minimum wage provides a basic level of acceptable living**. If you wish to have more than the minimum it is then up to you to do a job that is either undesirable or one that is both highly & unusually skilled. Alternatively if the problem with that sector is that the business owner is skimming off the profits then it is up to you to challenge that and become a business owner yourself***; take the risk and make the investment or stop complaining.
Look at some of the most successful tech companies and I don't think it is any co-incidence that they put a lot of effort into making sure 3 is not a factor by trying to have good working conditions. They need to do this because !1 is such an issue for them.

* If the employer can't afford to pay the minimum wage then capitalism should kick in and mean that they don't employ someone for that role because it is not worth it for society to do so.
** I do not believe this is the case and this needs to change. Acceptable minimum to me includes healthcare, pension and ability to support a basic family.
*** There are some sectors where again this is not an issue, one man can't decide to become the next Apple, but there are always ways into a sector if you have idea and skills and luck and are prepared to take the risk.

Re:Sure, to lower paying jobs

[jenningsthecat]

Also, since all those Grade-C and B pencil pushers are out hunting for work, there's increased competition, which means that employers can get you for less. So more training, but lower wages

More, (and more expensive) training required for jobs that pay ever-decreasing wages is an across-the-board trend. If you wonder why the middle class is disappearing, look no farther.

The growth in productive capacity of mankind - the efficiency with which we grow and harvest food, take ore and oil from the earth and process it into fuel and manufactured goods, etc, has far outstripped our population growth. Yet we have growing economic uncertainty and a shrinking middle class coincident with a period of unprecedented per capita productive capacity. Why is this so? The sound-bite answer is "concentration of wealth". The complete answer is incredibly complex - historical events, human nature, natural laws, conspiracies, and a huge number of other factors, (many of which we're likely not aware of), contribute to the situation.

What's needed, (and here's where the Libertarians, capitalists, free-marketeers, and other rugged individualist types start howling), is a re-boot of the system. Our top-heavy corporatocracy needs to have its wealth re-distributed in a more equitable fashion. We need to get over the notion that landing first in line gives anyone a claim in perpetuity to resources and privileges. I have nothing against wealth - I'd love to be wealthy myself. But when a little wealth acquired through hard work, skill, and talent is transmuted into a vast monopolistic empire holding a sword over the heads of a huge percentage of the population, something needs to change. All those anti-collectivists out there conveniently ignore the fact that corporations are collectives, and that they are also welfare recipients who game the system, and make up and impose their own rules, in order to accrue wealth and power in ways that have absolutely nothing to do with providing goods and services of value in a truly competitive environment.

If we don't all come together and change this situation in an orderly fashion, then revolution is almost inevitable, and the next one may be very bloody indeed.

Tech should make jobs obsolete

[Arduenn6058]

Why can't tech make having to go to work obsolete?

Why can't we make all the tech stuff, like robots, do all the dumb work for all of us so we can spend the rest of our lives playing, or do the kind of work we really enjoy? Isn't this the frigging thing we should strive to achieve in society? Not create more jobs, but less?

Re:Lower Wages for Gourmet Chefs?

[T.E.D.]

making welfare a more attractive option than work for many.

That just shows you how ludicrously, immorally low we have our minimum wage set to right now. However, I will admit that it is also pretty darn messed up that we have set up a system where only those here illegally (an thus unable to collect welfare) would take an actual minimum wage job, and then we yell and scream at the inevitable flood of illegal aliens who come here for all those jobs we reserved just for them. Like they are somehow more immoral for wanting a better life for their families, than are the rich folks who set up this system for them to have that role.

Absolutely False

[sl4shd0rk]

How many people in Detroit were out of work once robots started spot welding all the car frames and moving parts into position for assembly? How about Robots in manufacturing in general? Lots of people used to do those jobs. Check out How It's Made sometime. You'll see huge assembly lines full of robots where people used to stand. Hardly anyone walking around.

I've personally seen the labor force in Manufacturing facilities decline due to automated machining processes; 1 or 2 guys running 6 CNC machines where it used to take 6 people to do it manually. Polishing metal to a lustrous finish used to be a skill reserved for the 1 or 2 old German guys in the place. Now, you have CNC polishers do it in 5 different axes nonetheless.

Next, lets talk about how global connectivity has put people out of work. CNC again. You only need one programmer to transfer the machining code to some place in china where a dude running the CNC machine uploads it, puts a chunk of steel on the table , and hits the Go button. For $1.75/hour wages.

TFA is complete BS.

It's not tech, it's productivity

[bsidneysmith]

"Tech vs. Jobs" is the wrong frame, and the wrong debate. Jobs are lost, and (partially) replaced by lower-wage jobs, because of the enormous increases in productivity that increased technology (and improved management practices) brings. This should be making everybody better off--more product for less work should mean generally higher standards of living. The reason it doesn't is because our economic paradigm awards all of the benefits of increased productivity to capital, and none to labor. We need a system in which anyone who wishes can make a living working about 20 hours/week. But unless we rethink our economics we are teetering towards a crash, because the labor sector is collapsing, and capital must soon follow because it relies on a healthy consumer class--the very laborers whose livings have been pulled out from under them. If one looks at labor participation rates (instead of govt. unemployment numbers) the situation becomes quite clear.

Re:Sure, to *differently skilled* jobs

[poopdeville]

I'm a poor in America. I bought a used 25$ tv about two years. I saved for years to buy a 300$ laptop. I'll have to save for 5 years to finish my BA in math. I haven't spent a single dollar that wasn't for food, housing, or electricity in over a year. I don't have a phone or car or an air conditioner.

The dollars are stretched, and the situation is getting worse.