With the power of automation, our workers can win. Without it, they're in trouble.
Excellent. Especially use of stats and graphs to build argument.
A "progressive" who can't think of anything better for humans to do than churn out widgets on an assembly line is, ipso facto, not "progressive" in any sense of the word as I would use it.
I was glad to see this. The recent book Prediction Machines, by Agrawal, Gans, and Goldfarb, made a convincing argument, about AI rather than automation, that this won’t displace jobs in the way feared because human judgment is a complement to cheap prediction. AI creates new input and faster that has to be interpreted by humans and also allows humans to switch to more valued-added aspects of their jobs, much as ATM machines did for bank tellers, whose numbers did not decline. There may be similar effects involved with mechanical automation as with AI.
I do think there are some winners and losers and think it would be compelling to examine the largest episodes of job displacement in the past. The vast secretary pools of the 1960s through 1980s were reduced to a fraction after computers with word processors connected to printers became standard issue for office workers. I have read that the number of dock workers declined enormously as old-fashioned longshoreman work was replaced with container shipping, providing some validation to the concerns of US dock workers today (though perhaps most of these jobs would have been mechanized some other way no matter what). What happened to these vast pools of labor and what did they end up doing instead?
Back in the 60s when I was a kid we were still getting the tailwinds of the Bucky Fuller utopia era where we would soon have 25 hour workweeks due to automation. While I think that is possible if you are willing to stagnate technologically, it's human nature to want the next best thing and for that always need human labor (inventors, financers, manufacturing overseers, etc.). And of course there's always the argument that someone needs to build, program, and maintain the robots. Even if we could pull off the 25 hour workweek we'd need labor to provide the luxuries for all that freed up time---hotel workers, ski lift operators, home renovation companies (ie--the pandemic showed us how all that free time was even busier than usual), and such.
Thanks for this excellent post - it’s frustrating that people’s mindset is to romanticize difficult, low-paying, low-value-add jobs instead of embracing the need to innovate and compete globally.
Thanks Noah. I can’t speak to the economic impact of actually existing robots, but I do think the coming automation apocalypse is grossly exaggerated.
I keep reading about how lawyers are going to be replaced by AI. But the articles making that claim never explain HOW. It’s always something-something-machine-learning-mumble. The only solid task they ever mention is brief writing. Don’t make me laugh. I work tangentially but often with up and coming AI legal research products. It isn’t even remotely close - like you say, it’s pure science fiction speculation.
I’ve been a lawyer for 20 years. The only task computers have replaced lawyers in is document review. The nasty secret of law firms, though, is that you never needed lawyers to do that in the first place, and you wouldn’t need (and couldn’t have) computers take it over if the task hadn’t exploded in the last forty years because electronic communications made document review several orders of magnitude larger.
"People find new jobs to do. And their incomes generally rise as a result." Yup, there is always more to do than people to do it. And most people know what they'd like to do if they had more time to do it. If we could automate the picking and sorting of apples on our farm, then we'd have the time and resources to turn that unused second story space in our barn into a dining room and event center.
“In Sweden, if you ask a union leader, ‘Are you afraid of new technology?’ they will answer, ‘No, I’m afraid of old technology,’” says the Swedish minister for employment and integration, Ylva Johansson.
Free trade will be good for workers too, they said.
Economists sung about Free trade in their sleep. They said gains were worth it and the workers who lost their jobs could find employment elsewhere. "Don't be stupid", they said. "You don't understand comparative advantage", they said. But it's wasn't so black and white. And It's not black and white here either. 'Robots are good' vs 'Robots are bad' isn't the right framework here.
We should not mock peoples' fear. Workers have seen their own bargaining power dissipate over the past 30 years. They have been doing more for less as productivity outpaced earnings. the economy has become artificial and financialized. It's natural for workers to be weary and frightened of fundamental changes as it relates to their earnings.
Common people are the best data collectors - they see observations with their own eyes. They've seen how technology is weaponized in warehouses to track every breathe they take. They've experienced the decline in labor markets in places far remote from cities like Boston or San Francisco. We should not tell people they're just stupid.
Your worry is that fear itself will lead to irrational inaction: that the us will not embrace innovation that will help the american worker. That is legitament. And Yes, there are instances that automation will help the average worker become more efficient. But that doesn't mean as a whole, automation will help people people more productive.
In my view, the economy has almost become too productive for regular people. We've created an hyper efficient and financialized economy in which we have decreased the inputs necessary to produce output.
Automation has already been occurring. If we define automation as a system that performs without the need or use of a person's actions, then automation has already been occurring for decades as companies have found ways to cut costs and decrease payroll, and the effects of this automation has just increased the top 10% power over the American people. Have people been benefiting? Are people enjoying the wondrous gains of innovation? Do people feel productive in their life and work? Do people have creative satisfaction in the work they do? Do people feel they have more bargaining power? Not at all.
We can dream of a world in which people use automation to make their work more productive. But really, automation will just be used to decrease worker inputs. Automation is coming for knowledge workers too. And my guess is when companies begin decreasing the payrolls for data scientists and computer programmers and accountants, then there will be a cultural change against singing the joys of innovation and progressive change. Already 'Learn to code' is thrown as a mocking insult, because programming itself has become automated. It's 100X harder to create value and get paid for it by coding today than it was in 2002.
I used to genuinely believe in your dedicated, thorough, level-headed, and data driven analysis of how the world works. But lately, I don't think I do anymore. Your writing has become too out-of-touch with people's experiences.
A very good review. I recall a few decades ago my area was populated with dozens of textile mills making everything a person might wear. It employed thousands of local workers doing all sorts of jobs from starting floor workers to management. They paid well, they offered benefits, they gave people a way of life. In less than a 10-year period these jobs were moved out of the U.S. to China and Mexico, and other countries where textile companies could produce for less. They prided themselves on helping developing countries develop.
Today with automation and AI these types of jobs can and should return to the U.S. to create more jobs at levels never before seen. Less floor workers and more advanced skills in mechanization, maintenance, computer integration, and management.
The robots are available, many from China. I say buy them up, even give tax or other incentives to buy them. Doing so could create a tsunami wave of new growth and move the U.S. back to a self manufactured country rather than a net buyer from everyone else. It's our loss of market direction in this area that fuels the countries who today would want to see us decline.
Heck yeah we need more robots!
Fascinating. It shows how difficult it is to predict trends. The exception to that might be demographics, and it would be interesting to see how robotics relates to that.
Really great article! There are lots of great reasons to bring manufacturing back (as you mentioned inflation reduction, supply chain bottlenecks, inequality) but I wanted your opinion on the risks associated with this as well. I imagine short term the benefits would outweigh but long term what about demand shifts to experiences rather than goods? Will millennials still prefer vacations to new cars long term and will that affect strategy for re-shoring manufacturing?
The issue is not robotic automation. It is robotic automation plus energy independence. The world is further along (perhaps much further along) on the path to accomplishing the first. When it accomplishes both, work will change completely.
Human labor can be divided into several components. Three primary ones are calculation, innovation, and mechanism. If they are given the same inputs and are asked to do the same calculation, our machines are much better than we are at calculation.
Innovation can be broadly thought of as ideation, pattern recognition, and error recognition. We are still doing better than the machines here. The goal of AI is to change that.
Much of the world's work, however, still involves the expenditure of human energy. Automation picks off those tasks as it becomes financially feasible to do so. Feasibility boils down to two things: Our ability to design replacement systems, and the cost of building them. We are getting better at the first every day. The second is a direct result of the cost of energy. Energy to power the machines that produce and modify the materials needed to build more machines.
Classical economic theory states that when a job is eliminated, the person holding that job moves on to what is now their highest and best use (i.e. the option that maximizes their utility). Two things need to be noted. First, this is not a guarantee that the new job will be better than the old one. In general, when all resources move to their highest use, society as a whole benefits. Individuals may not. Second, there is a floor below which it makes no sense for someone to accept their new roll. At this point, they will feel that they are better off going on the dole or turning to crime. Not everyone will be useful when most jobs involve programming.
It is hard to argue with any of the observations or conclusions in this article. The US certainly should not turn its back on any helpful technology, and being the best at important ones has got to be better than the alternative. But the best argument for using robots today is this: If you need to manage a tiger, it is best to start working with it when it is a cub. We need to consider what the world will look like in ten or 20 years.
Agree that to "on-shore" and make the US a manufacturing powerhouse again, we need robots / automation and lots of it. It has to be the foundation of the rebirth of manufacturing in the USA.
And there will be a need for workers in manufacturing.
But at some point, we won't need so many workers (or more accurately there won't be jobs that capitalism finds worth in paying people to do). In particular swaths of "office work" can be expected to be wiped out by automation.
But we should welcome this! Most people hate their jobs! We need to start dreaming of a world where jobs are not a pre-requisite of survival. Daily activity should be for joy, not for survival. And we finally have the technological means to make that come true. We should insist on Fully Automated Luxury Abundance for All instead of Corporate Artificial Scarcity.
"Our workers" can win against whom? Chinese workers? They're not the ones stealing from us, cheating us, usuring us, not paying us the value of our labor, keeping our wages low, our hours long, and our rents high. You're right that automation isn't the problem, but neither is China. The problem is capital.