Technology is Killing Jobs for Skilled, College Educated Workers

In my 2009 book, The Lights in the Tunnel: Automation, Accelerating Technology and the Economy of the Future, I argued that advancing technology — and especially software automation — would increasingly threaten the jobs taken by college graduates, and might eventually undermine the incentive to attend college. At the time, this was a very unconventional view. Here’s part of what I wrote:

The unfortunate reality, however, is that the college dream is likely at some point to collide with the trends toward offshoring and automation. The fact is that college graduates very often become knowledge workers. These jobs — and in particular more routine or entry level jobs — are at very high risk from automation. The danger is that as these trends accelerate, a college degree will be seen increasingly not as a ticket to a prosperous future, but as a ticket to a job that will very likely vaporize. At some point in the future, the high cost of a college education, together with diminishing prospects for college graduates, is likely to begin having a negative impact on college enrollment. This will be especially true of students coming from more modest backgrounds, but it will have impact at all levels of society.

This is, obviously, a very unconventional view. Most economists and others who study such trends would probably strongly argue exactly the opposite case: that in the future, a college degree will be increasingly valuable and there will be strong demand for well-educated workers.

This is essentially the “skill premium” argument — the idea that technology is creating jobs for highly skilled workers even as it destroys opportunities for the unskilled. I think the evidence clearly shows that this has indeed been the case over the past couple of decades, but I do not think it can continue indefinitely. The reason is simple: machines and computers are advancing in capability and will increasingly invade the realm of the highly educated. We’ll likely see evidence of this at some point in the form of diminished opportunity and unemployment among recent graduates and also among older college-educated workers who lose jobs and are unable to find comparable positions.

We may not see an actual closing of the gap in aver-age pay for college v. non-college graduates because opportunities for workers of all skill levels are likely to be in decline. I am not suggesting that high school graduates who would have otherwise gone to college will choose to remain completely unskilled, but I do think there is likely to be a migration toward relatively skilled blue collar jobs if there is a perception that these occupations offer more security.

As new high school graduates begin to shy away from a course leading to knowledge worker jobs, they will increasingly turn to the trades. As we have seen, jobs for people like auto mechanics, truck drivers, plumbers and so forth are among the most difficult to automate. The result may well be intense competition for these relatively “safe” jobs. As high school graduates who might previously have been college-bound compete instead for trade jobs, they will, of course, end up displacing less academically inclined people who may have been a better fit for those jobs. That will leave even fewer options for a large number of workers.

Economists are now finding hard evidence that this trend has been underway since 2000. In a recently published paper, three Canadian economists argue that there has been a “great reversal in the demand for skill and cognitive tasks.”  Here’s part of the abstract for the paper:

Many researchers have documented a strong, ongoing increase in the demand for skills in the decades leading up to 2000. In this paper, we document a decline in that demand in the years since 2000, even as the supply of high education workers continues to grow. We go on to show that, in response to this demand reversal, high-skilled workers have moved down the occupational ladder and have begun to perform jobs traditionally performed by lower-skilled workers. This de-skilling process, in turn, results in high-skilled workers pushing low-skilled workers even further down the occupational ladder and, to some degree, out of the labor force all together.

At present, high percentages of high school graduates are continuing to enroll in college, often taking on punishing levels of debt in the process. As nearly any recent college graduate knows, many of these people are ending up working in lower wage service jobs (Baristas for example).  I think it is entirely possible that future high school graduates will begin to look at these outcomes begin shying away from college.

Inexpensive online education may offer a partial solution, but it won’t necessarily address the fact that the most important incentive for seeking further education is being undermined. If there is no job waiting after all that work, a great many people probably won’t be motivated to make the investment, and the result may be a less educated population. In a world that is becoming increasingly complex and connected, and in a future that will hold unprecedented global challenges, the last thing we need is an an even less informed and educated population and electorate.

I think this is perhaps one of the greatest challenge we will face in the future. As technology destroys both high and low skill jobs, the conventional solutions — nearly all of which tend to emphasize still more education and more training — are very likely to be ineffective. A great many people will do all the right things but nonetheless fail to find a foothold in the economy of the future.  What will we do then?


52 thoughts on “Technology is Killing Jobs for Skilled, College Educated Workers

  1. Sadly, this is generally true. However, this morning a coworker with two engineering degrees told me that recently as automation is deployed the layoffs have been the less educated. And they hire the highly educated to maintain the systems. This reminds me of the novel Player Piano by Kurt Vonnegut.

  2. I’ve read “Tunnel” and I respect the logic and evidence of technology-induced loss of employment. Given the book is nearly 4 years old, can you udate us on what types of employment are least likely to be affected in the next 5-15 years? What types of livelihoods might be created? …and after 15 years – anything left? We can’t all drive trucks…

    “As we have seen, jobs for people like auto mechanics, truck drivers, plumbers and so forth are among the most difficult to automate. “

  3. This is a ‘distribution problem’, and little more. In order to deal with this problem, all we need to do is either borrow or print money and give it to people. Using the MMT framework, there is nothing preventing the United States government from doing this indefinitely…until (if) inflation ensues. I don’t see significant real resource constraints outside of energy, natural resources, carbon dioxide emissions, perhaps land, etc.

    So maybe you tax those things that are truly finite and non-renewable to ensure we don’t exhaust our nonrenewables. And if inflation does ensue, you levy taxes to extract money back out of the economy.

    This ensures two things:

    (1) we avoid an aggregate demand death spiral [as outlined in your book]
    (2) the working class doesn’t starve to death

    You can call this the ‘star trek model’: post-scarcity basic income guarantees

    1. Nick, MMT is chartalism, which is not applicable to the US debt-money system.

      The US gov’t does not create “money”. The US has a debt-money system in which all money is lent into existence by private banks (including individuals, banks, insurers, pensions, etc., lending to the federal gov’t to run a fiscal deficit) at imputed compounding interest claims to wages, profits, and gov’t receipts in perpetuity. The owners of the banks own the Fed and the gov’t who makes the rules. The Fed is a private corporation owned by the banks that in turn are owned by the top 0.1-1% of households who effectively own all of the debt-money and associated claims to wages, profits, and gov’t receipts.

      The bottom 90% only borrow the debt-money owned by the top 0.1-1% and circulate it for subsistence, if they are lucky.

      The next 9% below the top 1% own subordinate claims on the debt-money assets of the top 0.1-1%.

      Today, total US credit market debt owed ($54 trillion) has an imputed cumulative compounding interest claim equivalent to US GDP; that is, all existing and incremental US economic exchange/activity is already pledged to the debt service costs of the existing debt-money assets of 350% of GDP. The larger the deficits and the longer these deficits continue, the larger the future imputed interest claim on wages, profits, and gov’t receipts until one day the net interest on US gov’t receipts after Social Security and Medicare receipts reaches the critical 20-25% threshold, and we join the PIIGS and Japan as de facto insolvent.

      Please investigate chartalism, its origins, history, and outcome, and compare against what I have written above. Then share with family, friends, colleagues, and acquaintances. Chartalism is not a viable solution to our dilemma today.

      All of this having been written, I am convinced that accelerating automation of labor worldwide, evolving smart/intelligent systems, global interconnectedness, ubiquitous nano-electronic and biometric sensing and monitoring, robotics, photo-electronic/quantum computing, and offshoring of labor will result in a once-in-history disruption to the division of labor, system of economic exchange and distribution of income, loss of purchasing power of the bottom 80-90% of households, and a collapse in gov’t receipts and gov’t services that will effectively bring an end to the oil-, auto-, and debt-based mass-consumer economic system and society.

      I do not believe that this is hyperbole or gloom and doom; rather, it is the logicial extension of the evolution of capitalism from agrarianism, industrialization, post-industrialization, rentier financialization, and ultimately to a post-capitalist, post-growth, post-Oil Age epoch in which capitalist exploitation of labor and resources can no longer be sustained AND allow for growth of real GDP per capita and permit the vast masses of the 7 billion human beings to subsist, let alone thrive, reproduce, and self-actualize, if you will.

      Economics as it as evolved since the 18th and 19th centuries to a kind of imperialist intellectual rationalization for perpetual growth of population, resource extraction and consumption, debt, profits, and waste on a finite planet is wholly unprepared to provide the informed analysis, innovative thinking, and creative solutions for the post-capitalist, post-growth epoch we face in the decades hence.

      There is much more to share and discuss, but I will leave it there.

    2. This is not just about the middle class… This will effect almost everyone…

      A thought… If we no longer need to work.. maybe that will change entirely… We focus on enlightenment and education instead of working… it becomes a certificate system if you will..

      Everyone gets a certain amount of everything depending on population and resources… And those who have committed a criminal act (this would then be rare) would be the ones who would be then sentenced to work the few remaining jobs…

      There will be horrible suffering before this transformation ever became if ever… We will always have those in need of power…

      Nice thought though…

      We will most likely be hit by an enormous asteroid or our technology will be taken out by a solar flare first… and that starts a whole new beginning…

  4. I am disputing the basic argument but won’t there still be room for a “creative” class?

    I am not talking about arts and crafts, but about the people that decide what technology needs to do – people like Steve Jobs and the hundreds of people like him but with much lesser roles.

    1. “Steve Jobs” creative, hah. He stole every idea he ever “had”.

      Society will always have room for thieves, though, so sadly that statement is correct.

    2. No.. because computers will be able to come up with creative ideas through analysis and history and they would do this with incredible speed at limited cost…

      Basically it’s the same behavior as the human mind only much quicker… They learn faster… Thus can tell if the idea, even creative, is feasible…

  5. I’m just going to copy in here the comment that I put on my G+ post for this article:

    This is a nice blog post by Martin Ford, but I don’t think his conclusion that fewer people will be college educated really follows. Why not? Because the data still clearly shows that college graduates make more and have much lower unemployment. I don’t see that changing either. The simple reality is that someone with post secondary education has more options than someone without one.

    I do think that we are moving in a direction where large segments of the population are unemployable, but I think the interaction with education is going to be more complex. I feel like changes are going to come in waves and these waves will be overlapping. The first one, which I believe we are already in and I have written about on my blog, is that choice of major for college graduates starts to matter more. As more people think about the ROI of college, majors in STEM and business are going to go up while humanities and social sciences go down. I think that there are strong arguments that we want well rounded college grads, but the data on earnings by college major make it very clear that all majors don’t have the same ROI even though they generally all have the same up front cost.

    A second wave I see hitting is a reduction in the cost of education. This is why I don’t think Martin’s conclusion follows. He assumes college continues to be expensive and that it leads to debt. I think that the current rise of the MOOCs points to an alternative in which even more people get a post-secondary education, but they do so using technology based services that scale and hence have very low costs per student.

    With this change we should also see the nature of higher education change and a lot more continuing education open up, because it is so cheap. The last paragraph that Martin quotes from his book shows perfectly why I don’t think any jobs that don’t involve higher level creativity are really very safe. He specifically mentions “auto mechanics, truck drives, plumbers and so forth are among the most difficult to automate.” Of course, we know that one of those three is well on the road to automation. There will be no professional truck drivers in 20 years (I expect them to disappear in 10-15 years as the first publicly available autonomous cars should be on the road in 7 years). Based on what I am seeing with robotics, I don’t think auto mechanics or plumbers are really any safer. In the case of auto-mechanics, I think the nature of cars will change and along with those changes, they will be built so that they aren’t intended to have human mechanics working on them. Plumbing won’t even need that.

    Martin’s point that this is hitting upper end jobs is well taken though. This isn’t just blue collar. There are white collar jobs that are being hit hard and more will be hit. I’m sure that is what is power the results of the paper he links to, though it doesn’t seem to match with other analyses I have seen where they break employment down in other ways. Other studies tend to show that any job that is very methodical in nature, whether high or low skill, is getting cut down. If this study didn’t make a similar cut, it is possible that the methodical high skill jobs fall enough to drag down all of the high skill positions.

    Personally, I think that the next two areas of the economy that are ripe for disruption are medicine and education. I pointed to education above and I share many things on G+ that talk about medicine. This is going to hit some of the most educated people in the nation and it completely alters the demand for M.D.s and Ph.D.s in the US.

  6. “He specifically mentions “auto mechanics, truck drives, plumbers and so forth are among the most difficult to automate.” Of course, we know that one of those three is well on the road to automation. There will be no professional truck drivers in 20 years (I expect them to disappear in 10-15 years as the first publicly available autonomous cars should be on the road in 7 years).”

    No. I don’t see mechanics going away. People still pay for their computers to be fixed, and that is simpler than car repair. Even if a brand new line of vehicles was produced that didn’t need mechanics, there would still be millions of older vehicles requiring mechanics (not to mention trains, and other heavy vehicles!). Plus, the brand new line would require human mechanics in situations where the robotic mechanics are too expensive.

    Where are plumbers going? Nowhere. Find me a robot cheaper than a man who will install and repair pipes etc!

    The boom will be in trade schools. Robots must be fixed, tyres changed and patched, cars repaired etc. Maintenance will be the thing to do if you can’t program the robots.

    We will need doctors; it’s just that diagnostic medicine will take a hit with Watson improving. Radiologists will be under threat but it will take a while before they are phased out. Higher education will take a hit – the employment rate for STEM is falling. This will be reflected in enrollment rates.

    1. Marion, you are saying the same types of things everyone said about truck drivers 5 years ago. It was going to be too hard and too expensive. Turns out that logic doesn’t work for truck drivers. It won’t work for these other professions either. Have you seen Baxter? He’s not ready to be a mechanic or a plumber today, but I don’t think he is all that far off. Plus, he only costs $20k. When he is ready to make that jump he will cost a heck of a lot less than the humans.

      There will be need for humans doing repairs at a certain level, but why can’t robots repair robots? They are able to build them in the first place.

      Doctors are going to be downsized by things like Watson and personalized health data. There will still be doctors around, but we will use them less because we will be able to have so much of our healthcare taken care of virtually. Radiologists are already at the point where students probably shouldn’t go into it.

      Can you provide stats showing that the employment rate for STEM is falling? I can show you that the employment rate for non-college graduates sucks. I can also show data that STEM majors make more than humanities and social science majors. In the longer run this is a battle of attrition because the machines are getting better faster than the humans can. Employment across all fronts is going to go down. The question is, which ones hold on the longest. CS and Engineering are part of STEM. I know that their employment numbers aren’t going down. As you eluded to, being able to program the robots is one of the best positions you can have.

  7. I think a more plausible answer as to where the plumbing and mechanic jobs will go is self-service rather than Baxter. If plumbing and car repair change so that a machine can do them, then, in a downsizing economy people will do such repairs themselves.

    I can see a Watson repair program scanning the situation from your tablet and advising you what to do to fix your car, seal your leaks etc. thus allowing for self-service rather than robotic replacements of plumbers, mechanics etc.

    The engineers will take a hit. The more reliable the robots and machines become, the greater the tendency to simply repair or replace rather than re-design. Think of software; why upgrade to the latest and greatest if your ten-year old program works? The boom will be repair. If repair is simple enough for a robot to handle it, then humans can do it with Repair Watson guiding them along the way.

    1. Marion, I don’t undersstand this quote, “If repair is simple enough for a robot to handle it”. Did driving get simpler for the Google car to do it? Also, if some things are redesigned for robots to work on them, that doesn’t mean it gets easier for humans. Indeed, I can see it becoming pretty much impossible for humans. Robots don’t have the limitations humans do when it comes to things like getting tools into tight spaces. A device intended for robot servicing could take out a lot of the empty space and make it so humans really can’t work with it.

      Having said that, I think we see a split where people who can afford to not repair things will pay for the robots to do it. Others will do it themselves. I see this type of split going through society in many ways as more people are pushed out of the workforce.

  8. Marlon, I don’t understand this quote, “If repair is simple enough for a robot to handle it”. Did driving get simpler for the Google car to do it?

    Driving is much easier than auto repair. More people can drive than fix the car. You hear a noise in the front end – what’s causing it? Axle? Ball-joint? Spring mount etc?

    For a robot to fix a car the diagnostic software must come first. The software need not be tied to the robot, and even if it is, there is profit in selling it separately, so people will have it, and will be able to do their own repairs.

    “A device intended for robot servicing could take out a lot of the empty space and make it so humans really can’t work with it.”

    Open your car bonnet; no acres of empty space there. In fact one might need more space, and a simpler design for the robots to work.

    But the big problem for me is this: What are those in power going to do to the rest of us? Most of us, no matter how bright or talented, will not be employable if present trends continue. Will it be war? Disease? Or simply feudal times: mighty lords in hi-tech castles and estates guarded by robots and loyal servants while the rest are left to fend for themselves in crumbling cities with occasional handouts?

    1. More people can clean a house than drive a car. Does that make cleaning a house easier than driving a car? No. Most diagnostics on cars these days are already done through computer systems and because of that, you see very few people trying to fix their own cars if they are recent models. Sure, I helped my car work on cars back in the 80s and 90s, but by the late 90s it became much harder to do your own work on your car because too much of the system was electronic and needed special hardware to work with, plus it was really compact and you had no room to do things. We have already moved away from the home car mechanic. Why do you think we will go back?

      The last paragraph is where I agree with you. Regardless of which jobs stay around longer, the end game is the same. We have a growing fraction of the population that isn’t employable and a system that is set up around people working in order to be able to live. That is a recipe for disaster. I think that a basic minimum income is a nice stop-gap, but in the end I think we need a system that doesn’t involve money. We need to embrace abundance where it exists instead of forcing scarcity on things that don’t need to be scarce.

  9. Today, engineers earning $75,000-$100,000+ are training Chinese, Indian, and Polish engineers to replace them who will be paid $15,000-$25,000 to do the same work after a 6- to 12-month learning curve, resulting in an increase in productivity of 4-6 times over that of an American engineer. There is a 0% probability that American engineers will be able to compete against this kind of labor market competition and race to the bottom for wages/salaries. Studying science and math for 16+ years of one’s young life to obtain a STEM job in the future will meet with diminishing returns like we’ve never known in the West.

    Full-time private sector employment per capita in the US is back to the level of the late 1970s to early 1980s. Unless one has lost a job in the past 4-10 years, one is very unlikely to understand how incredibly difficult it is to find similar or better employment and compensation after losing a well-paying job in the US.

    In the 1980s-90s, engineers and technical managers who lost jobs in tech became daytraders and real estate flippers; no more. How many adappster hipster techie hotshots does the economy need that can’t be had by hiring Indians, Chinese, and Polish for a fraction of the cost? How long before the adappsters are without work and no place to go to retain their incomes and purchasing power?

    Now add intelligent systems, robotics, biometrics, nano-electronic sensors, and the cloud, and we risk loss of jobs, incomes, and purchasing power for the vast majority of the labor force, including those with post-secondary credentials and technical skills and experience.

    Moreover, the Internet is a powerful force for homogenization, standardization, and scale, creating conditions in which customization and differentiation become less valuable. GOOG is in the process of disrupting and cannibalizing MSFT, ORCL, IBM, SAP, HP, DELL, EBAY, AMZN, FB, etc., the way MSFT and AAPL did to IBM, but only this time in a net destructive manner in the context of increasing globalization and no replacement sectors creating anywhere near the number of jobs that are lost.

    1. BC, this is the same story that I heard after the dot com bubble burst. The media went on and on about all the tech jobs being outscored. It was a lie then and it still is. The reality is that the global demand for tech capabilities has grown so fast that there is growth everywhere. It is true that people are employed in tech overseas and some jobs are being sent over there. However, companies have learned that not everything works that way and talented people are in high demand here as well.

      I haven’t been put out of a job where I was forced to look for a replacement. However, every May I see a bunch of my students graduate. (For context, this is in Computer Science.) All the good ones will have jobs. Many will pick from multiple offers. They will all be well compensated and their salaries are going up, not down. Even an old man like me was asked to do some contract work on a project.

      We are moving toward a situation where all jobs are tech jobs. I like Marc Andreessen’s quote saying that in the future there will be two types of jobs, those where people tell computers what to do and those where people are told what to do by computers. Technology still requires human intervention to advance. The people who advance technology are trained in STEM. Eventually the technology will probably advance on its own, (and I don’t think that is too many decades off) but that will be a whole different era of human history.

  10. Interesting comments/reviews related to technology killing jobs on Eric Schmidt’s (& Jared Cohen of Google) new book, “The New Digital Age” that just came out & was featured on CBS Sunday Morning (04/28/13). One Amazon review mentioned Martin’s book.

  11. “I think that a basic minimum income is a nice stop-gap, but in the end I think we need a system that doesn’t involve money.”

    How would such a system work?

    1. That is a great question. First, it can’t work until most things that people want have moved to being abundant, especially in the sense of not involving much human labor. I think it also needs to include some approach to motivating people to do things that are seen as socially productive. Having people who sit around with nothing to do have very negative social implications. Money is a great motivator, but there are other things out there which also motivate people.

      I think that the idea of the attention economy makes sense. Humans have a natural desire for others to pay attention to them. This goes all the way back to social structures in other primates. So I can imagine something that acknowledges positive attention, but without a lot of the baggage of the current monetary system. Klout comes to mind as a current entity that starts to move in that direction.

    1. That is ideal. However, with college having a pricetag on the order of $100k, it is hard for most people to justify going there without some belief that they will make that money back. The ideal of learning for the sake of learning is great, but in practical terms, most families can’t afford to lay out the current cost of a college education just so their kid can learn some cool things.

  12. I think you’ll have to do better than klout.
    A guaranteed minimum income as Martin says, may be the way to go after some societal breakdown shows the current system is broken.

    1. I don’t think Klout is sufficient, but I think it gives the idea of a metric for an attention economy. I also agree that the guaranteed minimum income in a good interum approach. I just don’t think it works all that well once we get past a certain point. Will that really work if 90% of the population is unemployable and has no chance of having anything above that minimum income or does that situation still lead to social instability?

  13. With a GMI most will amuse themselves to death.
    Birth rates will collapse, entertainment will rule.
    With bread and circuses people will die from heart attacks not riots.

    1. I can’t rule that out. I think it is a far better world to live in where people enjoy themselves to death than to fight and kill one another. My students have talked about entertainment housing for the poor when we discuss things like this. I used to always bring up Farmville as a great example of how people can be placated for many hours doing something of absolutely no value.

  14. But as we both know, there is no GMI forthcoming.
    The elite will ride this train until they (not us!) can benefit no more.
    We live in interesting times.

    1. Hope springs eternal. 🙂 Seriously, the only 1%er in my circle of friends has fully embraced a GMI and he is serioursly fiscally conservative. He is libretarian. For him to support it though it needs to meet some specific requirements. He worries that current policies provide disincentives to work so he would only support a GMI which is really flat. He also sees the GMI as a way to get rid of all the other forms of social welfare and to really streamline entitlements. There won’t be any questions of qualification or amount other than, being old enough to receive it.

    1. Nice article. I can see that happening though I think it will end badly. I would also argue that the US has already done a less extreme version of this. We have developments that are like little cities that only welcome those with money. They aren’t as locked down as this, but that is mainly because they don’t need to be. The US has a lower crime rate and better social structure currently than these other countries. However, that doesn’t mean we don’t have an explosion in gated communities that are fairly unwelcoming to anyone who isn’t a resident and where the cost of being a resident is out of the reach of most individuals.

  15. It will end badly for those on the outside.

    If 30 million of the roughly 300 million people in the US are wealthy enough or connected enough to own/manage robotic production, then they can trade among themselves.
    The rest aren’t needed.

    Horse population fell after the introduction of cars. No need to breed them.
    Human population will fall as manufacturing and services fall to machines.
    High population density city life works against big families.
    Birth rates are decreasing worldwide.

    I want a better future for myself and my children but what I see is a long slow decline.
    Hunting led to agriculture; agriculture led to manufacturing; manufacturing led to services; services is leading to unemployment and underemployment.

    I see no sponge for the labor of millions. If you take out all people who can’t work (the elderly, the very young), and those who depend on taxes (government and gov’t workers), that leaves a very small working population supporting everyone else.

    Naturally they will join together, and work towards keeping more of their wealth. As this trend continues, the have-nots will be frozen out.

    1. Marion, it seems to me that Martin would argue that when you get down to only 10% of the population consuming, the lights dim for everyone. However, I do have to wonder if 30 million isn’t enough to sustain a viable system.

      It certainly won’t be better in general though. That is why I like the idea of a system without money and wealth. I don’t yet have a perfect proposal for it, but all the options that keep money and wealth seem to spiral into oblivion.

  16. No. (It’s Marlon, by the way).
    No. I am not saying only 10% will consume.
    It won’t happen overnight, bam a la kazam! Only the top 10% are consuming!

    Nope. It will be a slow squeeze in which the have-nots make do with less and less, the haves make do with more and more, and are protected from the have-nots by fortressed enclaves etc. while the have-nots take out their frustrations among each other.

    30 million is enough for a viable system. Ever more efficient machines and processes make this quite possible.

    From recorded history, we have used money. I see no substitute.
    The only way out is GMI (which would take divine intervention at this point!).

  17. There other strategies that could be employed if mass automation proceeds to significantly reduce employment.

    1. Reduce the work week gradually over time. For example, reduce the work week by 1/2 an hour every year for the next 20+ years. The wage remains the same each year and goes up with inflation and performance etc. When you get down to a 24hr work week, and before then, you can fit two work shifts in a week each 3 days long instead of 5 days.

    2. Rather than income distribution or perhaps along with it. Governments buy and distribute shares of all the companies and legislate the payment of dividends, where feasible.

    In this way the markets, which are working people in the end, are maintained and society thrives.

    1. I can’t comment on #2, but I have serious problems with #1. I’ve heard this argument before, but it completely ignores the lessons of “The Mythical Man Month”. Two people working 20 hours each is not the same as one person working 40 hours in the jobs that are going to continue to exist. Even worst, the skills demand is going to be very skewed. We are already seeing this. There are positions going unfilled because they can’t find people with the right skills while unemployment is high. The result is that the people with key skills don’t just have jobs, they are asked to work as much as they can because it itsn’t really possible to find other people to help them. Just today I walked to a company that wants to hire me to do some work for them because they simply can’t find enough people that are competent in the needed skill.

      So you are going to be looking at a position where companies need people with high level skills that take years of training/practice as well as a certain level of inate ability to achieve. They are going to find a dirth of those people and when they do find them, the overhead of having multiple people collaborate will be too high. Hence, the work weeks will have to stay long for those with the key skills and there won’t be a reduced reason to hire everyone else for doing anything at all.

  18. I believe Obamacare is resulting in #1 for the easily replaceable.

    But Mark is definitely right for those with special skills. They may have to work 60 hours a week while served by secretaries, janitors etc. on 29 hour shifts.

    The value of the special skills folks is being undercut by immigrant visas and offshoring.

  19. Great debate everyone.
    The sooner this debate involves wider humanity engaging with the implications (especially politicians, federal Treasuries and economists), the less painful the outcomes will likely be.

    Perhaps the future employment for more of us is in ‘ideas entrepreneurism’. When intelligent networks with robotic peripherals eventually heavily influence our lives (and essentially set the prices of many goods and services), our purchasing power will come from our actions as ideas entrepreneurs – our design contribution (great new designs) exchanged for the goods & services we want or need.

    It follows that being a great designer/inventor is aided by imagination, courage and advanced understanding – the later typically provided while earning a university post grad qualification and the research time beyond it. Collaborating with outside enthusiasts while studying at university or doing post graduate research at a university (open source/crowd-sourcing) will also help. Micro-entrepreneurship that involves developing niche demand, then growing it to a critical mass for the micro-entrepreneur to service, with or without intelligent networks & their robotic peripherals, may help too.

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