Technology Is Taking Jobs Away, But Here’s How It Might Give Them Back

http://www.xconomy.com/national/2011/05/27/yes-technology-is-taking-jobs-away-but-heres-how-it-might-give-them-back/

by cwan • 15 years ago

11 26 15 years ago

chailatte5• 15 years ago

You know what else takes jobs away? Free. Free apps. Free website. Free TV shows. Free movies. Free music. Free video games. The customers start to be conditioned to the word 'free', and slowly refuses to pay for anything in those categories. The cumulative market shrinks as result, leading to more companies shutting down and more layoffs.

Oh, but there's advertising, one say. And there's the unlimited amount of venture capital funding these 'free' companies. Well, if we keep losing jobs in valuable sectors because we keep giving things away for free, how will people pay for products that will sustain advertising budgets in those companies? Will we just keep selling advertising to each other? And at a certain point in the economy, consumer is more conscious about price than brand (like now), in which case advertising will start to falter.

So the next time you give away products for free, you should think about whether or not it'll cause you to lose your company/job in the future.

flipbrad• 15 years ago

at the same time, you're describing an economy generating a whole lot of wellbeing and welfare. Unemployment and redundancy are dirty words, but if part of a stable economy generating what we need, perhaps we should reconceptualise redundancy as a good thing? Individuals have always wanted robots doing our chores so they have more time with our families. Can't society think the same way?

chailatte5• 15 years ago

Perhaps in a perfect world, we won't need jobs or money. But in our current state/world, we (everyone in the world) still need jobs and money for limited resources to survive like energy, clean water, food, stable infrastructure, materials and people's time. And everybody is competing for those right now, hence worldwide inflation and companies/governments reducing jobs to stay afloat.

rubiety8• 15 years ago

Yet another absolutely classic example of both the "lump of labor fallacy" and "make work bias".

When are we going to starting teaching more Economics and less Literature in high school?

chailatte5• 15 years ago

That's true. We should also teach how to present a valid, explanatory counterargument instead of thoughtless one liner.

rubiety8• 15 years ago

All the more ironic that the next item in my feed reader is, "The Problem Began When the Invention of the Spear Reduced the Price of Food":

http://cafehayek.com/2011/05/the-problem-began-when-the-inve...

How fitting to this discussion.

rubiety8• 15 years ago

His definition for "ephemeralization" is "doing more with less", which is strange since my academic background in economics teaches me the word for this is nothing more than "efficiency".

So many of his claims supporting his "net destroyer of jobs argument" contain no real analysis are amount to fallacies exposed by the history of economic progress. At almost any point in history you could make an almost identical argument about something else where efficiency improvements reduce the number of jobs in one particular industry. People used to also worry that more women getting into the work force would reduce the jobs "available for men". Classic "lump of labor fallacy": http://en.wikipedia.org/wiki/Lump_of_labour_fallacy

Even all this aside, and sweeping away any historical parallels (one of which he mentions - Ford) where the ultimate conclusion flatly contradicts his pessimism, there's a healthy dose of "make work bias" implicit in the entire article. It's still puzzling to me why people focus so much on work as being something desirable to per-sue in it's own right. Work is the price we have to pay for consumption: http://en.wikipedia.org/wiki/The_Myth_of_the_Rational_Voter:...

This statement alone completely blows away his credibility to speak on economics: "And for all its vaunted technological prowess, the United States hasn’t outpaced the rest of the world in GDP growth". It's well understood in growth economics that we wouldn't expect advanced economics such as the United States to outpace growth of 3rd world countries playing "catch up". He could do the same analysis against modern, industrialized countries instead and come to a very different conclusion. Even if this statement was accurate, it's a complete non-sequitur in support of his overall claim.

It's funny that the second part of his article back-tracks from his original claims and contains far more sense than the first part. "Ephemeralization [READ: efficiency] itself might eventually give rise to new types of jobs." That's exactly right, and has been true for centuries without fail.

Finally, it's embarrassing that he chooses to quote Tyler Cowen, a respectable economist who would would surely call out this article more forcefully than I.

orenmazor• 15 years ago

technology doesn't take jobs away. humans can repurpose, roombas can't.

FlowerPower2• 15 years ago

Technology must take jobs away.

Invent something, do something, so you never have to do it again, or any one else. Enjoy life. Meet people, talk about ideas and new inventions, if you like programming all day, do it. If you like singing and dancing all day do it. If you like making movies, giving healthcare to people do it. Unconstrained by employment.

EliRivers• 15 years ago

Agreed; the (possibly impossible) goal of any sensible government should be full unemployment.

FlowerPower2• 15 years ago

Its good technology is taking away jobs, if it is not, that means we are all doing something really really wrong.

Who in their right minds would like to do things just to do more things? People always come up with new things so they can stop doing what they are doing. Lazy programmers are the best, the ones that dont want to do things when a computer can do it for them.

People should stop working. We have enough technology to feed everyone on the planet, and maintain and develop our current rate of progress, even without aiming for full employment. We have to strive for lesser work days. Why is 8 hours acceptable? We are designed to work only 2 hours per day, maximum. That is why we invent.

sedachv• 15 years ago

Not only do we need to reduce working hours, we need to provide a basic income guarantee (http://en.wikipedia.org/wiki/Basic_income_guarantee). This is what the promise of technological progress is about, and is one of the tenets of Marxian communism. Ironically, the basic income guarantee is also something that is advocated by many liberal and libertarian economists.

These two factors are IMO key to further accelerating the rate of technological innovation. They enable anyone who is interested in science and technology to freely pursue these interests, whereas today many people are driven away from science by huge disincentives (massive student loans and poor career prospects).

hugh3• 15 years ago

The problem as I see it (and I've probably said this before) is that not all jobs are equal... or rather that not all people are equal. Increasing technology doesn't take away jobs, it increases the amount of wealth you can create with the same amount of labour, at least up to a certain point. But it also makes the jobs that do exist harder (intellectually speaking), because as the jobs switch from "assembly line worker" to "guy who supervises the robots that work on the assembly line" the brainpower needed to do the job increases.

Roughly half the population has two-digit IQs, half the population has three-digit IQs. Two thousand years ago, 90% of all jobs were in the fields and could easily be done with a two-digit IQ. A hundred years ago, jobs had started to shift to the cities, but probably still 75% of 'em could be done with a two-digit IQ. Nowadays I'm worried that we're reaching the point where 60% of the jobs which actually and economically exist require a three-digit IQ to be done properly, and that this will only continue to increase as the easy jobs get automated away. What, then, do we do with the world's stupid people?

Detrus• 15 years ago

Mine them for data after making them share as much about their life as possible.

More seriously, those three-digit IQ jobs will turn to two-digit IQ jobs as technology makes them easier. There's a predictable cycle for technological progress, until a certain point at least.

kiba• 15 years ago

People are also more intelligent simply because their environment becomes more complex.

Remember, the average level of IQ back then would be considered retarded today.

hackinthebochs• 15 years ago

>it increases the amount of wealth you can create with the same amount of labour,

The end result of this is that there are fewer jobs. There is a certain amount of "production" (for lack of a better word) needed to maintain the same quality of life. As production becomes more efficient, it takes less and less labor for the same output. This inevitably reduces the amount of jobs available.

Knowledge work can't fill the gap, partially because most people just aren't capable, and partially because it takes an order of magnitude fewer knowledge workers than manual laborers for a given amount of output.

>What, then, do we do with the world's stupid people?

The answer is that we're going to have to change our attitudes towards "redistribution of wealth" for society not to fall apart.

rubiety8• 15 years ago

I think what you're trying to say is that technological progress brings highly increasing returns to intelligence such that one person has the capability to produce an extremely high amount of value relative to their peers (increase in income inequality, perhaps).

And I agree, this is most likely the case. But inequality as a side-effect is something that can be dealt with via relatively inefficient policies that do not distort too heavily the division of labor as it exists.

In other words, we should let this grand increase in efficiency happen, but correct perhaps for inequality resulting therefrom in a relatively efficient way as we need too.

Far too many people use the inequality argument to prove too much (that we should attempt to slow specialization of flat-ouf efficiency at its source), and this argument is deeply flawed IMO. In other words, don't shoot the messenger. Intelligent people are creating enormous amounts of value, but their income/price is just a messenger of this information.

sentinel• 15 years ago

The same "ephemeralization" has also created thousands of jobs for people that produce those devices and people that build applications for them.

Technology Is Taking Jobs Away, But Here’s How It Might Give Them Back

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