Harvard Business Review Blog: Manufacturing Jobs and the Rise of the Machines
Andrew McAfee explains that the resurgence in American manufacturing doesn't mean the creation of new jobs. There is global decline in manufacturing jobs, even as manufacturing grows, due to automation. He ends with this:
... Even if total manufacturing employment goes down because of automation, he [Ron Atkinson] writes, other industries will pick up the slack by employing more people. This is because:
"...most of the savings [from automation] would flow back to consumers in the form of lower prices. Consumers would then use the savings to buy things (e.g., go out to dinner, buy books, go on travel). This economic activity stimulates demand that other companies (e.g., restaurants, book stores, and hotels) respond to by hiring more workers."
Fair enough, but what if those other companies are also automating? One of the most striking phenomena of recent years is the encroachment of automation into tasks, skills and abilities that used to belong to people alone. As we document in Race Against the Machine, this includes driving cars, responding accurately to natural language questions, understanding and producing human speech, writing prose, reviewing documents and many others. Some combination of these will be valuable in every industry.
Previous waves of automation, like the mechanization of agriculture and the advent of electric power to factories, have not resulted in large-scale unemployment or impoverishment of the average worker. But the historical pattern isn't giving me a lot of comfort these days, simply because we've never before seen automation encroach so broadly and deeply, while also improving so quickly at the same time.
I don't know what all the consequences of the current wave of digital automation will be — no one does. But I'm not blithe about its consequences for the labor force, because that would be ignoring the data and missing the big picture.
I too wonder about this.
