Monday 7 October 2019

Will automation steal all our jobs?

Yet another report predicts we are all going to be replaced by machines. Well, maybe not us, but our jobs at least. The report, issued for Wells Fargo clients, predicts that over the next ten years technology will replace ten per cent of banking jobs. The report's author, banking analyst Mike May, claims the job cuts will be the "greatest transfer from labour to capital" of all time.

Mr. May's report notwithstanding, the replacement of human workers by machines seems to be very slow in happening. The unemployment rate in Canada (and in the U.S.) is the lowest in 50 years. It seems humans are still very much in demand.

Part of the reason may be many peoples' preference for human interaction. From my own observations, people aren't exactly flocking to the machines. Apropos of Mr. May's report on banking, for example, when I visit my credit union I find most customers prefer living, breathing tellers to the ATMs. Similarly, at my local supermarket the cashiers do much more business that the automated checkouts. My local library has had an automated checkout for years, but almost everyone disdains it for a real librarian. And why would you not? Librarians are among the most pleasant and helpful people on the planet. No point in saying good morning to a machine.

Furthermore, machines don't always replace as many workers as they are intended to, as my library automatic checkout illustrates. The replacement predictions are often made by IT people, i.e. engineers, and engineers tend to be more comfortable with things than human beings. To an engineer, any sensible person would choose a fast, efficient machine over a slow, mistake-ridden human being. But most of us aren't engineers and, like the members of any social species, prefer the company of our own kind. So, at least if we are given a choice,  we are often inclined to contrarily choose the person over the machine. At least if we are given a choice; unfortunately often we are not.

And then there's the problem people often have managing the machines. At my supermarket, for example, each machine needs a human being looking over its shoulder.
Customers frequently have trouble using the things and require the assistance of a staff member, so each machine has its accompanying human assistant.

Nonetheless, many jobs are being lost to automation. This has been the case since the dawn of the Industrial Revolution. Indeed it's been responsible for the increasing efficiency of production and the resulting increase in living standards for everyone. It is happening faster today but, as in the past, new jobs appear to replace those that disappear.

And here is where the real problem arises—the kind of jobs that replace those lost. The political disaster of Donald Trump's election in the U.S., as well as Brexit and other assorted disasters, is in large part due to manufacturing jobs being lost to automation and replaced by service sector jobs, i.e. middle class jobs replaced by precariat jobs and all the accompanying angst.

I suggest we should be less concerned about job losses, the inevitable result of advancing technology, and focus our attention on ensuring that when people lose a good job we can quickly transition them into another good job. That means at least three things: excellent opportunities for education and training, ease of forming unions, and legislation to protect the precariat. When it comes to the jobs issue, politicians should be judged by what they can offer on those three fronts.

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