Bank of England's Andy Haldane Warns Smart Machines Could Take 15M UK Jobs (robotenomics.com) 291
New submitter Colin Robotenomics writes In an important new paper based on a speech at the trade union congress in London, Andy Haldane Chief Economist at the Bank of England and Executive Director of Monetary Analysis and Statistics has examined the history of technological unemployment and has given a thorough review of the literature and implications for public policy. The media will likely focus on the number of jobs that can be displaced and not necessarily Haldane's points on new jobs being created – both of which are highly important as is 'skilling-up'. His report reads in part: "...Taking the probabilities of automation, and multiplying them by the numbers employed, gives a broad brush estimate of the number of jobs potentially automatable. For the UK, that would suggest up to 15 million jobs could be at risk of automation. In the US, the corresponding figure would be 80 million jobs."
15M (Score:4, Informative)
They've been saying this since the 1970s, with all sorts of forecasts of 15 hour weeks. Yet there are many millions now in work compared to the 1970s and everyone's working longer hours than ever.
Re:15M (Score:5, Informative)
They've been saying this since the 1970s, with all sorts of forecasts of 15 hour weeks. Yet there are many millions now in work compared to the 1970s and everyone's working longer hours than ever.
In the 1970s they assumed that everyone would work less. What happened is that some work more than ever and others don't work at all.
Re:15M (Score:5, Informative)
The whole essay is well worth reading, and remains just as true as ever it was..
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I guess being a world renown logician don't mean you can reason. For how long are the now half idled pinmakers to be kept on the company payroll? Is the total number of pinmakers static over time neglecting that economies shift over time? Suppose a new company is formed to make pins and starts producing pins with half the workforce, so their pins are cheaper and the first company goes out of business.
This reminds me of the philosophers and Deep Thought when Deep Thought tells them they could have the lifest
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And Russell never thought about the overhead of employing people (for example, training costs). It is not sensible to employ two people to do the work of one person.
Finally, what happens to the unemployed half? They find new work that exists merely because there were people available to do it.
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Finally, what happens to the unemployed half? They find new work that exists merely because there were people available to do it.
If you're suddenly made redundant, a new job does not magically pop up elsewhere to accomodate you. The vast majority of people can not create jobs for themselves.
Re:Communism = stagnation (Score:4, Insightful)
In Bertrand Russell's example, no one of the needle workers actually strives to improve his skills. But instead, the companies replace the old needle manufacturing equipment with new ones which doubles the productivity of their workers, and all of the workers get retrained for the new process. So yes, the inventor of the Improved Needle And Pin Machine gets his share, as he has outfitted all needle manufactures with his new invention. But the global market for needles does not increase, as needles are totally cheap already. A lower price for needles does not increase demand. So what we have now is companies with 100 percent surplus manufacturing capacities competing in a tight market, and half of them will get bankrupt in the process (it may be purely random which one get hit), until the manufacturing capacity for needles fits the demand again. It means half of the workforce will be out of a job, even if they don't differ in any way from the part of the workforce, that is still employed.
So contrary to your hypothesis, it's not the individual strive or laziness that made the difference between unemployed and employed needle workers. It's pure random chance. They all trained for the new manufacturing process, they are all equally skilled. But they were just to many, if they kept their working schedule.
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So, what happens if 1/2 the pin factories shut their doors, but the other 1/2 of the pin factories hire their workers part time and double their hourly wages?
The remaining factories still make the same profit, the workers still make the same salary, the world still gets the same pins at the same price, but 1/2 the factory owners are left scratching their heads for what to do that will pay as well as the pin business used to.
In the current system, 1/2 the factory owners AND workers are out on the street, and
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Average corporate profits are around 7% a year, same as stock market returns and other risky investments. That's roughly where they should be; it's a fair compensation for the risks investors take and the value they contribute. And through the stock market, everybody can get that return.
Profits don't go up long term when companies become more effici
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Your entire analysis is nonsense. You can't predict the effect of a decrease in the cost of making a product without knowing the demands for labor in other manufacturing plants, the difficulty of retraining, the elasticity of demand for needles, etc. Often, automation and mass production have increased the amount of employment related to making a particular product.
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The inventor is irrelevant in any major industrial venture. If a business sector is turning $1B/year of product (not profits), an invention that improves efficiency 1% is worth $10M/year. Investing $20M to implement the invention is a no-brainer, unless your stockholders demand instant gratification ROI quarterly. In any event, $10M payment to the inventor is in the noise, market variations will impact profits 10x that amount every year.
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And no doubt you are a billionaire. Because you aren't lazy, are you?
Thanks for your anonymous comment, Mr. Ellison!
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This is because you can't just hand off knowledge from one person to another in zero time. If you're assembling widgets according to a set of instructions, then you can work 3 hours day, then the next person can take over basically instantly where you left off. Or you can work 2 days a week and you don't lose any productivity by having other people working the other days of the week.
If you're doing something that requires more high level thinking, like computer programming, designing a skyscraper, or tryin
Re:15M (Score:5, Informative)
They've been saying this since the Industrial Revolution. Millions of jobs WERE lost, but many millions more were created.
Yes, but it's still a race to the bottom, because of the jobs which were created, more of them were unskilled — read "not paying a living wage" there to see the problem. We're seeing the same thing here in the USA right now; although the total number of jobs grew this last year, the number of people seeking employment has not changed at all. That's both because job growth is only just keeping up with population growth, and because the majority of the new jobs don't pay a living wage. The best we're able to do at the moment is fight a holding action, only we're doing nothing to improve the situation in the future, so that's the same as losing the war.
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The new jobs aren't paying a living wage because they're not required to, whether by law or market.
Without employment laws, minimum wage in the US would resemble minimum wage in the far East.
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This "war" can never be won because people who reason like you keep shifting the goalposts. What you're asking for is not that people are better off year after year (which they are), but that magically everybody ends up with an above average income and standard of living, and that is mathematically impossible.
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It's infinite greed. The capitalists are pocketing all the profits from technological innovations. The workers get the same cost-of-living wages + bonus based on skill scarcity/education.
A simple example: Amazon uses cheap, massive warehouses instead of small, expensive bookstores in downtown. Amazon replaces tens of thousands of salespeople with a website that costs millions of times less. Yet your BN brick-n-mortar bookstore sells a book at the same price as amazon.com. Don't you think Amazon is making a
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Yet your BN brick-n-mortar bookstore sells a book at the same price as amazon.com.
Not to take away from the rest of your post, but have you been to a Barnes and Noble in the last few years? They do not sell books at the same price as Amazon. They do not even sell books at the same price as their own website! If you go to bn.com, you will find that they match amazon.com or get close. But if you go into a store, you will find a much higher price.
I actually go to Barnes and Noble a lot (magazines, cafe, kids section with my toddler) and check on this sort of thing once in a while since I ra
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They've been saying this since the origin of the Luddites in the early 1800's!
Technology is a force multiplier. It allows one person to perform the work of many. Historically, instead of increasing unemployment, it's done the opposite - creating larger numbers of jobs, especially in positions that can't exist without a large-scale economy technology provides. The ability to make a shirt via a machine, thousands of times faster than by hand necessitates buildings for the machines, a distributed sales forc
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The average human just isn't wired to be altruistic
Speak for yourself.
This is a good thing. (Score:5, Insightful)
Re:This is a good thing. (Score:5, Insightful)
I doubt basic income will ever be instituted, except via close range threat of shotgun blast. (and then only a maybe.)
What most ideologues of the basic income seem unable (or unwilling) to grasp, is that service and goods providers do not service or provide from the goodness of their hearts. They do it for profit. In order for a basic income to work, then a very large tax must be levied against these agencies, as they are going to be the ones with all the capital. (It makes precisely zero sense to bill the general public, since a good portion will be getting said basic income-- That would just be absurd. At best, the money just moves around, and in the real world, money will be lost from the system over time. To make this workable, the bill has to come from outside the pool being subsidized. That just leaves banks (who create money at will using the fractional reserve system) and for profit businesses who engage in for profit enterprise; especially those that conduct business internationally.) This means that the tax system has to be seriously overhauled for anything like this to work, and the people who would need to be on board to make it happen would be openly opposed to it (because they would be voting against their own profiteering.)
The only way I see this ever gaining traction, is when there is simply no alternative-- The economy is so unhealthy from the loss of liquidity in the general public's financial engine, that there is simply no hope for future business growth without it. That wont happen unless the entire planet suffers such a financial crisis, since as-is, large actors can leverage different local economies and give a big fat "fuck you" to others, and thus continue being profitable. (See for instance, the H1B fiasco, or just outsourcing IT to India in general.)
If you think the word "Wellfare" is tainted now in conservative political circles, just wait until something like THAT comes to bear. I would expect tax dodging to take on epic new extremes, even greater than the infamous "Double Irish" trick, as these actors all scramble to avoid being the ones having to finance the growth of all other actors. (Since the one that finances the least, gains all the benefits of the revitalized economy, without as much of the cost, and thus is most poised for market dominance. As such, NONE of them will be willing benefactors.)
Given the degree that big business already controls world government (Shit, just look at how fucked up the MPAA and RIAA make things, just by themselves.), I think a functional basic income is about as realistic a prospect as expecting Jesus/God to suddenly appear tomorrow.
It would definitely be nice; the problem is, when you are dealing with greedy fuckholes, you cant have nice things.
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Milton Friedman advocated for a form of basic income, the negative income tax.
I think such a systems sounds interesting. One argument in favor of it is that it would replace the complex bureaucracies collectively called "welfare" and the inefficiencies surrounding them (complex means tests, restrictive, inefficient markets in which benefits can be used, such as "low income" housing, food stamps, etc).
Most seem to posit a progressive tax on income that doesn't negate all earned income below the basic income
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levying steep taxes on the wealth of the dead actually makes a lot of sense. It's the least intrusive and disruptive to the working economy at large, far less than income or sales taxes.
I think this gets tricky. I would bet that a significant chunk of inheritable wealth is tied up in working investments now, whether they're small business assets, family farms or blue chip securities. Taxing them essentially liquidates those investments, negating the capital productivity (although arguably it could be thought of as just shifting the capital to public good investments instead of private investments).
But even more fundamentally, I think the result is a purer form of capitalism, because in a capitalistic economy wealth should flow along vectors of productivity, not lineage.
I agree with this, but mostly because there's a non-financial goal achieved -- limiting the
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And what said greedy fuckholes don't understand is that they are outnumbered and out gunned. Once they force enough people into a shadow society (we have them now, they're called "gangs"), they will be invaded from the inside.
The people advocating for the Basic Income or other potential solutions are just trying to head off what could be a very ugly period in our future history.
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With the caustic political situation in the US especially, it will never happen, unless something(as you point out) catastrophic happens to the financial system.
Even then though I still doubt it.
I really think where we are going as a civilization is a sort of "culling the herd" as it were. Those that control the vast majority of wealth see the writing on the wall regarding human population, the environment, climate change and t
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That's what a lot of people don't understand. 15 million people not having to do tedious mindnumbing work that can be replaced by a machine is a GOOD thing. The fact that this is seen as bad news is proof of our disfunctional society and economical model. The day basic income comes in together with a reform of our economy, is the day automation will truely be embraced as it should.
Here's the problem though; to pay for basic income, everyon e has to earn less. Are you willing to settle with getting nothing but a 4th of your salary? Are you willing to forfeit all profits you could ever make in a business so that you could feed someone else? That's exactly what it would take to maintain basic income, to redistribute wealth evenly. I like the idea of everyone earning a set amount and then working for more, but then the system breaks down, because nobody wants to contribute back. The tru
Re:This is a good thing. (Score:5, Insightful)
to pay for basic income, everyone has to earn less
I don't think that's accurate. Productivity since the 70s has doubled [pinimg.com], but real-terms wages have been stagnant. In the last 3 decades, the top 0.1% of Americans have doubled their wealth. It's obvious that improved technology can maintain the same lifestyle for the same number of people but with the labour of fewer people - the maintenance of employment levels has mostly been due to the improvement of that basic lifestyle (smartphones, better medical technology, etc) providing jobs for displaced farm workers etc. The system we have encourages spending the extra productivity of technology and economic growth on an expanded lifestyle, but it could be diverted instead to providing a basic lifestyle without requiring extra labour.
I like the idea of everyone earning a set amount and then working for more, but then the system breaks down, because nobody wants to contribute back.
In the trials of Basic Income that have been done so far, the total amount of work drops about 4%, mostly accounted for by teenage students studying instead of working to support their family, and mothers looking after their kids. The local economy grows.
The truth is that the majority of people want to keep their own success
Is it entirely their own?
"forget all that rhetoric about how America is great because of people like you and me and Steve Jobs. You know the truth even if you won’t admit it: If any of us had been born in Somalia or the Congo, all we’d be is some guy standing barefoot next to a dirt road selling fruit"
- Nick Hanauer [politico.com] (self-described billionaire plutocrat)
The wealth that a few accumulate is based on the labour, and custom, of the many. It depends on a working society. If your society collapses because people can't afford to eat, then you're just a guy with a nice house fending off the starving hordes with a shotgun. And your delivery of fresh organic produce isn't coming this week.
Basic Income isn't about redistributing wealth evenly ; it's about making sure that no-one starves, and yes, it's also about making sure that the businesses of today have customers tomorrow. The Citigroup Plutonomy Report aside, not everyone can make a living making gold-plated iPhones and giant yachts.
Re:This is a good thing. (Score:4, Insightful)
If the US had the same income distribution it had in 1979, each family in the bottom 80% of the income distribution would have $11,000 more per year in income on average, or $916 per month. Half of the U.S. population lives in poverty or is low-income, according to U.S. Census data.
Sadly the 0.1% have taken all the wealth generated by economic growth since 1970 and fooled the rest of the population into believing that this is what they deserve. Remember all that relentless Fox News propaganda is paid for by those who think that this is justified.
If 80 million US jobs are destroyed by automation then they will all starve according to the current socioeconomic model of the U.S. You may want to remember that the next time you engage in a political debate.
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If 80 million US jobs are destroyed by automation then they will all starve
Now you're catching on.
There is an advantage in how this will play out towards the 1%. This erosion of employment and the gradual thinning of the middle class is really to their benefit. If it happened all at once then there would be more of an outcry.
As long as there are even a few crumbs falling off the table, the millions will fight over them while those sitting at the table get fatter by the day.
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If your society collapses because people can't afford to eat, then you're just a guy with a nice house fending off the starving hordes with a shotgun. And your delivery of fresh organic produce isn't coming this week.
Well now that depends. Fresh organic produce can be delivered by drone. Can the starving hordes take out a drone? Not at altitude, and especially not if there have been a few more decades of encroaching gun/weapon control. As for the lonely homeowner with a shotgun, keep in mind guns can and will be automated (e.g. https://www.youtube.com/watch?... [youtube.com])
That said, I think that dystopian vision is pretty unlikely. The reality is that people are social creatures and therefore other people have innate value to us.
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The implication of this juxtaposition is that somehow real-term wages have stagnated because the money has gone to top income earners. That is patently false. To the degree that real-term wages have grown slower than they should, it's because of massive redistribution and regulation within the bottom 80% of income earners. Take
Re:This is a good thing. (Score:4, Insightful)
> Here's the problem though; to pay for basic income, everyone has to earn less.
Actually, no.
Up to now the increase profits from automation have gone to the Super Rich. There has been massive transfer of wealth from the poor and middle class.
To fund "basic income", taxation has to be made fairer so that more profits stay with the people.
Probably won't happen in America though. Not till after the mass riots.
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15 million people are free to do the more interesting, or entirely new, jobs that don't get done currently! This is no different from any change through history. For example, because we don't need an army of agricultural workers harvesting the crops, people can earn a living doing things undreamed of 150 years ago.
Undoubtedly, as with all change, there will be a period while things readjust. It's just up to us to ensure the adjustment is for the better. If we go into this fixed on the negatives, with n
Re:This is a good thing. (Score:4, Insightful)
The thing is-- Machines are getting to be better at *ALL* human endeavors, including theoretical future ones.
Already, machines are getting to be quite good at "creative" tasks, for instance.
This opinion bases itself on the (faulty) notion that there will always be a valid career path in the future for humans to grab on too. Eventually, in the face of perfect automation, there will simply be no task where employing humans is either efficient or profitable.
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Sheesh, its the god dam luddites all over again.
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It isn't always necessarily tedious and mind-numbing work that can be easily automated.
I can think of two obvious examples of high-skill jobs that are being automated as we speak. One is document discovery in the law profession, formerly done by lawyers and paralegals and now much more often done by software. Another is interpretation of X-rays and other medical images done by doctors.
On the other side, it will be a very long time before we have a robot who can clean an occupied hotel room.
The challenge is
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It isn't always necessarily tedious and mind-numbing work that can be easily automated.
I can think of two obvious examples of high-skill jobs that are being automated as we speak. One is document discovery in the law profession, formerly done by lawyers and paralegals and now much more often done by software. Another is interpretation of X-rays and other medical images done by doctors.
Everything I've heard from lawyers and paralegals about document discovery is that it is tedious and mind-numbing: the mistake you are making here is thinking that 'tedious and mind-numbing' and 'high-skill jobs' are somehow mutually exclusive. It also doesn't necessarily mean that those who are having parts of their tasks taken over by machines will not welcome it as it provides more complete results than a human is capable of doing on their own and frees up time for other activities even if it does cut i
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Agreed. We must stop snatching defeat from the jaws of victory. If our economic model doesn't server our entire society, it must be changed. If instead we void the social contract and toss "surplus" workers out of our society, they have no choice but to form their own and take over (by force if necessary). The latter seems like a bad choice.
Re:This is a good thing. (Score:5, Interesting)
It takes more than just free time to obtain (and retain!) a profitable job skill, especially when the eligible pool is being continually eroded.
It takes money, and aggressive ambition.
Ultimately, only the most ruthless of the wealthy will be able to afford the training and education to claim a profitable job skill, under this kind of pressure.
Your suggestion is not workable. The option for people to simply consume HAS to remain on the table, simply because it will ultimately become the ONLY choice, especially as automation further encroaches, and completely eclipses all human labor roles. The alternative is a non-economy, where nobody has money.
To circumvent this problem, you need to pick one of the following 3 solutions.
1) forbid automation preemptively, citing that it erodes human employ-ability, and thus total human economic activity. (Enjoy your 19th century standard of living!)
2) Embrace automation fully, and give up profit-motive as the driving goal of human endeavor. (Yay, startrek)
3) Accept that automation will ultimately result in a market that cannot stand on its own, and introduce a basic income, supported through currency inflation from the government coupled with taxation of agencies and individuals exceeding the basic income per anum. (OMG, the commies won!)
Those are literally the only three viable solutions.
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3 is just an implementation of 2, maybe flawed.
In any case, it's easy to understand that there _will_ come a time where money stops being the center of our lives, and we produce enough stuff for everyone without having everyone work 40+ hours a week.
The question is _when_, and _how_ that change happens. Marx thought it would happen soon. The commies thought it was possible a century ago. Looks like they were wrong in that, also in their methods. They also thought they knew what people wanted, looks like th
Re:This is a good thing. (Score:4, Insightful)
"Go and get skills" is decent advice to give to an individual, but it doesn't work society-wide.
Where are we going to get 80 million new skilled jobs for all those newly skilled unemployed people?
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Well, we still have to figure out a good way to get rid of coal fired power plants, that task alone is probably going to take a good chunk of those 80M people. If you had 80M people building windmills and solar-thermal plants you could get rid of coal worldwide in less than a generation, maybe even produce enough excess power to have everyone use a BEV. That would be a significant good to everyone on the planet and the primary reason we don't do it today is cost, but cost is just a way of measuring labor so
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Perhaps there will be a small bump in the initial build up of this infrastructure, but eventually, like everything else, the system to upgrade, monitor and maintain it(which will replace coal fired power plants) will all be automated.
Automated as in a lessening of the number of new jobs as the technology gets more advanced.
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Same place we got SEO optimization consultants, genetic counselors, and UX designers from: entirely new industries and technologies.
Some of the jobs we might have in a decade are VR fashion designers, 3D food printing designers, online education coordinators, commercial drone delivery operators, nanotech cleanup, virtual prostitute. Use your imagination.
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Go and get themselves a useful skill
If there is a serious amount of unemployment, that just means that you end up with PhDs serving burgers, and the average person has no chance of a job at all.
And, no, they can't all be entrepreneurs and drag themselves up by their bootstraps to become billionaires.
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Piss off with that rhetoric. There simply aren't enough jobs for graduates as it is now. Intelligent people with firsts in physics, maths and engineering are apply for the same shitty jobs as those that struggled to get 3 low grade GCSEs. The population is exploding, the older people are not retiring, so where are all these fucking jobs then Mr Dail Mail reader? Fucking twat.
Don't bother. He's either living in a bubble and has no idea how the real world works (he'll get mugged by a few of those unemployed 15 million), or just ill-willed.
15M jobs is 50% (Score:2)
The UK workforce is 30M[1]
You're trying to tell us that half of all jobs in the UK can be replaced by "smart machines"?
Somehow I don't believe that number.
[1] http://www.dailymail.co.uk/new... [dailymail.co.uk]
Re:15M jobs is 50% (Score:4, Interesting)
You're trying to tell us that half of all jobs in the UK can be replaced by "smart machines"?
Just think about how many jobs you could automate away with a very simple shell script. Now think about how many jobs could be automated away with a very simple shell script and some basic robotics. The mind boggles. Also, a lot of jobs are just lost because the need for them goes away. For example, if we shift from internal combustion to electric motors, it's a fact that you won't need as many people to work on them because they are so much simpler to produce and so many of the steps can be completely automated, like motor winding — and they don't break down as much to begin with. It's simply a fact that you need less people to produce and maintain them. That's progress eliminating jobs, and not replacing them with anything.
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Thanks â" that's Econ 101 stuff.
That's a nice way to wave your hands dismissively, but I notice you're not offering any useful response.
Definitely correct on one point (Score:4, Interesting)
Still waiting for burger flipping robots (Score:2)
$15/hr movement isn't moving fast enough for my robots to take over and make my order right 100% of the time, every time.
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You won't have too long to wait.
Momentum Machines [zerohedge.com] burger maker.
Want a patty custom ground out of 1/3 pork, 2/3 bison? No problems. The price of a burger is already set by the market. This thing eliminates the labour, the savings can be spent on high-end ingredients, gourmet burgers for McD's prices.
The graph in this article is also a great illustration of why all the "oh, but tech makes new job opportunities" guys are wrong this time around ; the food-service industry already absorbed more than the unemploy
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Nah, I won't ask anything. I'll just wait for it to happen.
Yawn (Score:2)
For economists and planners, the world of tomorrow is always the world of today, plus a little bit of what's already going on today. Forecasts of doom because of the 'machines take over' have been around since a long, long time.
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Lightbulb to eliminate whale hunting jobs (Score:2)
In other news, the invention of the modern light bulb will put thousands of whale hunters, butchers and ship owners out of work, endangering their retirements and family healthcare plans.
640k jobs (Score:2)
Re:In other news (Score:5, Insightful)
15M UK people could do something else. The world fails to end.
If this bank doesn't help them find some work, there's going to be hell to raise, especially when 15 million people is about a quarter of the entire UK's population [wikipedia.org]. If a fourth of the US was layed off, do you think that would end peacefully?
Automation makes sense when the job is dangerous or risky to humans, or requires extreme precision. Replacing everything with automated machines for profit gains makes it hard for low end jobs to exist, and thus for low end workers to be employed. We have here a very large mass of people who feel hopeless and have nothing to lose. We also have a very large resentment towards the upper class and a weak middle class. History has presented us this situation before, and I encourage you to research what happened then.
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The Bank of England is I guess the equivilent of the federal reserve in the US. It's more of an arms-length somewhat independent institution that keeps an eye on the economy and sets interest rates etc. They are not big employers, this is just an observation.
Jason
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Almost everyone used to work on the farm. Now almost no one does. Amazingly, we don't have a 98% unemployment rate. With the automation of agriculture, everyone moved to manufacturing jobs. Food fell from almost all the family budget to about half the family budget, and people could buy manufactured goods, so there were lots of jobs.
With the automation of manufacturing (which, if you weren't paying attention, is almost finished at this point), everyone moved to service jobs and paper-shuffling jobs. Fo
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If this bank doesn't help them find some work, there's going to be hell to raise, especially when 15 million people is about a quarter of the entire UK's population [wikipedia.org]. If a fourth of the US was layed off, do you think that would end peacefully?
Yes, and this is where I get so annoyed at idealistic neo-liberals. They harp on about how they should be free to do whatever they want while ignoring the massive benefit of social stability that things like paying taxes and having a centralised government gives them. I would love to live in some enlightened society where we can do away with the apparatus of central government and things like taxes, but that is not going to happen if it involves humans.
The real danger we have from the 1% is that they become
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OK. They've surrendered.
Now what? You can't send them back to work. The whole point is that there's no work for them to do. Not even ditch digging or pyramid building. These days we have heavy equipment that does that.
So you incarcerate them in camps? They're hungry. They're bored. They're upset. You're either going to have to provide ways to feed, shelter, and amuse them or they're just going to rise up again and again until you either remedy the situation or commit genocide.
But when you are the government
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As they say in the Market:
"Past performance is no guarantee of future results."
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Re:In other news (Score:5, Insightful)
The example I keep seeing used is self-driving vehicles, particularly trucks.
They've already proved themselves in mining contexts - they use less fuel, wear their tyres less, less maintenance, downtime, and of course, no wages to be paid.
People are falling over themselves to get them approved for road use. Truck driver is 3.5M jobs in the USA. There are about 285,000 HGV drivers in the UK.
The trend is already that middle class jobs are being eroded and replaced with low waged work. Truck driver is unglamorous but they probably count as middle class guys with the wages they get.
What jobs are we going to find for truck drivers? They're not all going to train up to be robot-truck mechanics (as above, robot trucks are pretty much existing trucks with a few extra sensors and something wired to the power steering etc - and require less maintenance). You'll have all those middle-class people with a lower disposable income, so the market for services and consumer goods will shrink, so what industry will expand or arise to employ them?
Tech changes that increase production, expand wealth and (eventually) the job market. Spinning Jenny and her ilk turned cotton shirts from a luxury into a mass-market commodity.
Tech changes that just do existing work with less human labour do not expand wealth. The automated trucks drivers, administrative assistants, warehouse pickers, burger flippers, etc, etc, that are coming down the pipe do not increase demand - if anything, they decrease it, by reducing the amount of wages entering the economy.
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That's the elephant in the room. Economists (especially those who occupy armchairs or political office) have miossed that the industrialization that improved everyone's life in a free(-ish) market did so because there was a severe labor shortage and even then, it only worked out after a great deal of civil unrest including a number of fatal confrontations.
The current industrial revolution is taking place during a labor surplus. Freeing humans from the need to labor is a laudible and achievable goal but the
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Or Manna: http://marshallbrain.com/manna... [marshallbrain.com]
Likely somewhere inbetween.
Re:In other news (Score:5, Insightful)
What we'll need to do is move to a guaranteed basic income. If robots do most of the industrial labor, then we tax that productivity instead of human wages. Give money to people who will spend it on food/clothing/etc, thus maintaining a demand for the goods the robots make (since in a market, you need both supply and demand, otherwise things start going bad quickly on a macro level). Eliminate the minimum wage, since everyone earns enough to live on, and let market forces freely set the value of human labor. $2 an hour is pocket change, but that's really all I'd need it for at that point. You wouldn't need welfare or such, since the minimum income covers it - and it's fair, because everyone gets it. If you make more money, you just add it on top of that - so instead of making $100k, you might earn $80k salary, but get your $20k basic too.
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This, exactly.
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Back in the mid 18th century there were plenty of alternative employment opportunities for displaced agricultural & industrial workers.
Now they did mostly involve going to other countries and shooting people (and occasionally being shot by them) and being flogged and catching horrible diseases. But you can't have everything, can you?
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People have made the same Luddite arguments that you're making for a couple of centuries. Even the notion that you can talk about labor as something that there is a "shortage" or a "surplus" of is idiotic. There are far more things that people want to get done than there are people to do them; always. When people don't have to do tedious and repetitive tasks that get automated, they can do more useful and productive things.
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That's the elephant in the room. Economists (especially those who occupy armchairs or political office) have miossed that the industrialization that improved everyone's life in a free(-ish) market did so because there was a severe labor shortage and even then, it only worked out after a great deal of civil unrest including a number of fatal confrontations.
My belief is that there will be such a labor shortage again. The real elephant in this room is the fact that we are still seeing increasing demand for labor along with that increasing automation and increasing wages. This is the same trend that has been going on for centuries. It's just happening on a global scale rather than a developed world scale of the past.
The current industrial revolution is taking place during a labor surplus. Freeing humans from the need to labor is a laudible and achievable goal but the labor market and it's imaginary magical invisible hand isn't up to the task.
It's sad that people are so eager to discount the power of markets even when there's strong evidence the markets are working as advertised.
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The wages to be paid are in the manufacture (not to mention design) and maintenance of the automatic drivers. If you have a fleet of 100 trucks, sure, you might eliminate "unskilled" drivers jobs, but the maintenance of the machines will actually increase o.k. - driver error induced maintenance will fall, but, basic wear and tear will be the same, and the automatic driver itself will be an important maintenance item.
Somebody has to keep the lenses clean, or at least fill up the tanks for the automatic len
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Vehicle manufacture is already highly automated. We've had window-cleaning robots and similar ways to avoid paying expensive humans to do rote work for a long time. Roombas can seek their charging stations without human guidance and so, I'm sure can Teslas.
The ancient and honorable trade of diagnosis and repair mostly went away years ago. These days, it's cheaper to swap out major assemblies and scrap the old ones than it is to track down a broken capacitor. Even back circa 1985 I had bought a pocket calcul
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Yes, it's absurd that we have people expected to work 70-100 hours a week while laying off thousands, but that's because the current regulatory climate means that it's cheaper to keep one person working longer than 2 or 3 working less hours. Each new employee comes with a fixed overhead cost in addition to ongoing salary. That's probably one of the first things that should be addressed, but before that can happen you'll have to convince a lot of powerful people that they have to adjust the way they do things.
Because a lot of powerful people like paying lots of overhead per employee? Sure.
Which, since unions are so despised, means government is the only obvious alternative way to apply pressure to the less altruistic, and in turn, that means ending the current anti-regulatory mindset. The one that brought us the Great Recession and other wonderful things.
You claimed that regulation is the primary cause of the problem of overwork not the usual lack of altruism among employers. So why again are you advocating even more regulation and even more introduction of problems? This creates a perpetual cycle of failure where new poorly thought out regulation is created to patch over the failures in the previous generation of poorly thought out regulation.
It's also worth noting here tha
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The example I keep seeing used is self-driving vehicles, particularly trucks.
And the example that keeps getting ignored is farming. If out of work farmers and their descendants couldn't get new work, then we'd be around 80-90% unemployment.
Tech changes that just do existing work with less human labour do not expand wealth. The automated trucks drivers, administrative assistants, warehouse pickers, burger flippers, etc, etc, that are coming down the pipe do not increase demand - if anything, they decrease it, by reducing the amount of wages entering the economy.
Nonsense. The ex-truck drivers just do something else. Now, you have the wealth generated by the automated truck drivers and by the labor of the ex truck drivers. This is not only an expansion of wealth, it is an expansion of the rate of increase of wealth.
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The example I keep seeing used is self-driving vehicles, particularly trucks.
And the example that keeps getting ignored is farming. If out of work farmers and their descendants couldn't get new work, then we'd be around 80-90% unemployment.
I don't know. I don't think the job market for oxen and horses has ever really recovered.
The crux of your argument seems to be that automation has not lead to mass unemployment in the past, so why would it in the future? Why worry about it now?
I'd argue that while it hasn't lead to mass unemployment yet, it's more recently lead to under-employment and a decline in wealth for everyone except for an increasingly small number of people.
Former farmhands took jobs that required little in the way of ski
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I don't know. I don't think the job market for oxen and horses has ever really recovered.
They're still employed though. And you ignore that humans are a bit more flexible than oxen and horses.
The crux of your argument seems to be that automation has not lead to mass unemployment in the past, so why would it in the future? Why worry about it now?
I'd argue that while it hasn't lead to mass unemployment yet, it's more recently lead to under-employment and a decline in wealth for everyone except for an increasingly small number of people.
You could argue that, but that's not happening. Sure, there are a small wealthy portion of the world which does well no matter what. But most of the world's population has been getting wealthier [voxeu.org] and this trend has continued to the present.
Life's too short to trust in falsehoods.
Now to get a decent job, most people have got to spend a small fortune on a college education. Most skilled workers start their careers in serious debt. And of course as soon as they start working, they need to start saving for retirement because almost nobody has pensions anymore. Then somewhere down the line they will find that their skills are no longer relevant so they get spend a small fortune on college again, - while trying to save for the kids' college education and their retirement. That's even if a 50 year recent college grad can find work.
It's not my fault some college students made very poor life choices.
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Tech changes that just do existing work with less human labour do not expand wealth.
Of course they do. If you can automate something and reduce costs, then you can sell your product more cheaply. Cheaper products mean your money is worth more; therefore wealth has been created.
If you lay off all your workers then they will not be able afford your products at any price - not matter how cheap. Therefore you cannot gain wealth and neither can they and nothing has been created.
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They aren't crippled or permanently unemployed, you stupid motherfucker.
Most people are not capable of generating their own jobs.
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implying work will be worth anything anymore lolololol
I'm tired of laughing at you now, so I'm going to hire a prole for five cents an hour to laugh for me, because I'm currently using my usual one as an ottoman.
Or maybe I'll use a robot. Costs four.
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Surplus workers. What do you suppose generally happens when there is a surplus on the supply side?
Typically, production drops and prices fall. Bad news for the supply side. Of course, it's not terribly ethical to destroy inventory or ship it off to a secondary market when that supply is human beings in need of a job. At the same time, the production process is fairly long (18 to 22 years). That's a lot of people making less than it costs to support oneself.
So no, throwing up our hands and claiming "the mark
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Thank you for putting it so succinctly. Too many think that The Market is a benevolent God.
The Market is more like a rain or sun god. A little rain is refreshing. A lot of rain can break a drought. Too much rain in too short a period and you get destructive floods. Over the total surface of the Earth, the Rain God is doing all of the above all the time. Some places get too little, some, too much and some just right. And where those places are shift over time.
Blind faith isn't enough. Sometimes you have to g
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So no, throwing up our hands and claiming "the market will take care of it" doesn't suffice when the "product" is human beings. The market (and the economy it lives in) is a construct of man that should serve our needs, not the other way around. If the economy does not serve our needs, it must be changed.
Except markets are more than adequate at employing people as long as you don't grossly obstruct them. Let us recall here that all these complaints about how the markets aren't working come from parts of the world where regulators force huge costs and liabilities on employers. The market is not so all-powerful that it can thwart your attempts to break it.
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Unless the change happens overnight, society will adapt to take advantage of the huge surplus workforce for jobs that machines can't do.
The largest mistake right now is assuming change cannot happen "overnight".
It can. It likely will. And we as a society are not prepared. At all.
Re:In other news (Score:5, Interesting)
And by "adapt", you mean "either learn to live with much higher poverty levels or come to terms with a much larger welfare state."
Because there really aren't any other choices. The world has reached peak jobs.
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If you don't have any money, "cheaper" doesn't help.
As someone has already pointed out, the first industrial revolutions occurred during a labor shortage. Now that there is a labor surplus the end result will be more people with no jobs and no money.
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Why would people "not have any money"?
What evidence is there for a "labor surplus"? By historical standards, the US unemployment rate is fairly low. Furthermore, it would be even lower if government regulations didn't make some people unemployable.
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Unless the change happens overnight, society will adapt to take advantage of the huge surplus workforce for jobs that machines can't do.
That's kind of the point. Since the beginning of the 20th Century, innovation and change have been happening at an increasingly rapid pace.
If we get to the point where disruption happens faster than people can adapt, then everything gets thrown into a cocked hat. Something fundamental will have to change or chaos will result. The kind that brings down empires.
Some think we've already passed that point, based on the fact that real earnings power in the USA has been declining since the 1980s.
In any event, I w
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Some think we've already passed that point, based on the fact that real earnings power in the USA has been declining since the 1980s.
That's because some people ignore labor competition from the developing world. Supply of labor increased, price of labor dropped. It's basic economics.
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The long term unemployment rate is 10%, short 5%, underemployed over 20%, wages down 20%. Bleak picture. The only beneficial shift that I can see is free continuous education (MOOC, etc).
If you look at corporate structure, many companies exceed 50% of their operating budget in Marketing (whether they show it on their 10k or not). That's where the jobs went. If you want value in a product then buy from the few companies that focus on operations (Costco, etc).
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Last time around when automation "eliminated" a lot of jobs, people became game designers, software developers, UX engineers, software testers, data miners, social media managers, sustainability experts, E-commerce consultants, genetic counselors, SEO specialists, drone pilots, and wind turbine maintenance crew. Both they and everybody else benefited.
We don't know yet what these 15M people will do when their current jobs get automated, but one way or another, it's going
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We don't know yet what these 15M people will do when their current jobs get automated, but one way or another, it's going to translate into 15M new and better jobs.
Yes, there will be almost exactly the same number of jobs created as are lost, almost all of them in as yet unknown areas. Let me guess, it's the Invisible Hand sorting everything out?
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If 50% of the workforce becomes unemployed, wouldn't it be nice if we could all work 7 hours a day, 3 days a week?
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Your lazy ignorance is astounding, and not in the least surprising. "They took our jeerrrrbs!". Idiot.