Recently computer scientists have looked at various jobs and tried to analyse how much they rely on logical processing and how much on ‘value judgment’ – the aspect that computers find hard. The idea is not so much that computers should replace humans, but supplement them.
Impact of computers on jobs…
Since the 1980s, the growth in computerisation has driven new divisions in the labour market and the distribution of incomes. In the US income inequality has increased – particularly over the past 20 years. Blue-collar manufacturing workers have been especially affected and this trend will continue. The contentious list of ‘at risk’ trades for the next wave of automation includes farming, transportation, food preparation, retail and construction.
The number of jobs that require little further education has remained the same: catering, security guards etc. However, jobs that require value judgments – management, teachers and other professions – have become more productive due to the support of computing. Where the value judgment is the larger part of the job, this has led to higher pay, but where the computerisation allows more candidates to qualify for the job, pay has tended not to rise. However, job numbers in these areas have all risen as the improved product attracts greater demand. Trades where automation may create more jobs than it replaces include healthcare, financial and legal services.
Political responses…
As in the past, automation is creating friction. Perhaps for political convenience, attention is being deflected towards China, with accusations of unfair trading. It is hard to separate the two issues as offshore manufacturing savings increasingly come from automation in those locations, rather than low wages. Tariffs are unlikely to offset them. With US unemployment currently low and wage inflation rising, we may see this issue as a more modest vote winner in the 2020 elections than it was for Trump in 2016.
In the 1920s, John Maynard Keynes predicted that productivity would rise eightfold over the next century and that the working week would therefore shrink to 15 hours. In fact, productivity has risen ninefold, but the working week has not shrunk. Instead of opting for greater leisure as incomes have risen, we have found new things to buy.
The jobs that the new wave of automation challenges may well extend further into white-collar than earlier waves. Politicians threatening to ‘tax robots’ may have misunderstood the situation: computing power is hard to tax and in manufacturing, there is little point in slowing the use of robots unless the Chinese and others promise to do so too.