Dystopia or Utopia? - Part 1: The Setup

Many smart people who think about that kind of thing are saying that a significant percentage of jobs will be under the threat of automation in the near future. See here and here and here. The timelines given are in the range of only a couple decades. Now, many people say that this isn't a big deal. Jobs have been automated for eons. The wheel put stuff carriers out of business. The lever put stuff picker uppers out of business. The powered loop put weavers out of business. The airplane put birds out of business... wait, no. Anyway, new jobs will come up and we'll be fine... Right?

Well, no. Here is why. There are three parts of this. First skilled versus unskilled labor. In the past, most of the jobs that were being automated were unskilled labor. The cotton gin for example. It didn't require a lot of training to deseed cotton. So it put a lot of people out of work. However, there was a TON of unskilled work to be done back in 1794 so the workers weren't too hard pressed to find something else to do. Today however, unskilled work that gets automated puts the displaced workers in a bind. There isn't a lot of unskilled or low skill work out there. And almost none that does exist pays well. We are seeing this happening already.

The second part is that in the past when the cotton gin took all those jobs there was a lot of peripheral work that came along with it. Salesmen, mechanics to fix them, and manufacturers to build them. These were higher paying jobs too. So while it did shift the economic picture around some it was largely a positive shift. Our country became more prosperous and well to do than it was previously. Today however, the automation is compounding upon itself. When we build a robot that can weld a car frame together better than any human worker the number of jobs associated with the creation of that robot is not anywhere close to how many aren't needed anymore. The robot is made by another robot and they are all connected to the internet so a single technician can monitor hundreds and fix most problems without leaving his desk.

Another point onto this is that because of software there is a lot of automation that is invisible. Take QuickBooks for example. How many accountants has that software not necessarily put out of work, but made unnecessary to begin with? And with software there is no manufacturing at all. That leads me to my final part.

The final part is skilled workers aren't safe. Like the missing accountants from QuickBooks there are a lot of white collar and skilled jobs that are under serious threat to automation as well. When you stack all that together you end up with, to reference the article from before, an expected 45% of jobs being lost in the next 20 years. The vast majority of which are not going to be replaced. There isn't a huge wave of computer programming computer programmers that are about to be needed (I realize that isn't clear, I mean people who program computers to program computers).

Here are a few additional anecdotal arguments for why I think this is true and already happening.

1. Fewer people are working already. The US labor participation rate is 62.4% which is the lowest since the mid 70's, and it is showing no sign of going up. Automation is making it harder to find a job as well as making it so a lot of people don't need to.
2. In the past new inventions freed people up to do new productive things. At a certain point you run out of productive things to do. The internet has allowed music, gaming, art, and entertainment to explode like no other time in human history. This is great, but it means that a huge number of people are making a living doing something that is a luxury (economically speaking).
3. Many of the big engineering efforts in recent years involve how small you can make a phone, or how to create a more immersive virtual reality (VR) experience (this might come up in Part 2).

So where does this all go? Well, you will have to tune in next time...