Many American adults remember from our childhood the cartoon series “The Jetsons” which imagines a future where machines do all the work, and people just get to play and relax. But as Silicon Valley futurist Martin Ford points out in his new book “Rise of the Robots”, even in such a high-tech future, people will still have to eat and therefore buy food. How will they do that if there are no jobs left for people to do?
This book is about how the technology revolution has eliminated, and continues to eliminate American jobs, and how that process is constantly accelerating. Automation, fast computers, robotics, and especially big data and artificial intelligence are all interacting to rapidly reduce or eliminate whole categories of American jobs.
We can all think of blue collar jobs which have been automated and reduced in numbers if not totally eliminated. But the author tells us that the rapid advance of technology is not only threatening but eliminating all kinds of high-skill jobs, too. How many analysts does Wall Street need to employ if algorithms and fast computers can now make investment decisions by analyzing big data?
We sometimes think of the technology revolution and offshoring, the transfer of jobs to countries with lower labor costs, as separate problems contributing to the loss of American jobs. But Martin Ford points out that offshoring is actually a product of the technology revolution. He describes offshoring as “virtual immigration”, except that unlike actual immigration which affects mainly low-skill American jobs, offshoring also provides low-cost replacements for high-skill American jobs requiring human judgement and experience.
A whole industry has developed in India dedicated to the electronic capture of high-skill U.S. and European jobs, which can be done cheaper in India. And the author notes that the language barrier in China can and will be overcome with the development of simultaneous electronic translation, so that China can join the competition for the capture of high-skill American jobs. The few remaining elite jobs to be done by people instead of robots will have to be shared with India and China.
Martin Ford describes as a myth the notion that all we have to do to avoid a jobless future is direct our youth towards science, technology, engineering and math. In fact, he says, we are already producing so many “STEM” graduates that they each year exceed the number of available jobs by 50%. The same phenomenon is evident in Europe.
Forcing American workers to compete with robots, computers, and low-wage competitors in other countries, is what the author blames for persistently stagnant U.S. wages, rising inequality, increasing personal indebtedness, and a shrinking American middle class. Compare Ford’s explanation to that of Thomas Piketty in his book Capital in the Twenty-First Century, which attributes the same phenomena to the economic principle that return on capital exceeds the rate of economic growth.
If Ford is correct about the future of high-tech innovation, we need to think about how to maintain consumption levels to prevent an economic implosion. He is receptive to the idea of a guaranteed minimum income for Americans even if their labor is no longer needed. He also likes the idea of a sovereign wealth fund, so all Americans can share in the rising profits from lower labor costs that are now accruing mainly to a narrow slice of our economic and technologic elites. And he thinks we have to restrict immigration.