With all the concern about artificial intelligence (AI) destroying a large number of jobs in the coming years, it might be worth it to see what history tells us. It’s possible that things are different this time and we may all soon be reading news articles and watching entertainment created through AI and dealing with automated call centers and accountants. On the other hand, maybe not.
More often, new technologies have augmented what people are already doing. They help them focus on other more complex tasks. Despite the introduction of automated bank tellers (ATMs) in 1969, human bank tellers are still around. While ATMs have mastered dispensing cash and taking deposits, today’s tellers tend to focus on more complex transactions. And, I am happy to report that they are still willing to take my deposits at the teller window with a smile. Even a second wave of technology in the form of online deposits and other transactions has yet to finish off the job of bank teller.
As ATMs grew in popularity, one New York City bank (I cannot remember which one) limited teller transactions to those involving a high dollar amount. (Again, I cannot remember the amount.) A local competitor rolled out an ad campaign with the theme, “Our tellers love people.” The first bank rescinded its policy very soon after.
In the 1960s concerns that automation would permanently reduce the number of jobs available became so acute that President Lyndon Johnson formed the Blue-Ribbon National Commission on Technology, Automation and Economic Progress. One of the commission’s tasks was to suggest how the country could address a permanent reduction in the overall number of jobs due to automation. That permanent reduction never appeared.
New technologies not only eliminate jobs or change their nature, they also create new jobs. And that’s what has happened with each new scare that whole categories of jobs and some professions would become obsolete with the introduction of new technologies.
One widely cited 2013 study calculated that 47 percent of all U.S. workers are at high risk of losing their jobs to automation within 10 to 20 years. It’s now 10 years later, and we are still waiting for that big wave of permanent job losses.
One way to determine whether the pace of automation is upsetting the job market is to look at what is called “churn,” that is, the rate of creation of new occupations and destruction of old occupations. A 2017 study looked at churn and found this:
The levels of churn in the last 20 years—a period of the dot-com crash, the financial crisis of 2007 to 2008, the subsequent Great Recession, and the emergence of new technologies that are purported to be more powerfully disruptive than anything in the past—have been just 38 percent of the levels from 1950 to 2000, and 42 percent of the levels from 1850 to 2000.
In other words, the rate of churn from 1995 to 2015 was a fraction of previous long-term churn rates.
Another measure, productivity growth, provides a telltale sign that the automation-as-job-killer thesis is in a bit of trouble. Productivity growth is the increase in productivity per hour of labor. If automation is accelerating, the rate of productivity growth should be rising as well. Automation should be giving each worker access to more and more machine power, driving growth in his or her productivity at a higher rate compared to other times.
But that’s not what’s happening. Productivity growth in the United States, for example, has been rather anemic from 2007 to 2021 compared to the period of the post-World-War-II boom from 1947 through 1973 and lower than both the 1990s and the period from 2000 leading up to the Great Recession. America is the home of tech, but productivity statistics seem to say that that tech is not shrinking the workforce by giving each participant more productivity through automation.
There are certainly job categories that are disappearing. I watched the age of the typesetter disappear right before my eyes in the early 1990s as graphic artists gained control of the typography they needed through computer-aided design. Today, every computer comes with graphics tools and scores of typefaces for the average user.
But the loss of a single category of jobs or even several categories has not meant a permanent reduction in available employment. As longtime readers know, I am far more concerned that the consequences of resource shortages and climate change will undermine the world economy (and thus employment) than I am about the current and any future “automation scare.”
Photo: Toyota robot at the Toyota Kaikan in Toyota City. Photo by Chris 73 March 9 2005. Via Wikimedia Commons https://commons.wikimedia.org/wiki/File:Toyota_Robot_at_Toyota_Kaikan.jpg