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Will automation increase unemployment or underemployment in the United States and...

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cdeeneedham | (Level 1) Valedictorian

Posted November 7, 2012 at 3:07 PM via web

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Will automation increase unemployment or underemployment in the United States and around the world?

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wordprof | College Teacher | (Level 3) Senior Educator

Posted November 7, 2012 at 4:58 PM (Answer #1)

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Only short-term thinking could argue that automation would decrease employment.  To be sure, unskilled labor, repetitive labor, purely mechanical jobs will decrease, and thankfully so.  History is full of such occasions (with the accompanying fear of unemployment):  the Luddites, who thought that the automatic weaving machines would be detrimental to hand-weavers; the cotton gin, which threatened the slave-owners; the assembly-line of Henry Ford, which threatened the horse-and-carriage trade (symbolized by the buggy-whip metaphor).  Today, improvements in farming equipment “threaten” the stoop-labor practices of those who rely on illegal immigrants for cheap labor.  On the other side of the argument, look at the number of jobs in the farm-tractor industry, the fabric manufacturing industry, the automotive industry (where many complained that welding robots and similar automations would take jobs away), etc.  As an industry, electronics and automation are making many more (and better) jobs than they are replacing.  A wise man once said, “If you are replaced by a little black box, get a job making little black boxes.”  This is basically what automation has done.  Yes, schooling and/or training need to be added to the mix; that is why education, as an industry, is also growing.  In the long term, automation is a job-maker for the economy.

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pohnpei397 | College Teacher | (Level 3) Distinguished Educator

Posted November 16, 2012 at 4:57 PM (Answer #2)

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The first answer here is correct in many ways.  Economists do certainly argue that, in the long term, automation is good for an economy.  However, this does not mean that automation is good right away.  It also is not unquestionably good in the way this first answer seems to imply.

First of all, it is clearly true that automation can and does lead to unemployment and underemployment in the short term.  As the first answer notes, many autoworkers (for example) have been replaced by machinery in recent times.  This can lead to them becoming unemployed or to them becoming underemployed if they are forced to take jobs that do not fully utilize their skills.  This phenomenon of underemployment is quite common as relatively skilled jobs are lost and workers are left to take lower-paying jobs, typically in service industries. 

Economic theory expects that these people who are replaced by machines will simply find better jobs.  As the first answer says, for example, they should get jobs making the machines that replaced them.  However, it is no nearly this simple.  First of all, the jobs that are still available tend to be much fewer in number than those that were lost (it takes fewer people to make the “black boxes” than the black boxes replaced).  Second, these jobs often need skills that the laid-off workers lack.  It is easy to say that a laid-off assembly line worker should learn to be a computer programmer, but this is much harder to do in real life.  It is very hard for a person in their 40s or 50s to gain the skills needed for a new career.  Even if they do, they are likely to suffer from decreased wages as they work their way up in the new industry.

Therefore, economic theory does say that automation will not lead to unemployment or underemployment.  But that is in the long term only and it ignores the very real short-term impacts (and 5 or 10 years is short term for economists but very long for a struggling family) on people’s lives and their careers.

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