technology, jobs and middle class

 

“It’s a terrible thing to be a worker exploited in the capitalist system. The only worse thing is to be a worker unable to find anyone to exploit you.”

economist Joan Robinson

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“Men have become the tools of their tools.”

John Stuart Mill

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So.

 

If you read the headlines about computers and technology and jobs and the economy … well … you are sure that the apocalypse is upon us.

 

In other words … computers, or technology, are costing us jobs <so what the hell are people supposed to do?>

 

Regardless.

 

The only real apocalypse I know of for sure is that my head is going to explode if I see one more headline like the one following:

 

 

Future economy: Many will lose jobs to computers

More and more jobs are likely to be automated – and hence, fewer people will be needed to do them.

 

 

What a bunch of bullhockey.

 

 

 

We could just as well written headlines like “because of computers many will have jobs.”

 

 

Anyway.

 

It is headlines like this that give me the opportunity to discuss technology, how it is creating jobs <just different than maybe some that currently exist> … and how it is shifting economic power.

 

There is a great <interesting> new study from the Center for Economic and policy Research on the widening gap between the haves and the have nots … and the role of technology:

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To preview our main findings, we believe that the tasks framework fails as an explanation of rising wage inequality.

Technological forces may be behind observed changes in the wage distribution, but, if so, current versions of the tasks framework do not adequately represent those forces.

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Interstingly … there really are 2 aspects to this discussion:

 

–          Is technology affecting middle class jobs

 

–          Is this affect on jobs impacting inequality <or, maybe better said, skewing income>

 

A writer <with some nice sources within the article> addressed both:

 

http://www.theguardian.com/commentisfree/2013/nov/25/technology-middle-class-jobs-policy

 

 

–          Don’t Blame the Robots: Assessing the Job Polarization Explanation of Growing Wage Inequality

 

November 2013, Lawrence Mishel, Heidi Shierholz, and John Schmitt

 

Many economists contend that technology is the primary driver of the increase in wage inequality since the late 1970s, as technology-induced job skill requirements have outpaced the growing education levels of the workforce. The influential “skill-biased technological change” (SBTC) explanation claims that technology raises demand for educated workers, thus allowing them to command higher wages—which in turn increases wage inequality. A more recent SBTC explanation focuses on computerization’s role in increasing employment in both higher-wage and lower-wage occupations, resulting in “job polarization.” This paper contends that current SBTC models—such as the education-focused “canonical model” and the more recent “tasks framework” or “job polarization” approach mentioned above—do not adequately account for key wage patterns (namely, rising wage inequality) over the last three decades.

 

 

Basically … the study suggests that Technology didn’t kill middle class jobs.

 

The study also suggests that some policies have actually eliminated middle class type jobs.

 

 

Let me address the first “uh oh.”

 

Uh oh … technology isn’t replacing people’s jobs?

 

 

Well.

 

Yes and no.

 

It actually shifted jobs.

 

The popular myth is that technology and innovation rapidly reduced the need for factory workers and other skilled labor.

The data just doesn’t support it.

 

 

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Between stimulus and response there is a space. In that space is our power to choose our response. In our response lies our growth and our freedom.

Viktor E. Frankl

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Simplistically … people need to make this shit.

 

Has anyone noticed that everyone now walks around with technology? … or that everyone has additional pieces of gadgetry strewn around their homes? … or that technology is actually pervasive throughout the work place?

 

Technology is often an enabler … an enhancer within lives – business and in the home.

 

And someone needs to make this shit.

 

That is … well … called ‘labor.’ As in people working at specific jobs to think of, make an sell all this stuff. It hasn’t killed jobs … simply created a huge new labor market.

 

 

Now.

The second ‘uh oh.’

 

As in ‘uh oh … if technology isn’t killing jobs … where the hell have all the jobs gone?’

 

And with the jobs that have gone … hasn’t that influenced the current state of income inequality? <or a wider gap between the haves and the have nots>.

 

First.

 

Yes. There is a gap.

 

People can slice & dice the information any way they would like but unemployment is too high, the higher incomes have higher wealth than before … and many people have shifted into lower income & wealth levels <not suggesting poverty but rather ‘less than’>.

 

The middle isn’t going away … it is just moving away from the center and shifting towards the edges.

 

And the research suggests that much of this is a result of policy.

 

Who cares you may be asking?

 

Well.

This is an important distinction.

 

 

Because this states that it was not something that just happened … it was something that we did or was done to us.

 

 

That presents a very different policy agenda for addressing inequality.

 

Why?

 

Well.

 

 

It kind of squashes <or changes the priority> of technology & skills.

 

Look.

No one argues that children should get a better education. But if a lack of skills was not the cause of inequality or the job market than … simplistically … more skills will not be the solution.

 

Uhm.

 

Ok.

I’m not suggesting we shouldn’t insure kids don’t learn the right skills … I am suggesting that a skewed inequality is a business issue.

 

 

Ah.

 

But here is the really hard part to the solution.

 

 

To address this business issue and take on the inequality challenge … significant ‘haves’ and aspiring ‘haves’ may have to not only lose some of their gains from the last three decades but also lose some of the ‘high end wealth’ opportunities.

 

 

I say that because if that is true then we are likely to keep hearing stories about technology destroying middle wage jobs for some time <even if the evidence doesn’t back up the stories>.

 

Look.

 

We buy and use more electronic gadgets today therefore manufacturing supporting them continue to grow.

 

This means that while production technology has replaced people, its growing and expanding markets has offset the initial losses by magnitudes.

 

In addition … technology is actually <most typically> used to increase worker productivity rather than make workers redundant.

 

The main consequence is that workers are able to do more despite less investment from the owners of capital.

In a more societal driven system, the increased wealth that comes from greater productivity would be shared with the workers.

 

But that isn’t the system currently in place therefore the owners of capital have the opportunity to hoard the wealth and inflate assets <and ultimately convert it into political influence to insure protecting the wealth>.

 

Anyway.

 

Technology isn’t the enemy.

Technology is a tool.

It’s those who wield the tools who need the discipline not those who build them.

 

Nothing has increased human standards of living more than science and technology.

Even political movements tend to be grossly overrated by comparison.

 

I say all this to suggest that any jobs crisis we perceive isn’t in technology.

 

 

It’s in developing better systems to deal with the technology.

 

 

We need to be careful that we don’t attack technology <us non technology people> with the intent to feel good about ourselves and to convince yourself that you’re actually a lot more important than the technology guys.

 

Technology now permits more productivity and more progress than ever.

 

Technology progresses and people … and society … need to progress with it.

 

 

The idea that we should or even can remain stuck in a world with a certain type of jobs … and doing things the way we have always done … is … well … ridiculous.

 

There is no reason to accept or expect stagnation.

 

The world is living through one of the greatest technological revolutions in history <digitization of communications, manufacturing, computing, synthetic biology, nanotechnology, etc.>.

 

The core economic challenge is to enable the advances for life & world betterment. By the way … this includes not only economic growth but also greater social inclusion and environmental issues.

 

Technology is not the issue and shouldn’t be blamed.

 

It would be silly to do so.

 

We humans can solve this issue if we stop blaming others.

We came up with technology.

We certainly have the intelligence to build a successful world … for everyone … with it:

 

 

“There are no great limits to growth because there are no limits of

human intelligence, imagination, and wonder.”

Ronald Reagan