Seem like the real issue lies in the trend toward optimization in every part of the economy, from the small business owner to large corporations etc.
Case in point, I worked for a startup in 2008 that had a FT sysadmin and actual rack servers/real hardware etc. Same guys started a new company in 2012, minus a sysadmin and hardware. The ease/price of EC2 just makes too much sense. I saw that happening.
One has to be careful to watch the trends and not be on the wrong side of history (like a sysadmin who is not open to cloud and devops at this point). But how are most non-tech savvy employees going to keep up with the times? Most likely they will be outmoded and seen as expendable.
This seems like an inevitable outcome of everything that "we" (the startup and tech communities) are doing. Nearly every startup business I've seen on HN is about an optimization of an existing industry. Almost invariably, optimization means cutting people out of the loop, as people are quite slow at a lot of the tasks computers are suited for.
The problem is of course the growing disparity between pay. As the existing middle is eliminated, the majority of people are trending towards the lower segment of pay (the 29/2/~70 ratio mentioned). Ideally we'd find a way to elevate a large portion of those in the lower 70% area to higher paying jobs. I think the reality is, many of those people probably will never be suited for jobs in the $100k+ range. The only solution I can see being viable is further socialization (in the US) of things like medical care, transportation, etc. in order to ensure that just because you don't have a high salary, doesn't mean you can't have a high quality of life. Either that or accept that the US is devolving into a 3rd world country.
All repetitive labor will eventually be automated. It is only a matter of time.
The problem with capitalism and tech is that the efficiency gains realized through automation nearly all go to the owners of the firms. The human laborers replaced by programs and robots are just S.O.L. Capitalism only works for a society as long as capital owners need human labor to carry out production.
"The only solution I can see being viable is further socialization (in the US) of things like medical care, transportation, etc. in order to ensure that just because you don't have a high salary, doesn't mean you can't have a high quality of life. Either that or accept that the US is devolving into a 3rd world country."
Yes. Either we implement basic income and universal healthcare, and improve access to public services, or we will end up with a tiny, but very wealthy "owner" class, and a very large, unemployed, impoverished majority.
Better to do it soon, while it's still a choice, rather than later, when it isn't. History has shown that the masses will only put up with so much inequality before they openly revolt.
An opposing force to this, though, is that increased automation will continue to reduce costs and barriers to entry, allowing people with almost no resources to start some form of income-generating online "lifestyle business." A lot of people are doing this now, but not nearly enough people are capable of it, for it to be a sustainable career option for almost the entire American middle class. Yet.
I don't think socialism or a high salary is necessary to have a higher quality of life over the long term. As technology increases abundance, material goods will become cheaper. This has been happening for thousands of years. The mean and median standard of living has been steadily increasing for a long time. I see no reason why it should be any different now. I think the real problem is only what to do over the short term with people that have trouble being useful in today's economy. Some socialism to solve that problem, I think, would be a good idea.
You know what I find funny? Those who argue against income redistribution - aka socialism - are probably going to be some of the first people to become permanently unemployed.
If you understand what's about to happen - you'll quickly realise that everyone will be out of a job and unless we keep people consuming - things start to get scary - like revolution scary.
Yeah, I don't have a solution to the situation, but when you look at the topline profits (going up), and employment (going down) at almost every corporation.. the rhetoric about "job creators" is a bit much.
In 1890, 43% of the US population were farmers. Because of technology (fossil fuels, internal combustion engines), most of those jobs are gone for good. We're going through a massive change and some people's livelihoods will go away permanently. They're not entitled to make a living at an obsolete job, but I think we owe it to them to provide a comprehensive safety net so they can survive and retrain.
This has been a trend over all of human history. Going to keep it brief and technically incorrect to paint a picture...
Initially, everyone was required to either hunt or gather food (probably). After a bit, humanity settled down into farming, and fewer people were required to keep everybody fed. This allowed for more time for childbirth. Better understanding of agriculture led to the creation of larger towns with specialized jobs such as blacksmiths and stables which led to farm animals helping to improve yields even further. To create the tools, some people had to go into mining jobs.
The pattern here is that advancement allows fewer people in each economic area to provide the same benefits, freeing up labor for new economic areas.
So clearly, the modern move to automate jobs isn't necessarily anything new. People are now free to move into creating accounting software instead of manually filling out journals. The problem occurs when the people freed up from advances do not have any new work to move into.
The result may simply be de-urbanization - people moving back into the countryside to grow their own food. Most people can afford to buy a small plot of land in the middle of nowhere (small piece of land in the middle of Africa is practically free). Or the result may be socialism. Or the result may be new economic sectors being revealed by innovation. Fortune telling won't get us very far.
As the original article alludes to the big difference now is that the rate of advance is increasing. When whole industries are being upended within a few years and this turnover is getting faster all the time, it is difficult to point to "retraining" (the historical fix for this) as a solution. Most people just aren't that intellectually flexible. Those that are will prosper, the vast majority will, I think, be screwed.
I'd love to see some sign that the US Government is starting to take this issue seriously and planning for it. While we're still years away from this becoming a critical social problem, I do believe that the brunt of the impact from this trend is inevitable and not too far off (certainly within my lifetime and I'm pretty old now).
I'm personally very much in favor of a hybrid socialist system where everyone gets a guaranteed minimum income but people who are able and willing to can still work to earn more. I think this helps in a number of ways, the first being avoiding societal collapse and possible revolution due to the massive amount of unemployed there will be relative to the current population and secondarily, it gives even driven people a buffer to live on while chasing their dreams. I think the end result would actually be more positive for humanity than the current system, though for obvious reasons it will not be supported by the capital gatekeepers who currently wield the money (and thus the power).
I find the idea that any degree of socialism will result in no progress is pretty insulting towards humanity. There will always be people who are driven (whether it be by ego or curiosity or whatever) to do great things.
Speaking from an economics viewpoint, new technology kills jobs temporarily. Eliminating/automating jobs is obviously a good thing over the long term: how often do we lament the cotton gin because of how much cotton harvesting labor it eliminated? Over the short term, it caused job loss for many cotton harvesters, and a concentration of wealth for cotton gin owners. But over the long term, it caused the cotton industry to boom, and created a higher standard of living for everyone. It just took time for the market to reach a new, higher equilibrium. The same thing is happening today with technology, albeit at a much faster pace.
So the real issue is not permanent job loss, but rather how do we take care of people as industry reinvents itself? The pace of this reinvention is accelerating, and has been accelerating for hundreds of years. In the near future, 20 years could result in a completely new job skills need. In fact, compare 1993 to 2013. Entire industries have sprung up while others died since then. Yet we do not lament the advent of the omnipresent internet because of the lost jobs in the newspaper, movie, music, and publishing industries. At least, not most of us. The same thing is simply happening today. Jobs will continue to exist. Just not right away. The real problem is only the short term: figuring out what to do when people get optimized out of some obsolete industry. There are many answers, we just have to think about it.
Socialism is an answer proposed by many people. I think I agree with them to some degree. Some kind of economic floor below which no person can descend. I don't know how this could be created, but I would argue that the "economic floor" has been steadily rising for hundreds of years. In the US, even poverty currently results in a significantly higher standard of living compared to the median income life in 1850.
I think tech's overall optimization/automation effect is good/great for humans, but only if society adapts. In Star Trek's utopia, it's said that the limitless bounty created by tech has basically removed the need for currency and competing economies...but will that happen in reality? If it becomes technologically possible to cheaply produce robots that replaces nearly everyones' jobs...will society be able to say, "Awesome, let's all relax now!"? I can't imagine that we'll ever accept that, even if natural resources become nearly limitless.
The ugly reality is that the effect of automation seems to be further stratifying the haves from the have-nots. By definition, automation makes things cheaper and more profitable by taking away jobs. If there aren't OTHER JOBS also created, we have a situation where the owners are systematically getting richer and the workers are systematically getting poorer.
The way I figure it, jobs would indeed become irrelevant if energy was free or so-cheap-as-to-be-free, and raw materials were also free or so-cheap-as-to-be-free. Labor and natural resources are fundamentally the origin of all value in an economy (IMO).
This doesn't mean we'd instantly all be equal- I would think we could look to communities of the ridiculously-wealthy today, in which case it looks like it would then be about having access to rare or unique things. In other words, no longer about money, but rather connections.
Technology has always been killing jobs, however in the history of man there have always been room for long-term job growth. Otherwise we would not be where we are now. The article is fairly shallow in blaming only one thing for the recession and joblessness. Suddenly the massive debt is no longer a problem, the fact that there are lean manufacturing methods that can compete with mass production is overlooked, etc. The situation really is more complex than one or several journalists can hope to investigate by crunching several time series.
Classically, the new technology created a new class of work to operate/use it or decreased the cost of something so much that it was affordable for the middle class and required a lot more workers to handle the new demand. Now the middle class which benefited from new, cheaper, better products is shrinking with substantial (but by no means comprehensive) evidence that job growth as we've known it in the last hundred years isn't coming back.
Even in software development, there may only be limited growth due to its open and exponential nature. As more developers work on software, the more tools will be developed to make their work more productive and efficient. It's a self reinforcing feedback loop that might have an equilibrium that won't be sufficient to account for all of the jobs lost as a result of software. American manufacturing, for example, is still one of the biggest sub-economies in the world and is insanely productive compared to Chinese manufacturers per person, but it doesn't create anywhere near as many jobs as we have lost overseas. At the same time, manufacturers in industries like medical, aero, and defense are complaining that they can't get the skilled workers they need to grow and as a result are forced to invest way more into automation.
It's very likely that I just can't look at this period of human development without heavy bias but it seems to me that the ridiculously easy flow of information allowed by the internet has destabilized the equilibrium we've had with creative destruction and job growth.
A guy named Peter Frase considered this question in Jacobin magazine a while back (link below). His answer pivots around resources availability and social construction.
Based on these constructs he developed "Four Futures" as follows:
-Egalitarianism and abundance: communism
-Hierarchy and abundance: rentism
-Egalitarianism and scarcity: socialism
-Hierarchy and scarcity: exterminism
Frase definitely swings from one side of the fence, so it may not be your kind of thing - but it's one take on the idea.
This phenomenon is called pauperization. Many countries in Europe experienced it acutely during the early 19th century. People were allowed to starve back then until production shifted to take advantage of the surplus labor. And though people in developed countries are unlikely to starve this time around, the real challenge for us is figuring out how to allow the change to continue (because we will all be better off for it) without destroying people's dignity and/or creating an economically futile and dependent underclass.
Technology can create new jobs, but only if the economic demand is available to support the new professions, products, and fields.
This is where capitalism breaks down: its productive engine is one of the most powerful we know of, but its allocation system continues to write off large and growing portions of the population as undeserving. And the more people are undeserving, the less demand is available to support businesses, so the vast productive power of technology gets "eaten" as profits and rents for capital-owners rather than transformed into innovation and growth.
These are important lessons that the Western world was supposed to have learned through the Great Depression, World War II, and the post-war period of immense peace and prosperity unprecedented in human history. Eventually it's either support a working class (including both the "lower class" and the "middle class") secure and well-off enough to fuel the growth of industry, prop up your economy using government spending, or watch your economy collapse.
From the article:
>Overall, though, technology is eliminating far more jobs than it is creating.
I agree, Technology has and is a great innovator and has created a lot of jobs. But when you begin reducing the number of low-effort jobs, what do you do with the people that used to be employed? It's a fact of averages that 50% of people are below the 100 IQ line - it seems that the new world economy has no place for them.
"For more than three decades, technology has reduced the number of jobs in manufacturing. Robots and other machines controlled by computer programs work faster and make fewer mistakes than humans"
Worst of all, we haven't even seen the robotics revolution yet. In the past, automated assembly lines, manufacturing plants, etc. were the realm of extremely large companies with volumes in the hundreds of millions and billions of dollars. Now, with embedded development becoming more and more accessible and interfaces becoming an important part of software, that automation will become cheaper and cheaper. Pretty soon we'll be able to use off the shelf hardware with Python and OpenCV to program complicated assembly lines and manufacturing pipelines (which we can to some extent already).
The western democracies are in a position to be in a post scarcity world if we choose to be. There is no reason that everyone cannot have the basics of food, shelter, health, and security. We also do not need perpetual 20% unemployment. One important dividend could be increased leisure time. We went from 60 hour workweeks to 40 hours, so why not 30 hour workweeks or 6 weeks of vacation per year. We are mot yet at the point where we can automate tasks that require mobility and some level of skill, such as a UPS delivery person.
I think we are also at the point where we as individuals dont need a barrage of new physical things every year. We can still make significant progress with new virtual products and more efficient and durable physical goods.
"I have never seen a period where computers demonstrated as many skills and abilities as they have over the past seven years." - Andrew McAfee principal research scientist at the Center for Digital Business of MIT.
Technology creates middle-class jobs and wealth by enabling the less skilled to perform tasks they were previously unsuited for. Where did all those factory jobs come from in the first place? The entire idea of assembly line manufacturing was to replace skilled artisans with unskilled repetition. Technology today is no different. The only issue most 'developed countries' have is that it's lifting millions out of poverty worldwide rather than paying union members $70/hr to tighten bolts.
[+] [-] up_and_up|13 years ago|reply
Seem like the real issue lies in the trend toward optimization in every part of the economy, from the small business owner to large corporations etc.
Case in point, I worked for a startup in 2008 that had a FT sysadmin and actual rack servers/real hardware etc. Same guys started a new company in 2012, minus a sysadmin and hardware. The ease/price of EC2 just makes too much sense. I saw that happening.
One has to be careful to watch the trends and not be on the wrong side of history (like a sysadmin who is not open to cloud and devops at this point). But how are most non-tech savvy employees going to keep up with the times? Most likely they will be outmoded and seen as expendable.
My question is how far will that go?
[+] [-] up_and_up|13 years ago|reply
[+] [-] greghinch|13 years ago|reply
The problem is of course the growing disparity between pay. As the existing middle is eliminated, the majority of people are trending towards the lower segment of pay (the 29/2/~70 ratio mentioned). Ideally we'd find a way to elevate a large portion of those in the lower 70% area to higher paying jobs. I think the reality is, many of those people probably will never be suited for jobs in the $100k+ range. The only solution I can see being viable is further socialization (in the US) of things like medical care, transportation, etc. in order to ensure that just because you don't have a high salary, doesn't mean you can't have a high quality of life. Either that or accept that the US is devolving into a 3rd world country.
Bring on the "socialist" flames.
[+] [-] kyllo|13 years ago|reply
The problem with capitalism and tech is that the efficiency gains realized through automation nearly all go to the owners of the firms. The human laborers replaced by programs and robots are just S.O.L. Capitalism only works for a society as long as capital owners need human labor to carry out production.
"The only solution I can see being viable is further socialization (in the US) of things like medical care, transportation, etc. in order to ensure that just because you don't have a high salary, doesn't mean you can't have a high quality of life. Either that or accept that the US is devolving into a 3rd world country."
Yes. Either we implement basic income and universal healthcare, and improve access to public services, or we will end up with a tiny, but very wealthy "owner" class, and a very large, unemployed, impoverished majority.
Better to do it soon, while it's still a choice, rather than later, when it isn't. History has shown that the masses will only put up with so much inequality before they openly revolt.
An opposing force to this, though, is that increased automation will continue to reduce costs and barriers to entry, allowing people with almost no resources to start some form of income-generating online "lifestyle business." A lot of people are doing this now, but not nearly enough people are capable of it, for it to be a sustainable career option for almost the entire American middle class. Yet.
[+] [-] rthomas6|13 years ago|reply
[+] [-] confluence|13 years ago|reply
If you understand what's about to happen - you'll quickly realise that everyone will be out of a job and unless we keep people consuming - things start to get scary - like revolution scary.
We're all socialists now.
[+] [-] jbooth|13 years ago|reply
[+] [-] expralitemonk|13 years ago|reply
[+] [-] RyanZAG|13 years ago|reply
Initially, everyone was required to either hunt or gather food (probably). After a bit, humanity settled down into farming, and fewer people were required to keep everybody fed. This allowed for more time for childbirth. Better understanding of agriculture led to the creation of larger towns with specialized jobs such as blacksmiths and stables which led to farm animals helping to improve yields even further. To create the tools, some people had to go into mining jobs.
The pattern here is that advancement allows fewer people in each economic area to provide the same benefits, freeing up labor for new economic areas.
So clearly, the modern move to automate jobs isn't necessarily anything new. People are now free to move into creating accounting software instead of manually filling out journals. The problem occurs when the people freed up from advances do not have any new work to move into.
The result may simply be de-urbanization - people moving back into the countryside to grow their own food. Most people can afford to buy a small plot of land in the middle of nowhere (small piece of land in the middle of Africa is practically free). Or the result may be socialism. Or the result may be new economic sectors being revealed by innovation. Fortune telling won't get us very far.
[+] [-] georgemcbay|13 years ago|reply
I'd love to see some sign that the US Government is starting to take this issue seriously and planning for it. While we're still years away from this becoming a critical social problem, I do believe that the brunt of the impact from this trend is inevitable and not too far off (certainly within my lifetime and I'm pretty old now).
I'm personally very much in favor of a hybrid socialist system where everyone gets a guaranteed minimum income but people who are able and willing to can still work to earn more. I think this helps in a number of ways, the first being avoiding societal collapse and possible revolution due to the massive amount of unemployed there will be relative to the current population and secondarily, it gives even driven people a buffer to live on while chasing their dreams. I think the end result would actually be more positive for humanity than the current system, though for obvious reasons it will not be supported by the capital gatekeepers who currently wield the money (and thus the power).
I find the idea that any degree of socialism will result in no progress is pretty insulting towards humanity. There will always be people who are driven (whether it be by ego or curiosity or whatever) to do great things.
[+] [-] rthomas6|13 years ago|reply
So the real issue is not permanent job loss, but rather how do we take care of people as industry reinvents itself? The pace of this reinvention is accelerating, and has been accelerating for hundreds of years. In the near future, 20 years could result in a completely new job skills need. In fact, compare 1993 to 2013. Entire industries have sprung up while others died since then. Yet we do not lament the advent of the omnipresent internet because of the lost jobs in the newspaper, movie, music, and publishing industries. At least, not most of us. The same thing is simply happening today. Jobs will continue to exist. Just not right away. The real problem is only the short term: figuring out what to do when people get optimized out of some obsolete industry. There are many answers, we just have to think about it.
Socialism is an answer proposed by many people. I think I agree with them to some degree. Some kind of economic floor below which no person can descend. I don't know how this could be created, but I would argue that the "economic floor" has been steadily rising for hundreds of years. In the US, even poverty currently results in a significantly higher standard of living compared to the median income life in 1850.
[+] [-] danso|13 years ago|reply
[+] [-] angdis|13 years ago|reply
[+] [-] sliverstorm|13 years ago|reply
This doesn't mean we'd instantly all be equal- I would think we could look to communities of the ridiculously-wealthy today, in which case it looks like it would then be about having access to rare or unique things. In other words, no longer about money, but rather connections.
[+] [-] polskibus|13 years ago|reply
[+] [-] akiselev|13 years ago|reply
Even in software development, there may only be limited growth due to its open and exponential nature. As more developers work on software, the more tools will be developed to make their work more productive and efficient. It's a self reinforcing feedback loop that might have an equilibrium that won't be sufficient to account for all of the jobs lost as a result of software. American manufacturing, for example, is still one of the biggest sub-economies in the world and is insanely productive compared to Chinese manufacturers per person, but it doesn't create anywhere near as many jobs as we have lost overseas. At the same time, manufacturers in industries like medical, aero, and defense are complaining that they can't get the skilled workers they need to grow and as a result are forced to invest way more into automation.
It's very likely that I just can't look at this period of human development without heavy bias but it seems to me that the ridiculously easy flow of information allowed by the internet has destabilized the equilibrium we've had with creative destruction and job growth.
[+] [-] dgunn|13 years ago|reply
[+] [-] LDale|13 years ago|reply
Based on these constructs he developed "Four Futures" as follows:
-Egalitarianism and abundance: communism
-Hierarchy and abundance: rentism
-Egalitarianism and scarcity: socialism
-Hierarchy and scarcity: exterminism
Frase definitely swings from one side of the fence, so it may not be your kind of thing - but it's one take on the idea.
http://jacobinmag.com/2011/12/four-futures/
[+] [-] mjolk|13 years ago|reply
[+] [-] joshAg|13 years ago|reply
[+] [-] Permit|13 years ago|reply
He gave an excellent talk called "Are droids taking out jobs?" http://www.ted.com/talks/andrew_mcafee_are_droids_taking_our...
[+] [-] DirtyCalvinist|13 years ago|reply
[+] [-] colmvp|13 years ago|reply
[+] [-] eli_gottlieb|13 years ago|reply
This is where capitalism breaks down: its productive engine is one of the most powerful we know of, but its allocation system continues to write off large and growing portions of the population as undeserving. And the more people are undeserving, the less demand is available to support businesses, so the vast productive power of technology gets "eaten" as profits and rents for capital-owners rather than transformed into innovation and growth.
These are important lessons that the Western world was supposed to have learned through the Great Depression, World War II, and the post-war period of immense peace and prosperity unprecedented in human history. Eventually it's either support a working class (including both the "lower class" and the "middle class") secure and well-off enough to fuel the growth of industry, prop up your economy using government spending, or watch your economy collapse.
[+] [-] Afforess|13 years ago|reply
I agree, Technology has and is a great innovator and has created a lot of jobs. But when you begin reducing the number of low-effort jobs, what do you do with the people that used to be employed? It's a fact of averages that 50% of people are below the 100 IQ line - it seems that the new world economy has no place for them.
[+] [-] confluence|13 years ago|reply
If you get comparable intelligence - well then you're fucked if you do and fucked if you don't.
[+] [-] ScottWhigham|13 years ago|reply
[+] [-] akiselev|13 years ago|reply
Worst of all, we haven't even seen the robotics revolution yet. In the past, automated assembly lines, manufacturing plants, etc. were the realm of extremely large companies with volumes in the hundreds of millions and billions of dollars. Now, with embedded development becoming more and more accessible and interfaces becoming an important part of software, that automation will become cheaper and cheaper. Pretty soon we'll be able to use off the shelf hardware with Python and OpenCV to program complicated assembly lines and manufacturing pipelines (which we can to some extent already).
[+] [-] russell|13 years ago|reply
I think we are also at the point where we as individuals dont need a barrage of new physical things every year. We can still make significant progress with new virtual products and more efficient and durable physical goods.
[+] [-] dkasper|13 years ago|reply
Seriously?
[+] [-] danilocampos|13 years ago|reply
[+] [-] johngalt|13 years ago|reply
[+] [-] shakeel_mohamed|13 years ago|reply
[+] [-] dimitar|13 years ago|reply
[+] [-] notmarxist|13 years ago|reply