Rise of the Machines: We Can Stop Automation From Destroying Society

A Growing Gap

Widespread automation has the potential to amplify existing income disparities and produce an unparalleled level of economic inequality. As artificial intelligence (AI) improves and algorithms get more advanced, automated systems can replace more of the workforce, meaning fewer people are needed to generate the same (or greater) amounts of wealth for those at the top. If technology advances far enough, traditional labor may be rendered obsolete.

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The advancement of technology has never posed quite such a threat in the past as automation has traditionally created new jobs as it replaced old ones. The Guardian cites the example of bank tellers. ATMs appeared in the 1970s, but there are more human tellers now than back then. Today’s tellers do more than dispense cash, though; they sell financial services and provide advice.

However, the ATM example may not apply as AI improves. If ATMs can dispense cash and advise customers about their mortgage options, too, banks may not need human tellers.

This situation only matters if the ownership of wealth is limited, and at this point in the U.S., it is. Right now, unless you own capital, what you have is your wage. Unfortunately, although productivity has improved since the 1970s, wealth has moved toward ownership and more capital, not wages. Wages and labor are the only source of wealth for most people, and they are also one of the only ways workers can assert themselves in the workplace and advocate for change. If automation renders labor redundant, labor as a source of wealth and power in the workplace will evaporate.

Equity and Automation

The very wealthy are not likely to be affected by any of these changes. It’s the people working in industries like transportation, insurance, medicine, and customer service that will be hit the hardest.

The Bureau of Labor Statistics (BLS) reported that more people worked as retail salespeople (4.5 million) and cashiers (3.5 million) in May 2016 than any other occupation. Another 4.6 million people were working in transportation and warehousing as of 2014. Clearly, huge portions of the workforce will be affected by the presence of AI, but this disruption will not have a negative effect on the wealthiest people in the world.

The real issue here isn’t the tech itself — it’s the widening gap between economic classes and the incredible poverty it will cause, not to mention the erasure of the working class. Thankfully, there are several proposed solutions to this potential crisis of equity that don’t require slowing down technological advancement. They include universal basic income (UBI), a tax on robots that replace workers, and job guarantee programs.

UBI has been subjected to heated debate, but many, including Bill Gates and Elon Musk, believe it will be feasible in the near future. Former President Obama has also acknowledged that UBI will need to be seriously discussed within the next 10 to 20 years.

Bill Gates and others have argued that robots that replace human workers should pay taxes — or, more accurately, that their owners should. This would place the existing wage burden back on the wealthy and provide money into the “pool,” which could then be used for UBI or education for workers to take on the new jobs that automation creates. These taxes could also fund job guarantee programs.

Job guarantee programs through the government would guarantee a living wage for anyone doing public sector or non-profit work (depending on the program). This is similar in theory to 1933’s Works Progress Administration program. It also shifts the power away from private owners of wealth, who can demand that workers do whatever menial tasks they want at wages they set, and allows people to do anything from teaching to environmental cleanup for a decent wage.

With the National Bureau of Economic Research reporting that the wealthiest 1 percent of U.S. households held roughly 42 percent of the country’s wealth in 2014, we can’t afford to let automation further widen the gap between the haves and the have nots.

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Three Major Reasons Automation Won’t Leave You Unemployed

Losing Jobs

Right now in the United States there is a duel raging on between who or what to scapegoat for the disappearance of certain jobs. One side blames Mexico and China, international trade, and outsiders generally. The other blames artificial intelligence (AI) and automation, the specter of robots stealing jobs. There is evidence that automation is making some jobs obsolete (almost none that points to trade or immigration). However, both positions are overlooking the real issue: the economy is changing in fundamental ways, and there is no way to stop that change.

By 2020, AIs could be powering 85 percent of customer service transactions, rendering them human-free. That could wipe out a career that, in 2015, employed about six percent of the total American workforce (8 million people) with retail sales and cashier jobs. There are 8.7 million people working in trucking in the U.S., and they are staring down the barrel of self-driving vehicles right now. Automation is also likely to replace humans in the food industry by the mid-2020s. Even back in 2013 it was estimated that about 47 percent of the American workforce were at high risk of losing their jobs to automation.

Via Flickr
Credit: Spencer Cooper/ Flickr

Either we are living in a time which is historically unique for job loss and change, or this is just the next stage in an economic cycle. If the later is the case, then, just as workers moved from agricultural jobs into factories, we are shifting once more. This may sound ominous, but actually, it is good news. It means that there are at least three reasons that automation won’t leave you unemployed.

Trading In D-List Jobs

First, new technologies always usher in new jobs as they eliminate existing positions. Colin Parris, VP of Software Research at GE, explained in an interview with TechCrunch that fighting job losses doesn’t mean resisting automation:

The only way…is to train the talent that we have. Because in the future, we have to embrace robotics. It allows us to reduce cost. If I reduce cost, I have more money that I can use for innovation. The more money I have, the more new products I can create. The more products I create, the more workforce I can hire.

Second, when automation results in job loss, the lost jobs are typically positions that are tough to keep staffed.

“It might take employees out of what we call the ‘three Ds,’ a dull, dirty, or dangerous job,” says Bob Doyle, of the Association for Advancing Automation, to TechCrunch. But “[it] puts them hopefully in a different position that creates more value to the company,” he added. Parris agreed with the “three Ds” position.

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There is no question that automation will eliminate some jobs — “D-list” jobs. Automation frees humans from the jobs no one wants do, jobs that are costing us our health and our lives. And while we’re not always adept with cooperation, we’ll need to do better to thrive in our new economy. Instead of petty squabbling over how much unpleasant work we should each have to do, we might instead just agree to pay ourselves for entrepreneurship and volunteer work — fostering more innovation and more new jobs — through universal basic income schemes as necessary.

Third, our economy will almost certainly shift in ways no one can foresee. Economists today warn of the dangers of “job polarization,” the division of human workers into either highly skilled and unskilled classes, with middle-of-the-road jobs lost. However, part of the reason we may not be able to envision a new middle class yet is that we are not yet reeducating ourselves well enough to perceive what the new jobs of the automation era look like.

“We can’t predict what jobs will be created in the future, but it’s always been like that,” says Joel Mokyr, an economic historian at Northwestern University, said in an interview with the Economist. “[The video-game designers and cybersecurity specialists] are jobs that nobody in the past would have predicted.”

The important question isn’t who is “stealing” jobs, because they are gone — or soon will be — never to return. Why should we want dangerous, dirty, and dull jobs back; we can innovate and create new jobs as we have in the past. Now, we must either retrain our workforce to master these economic changes or face the growing gap between educated and non-educated workers. Let’s hope we choose the former.

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New Study Finds That Six Jobs Are Lost for Every Robot Added to the Workforce

The Real Impact of Automation

Few subjects are quite as divisive right now as the potential impact of automation on employment. Some, like U.S. Treasury Secretary Steven Mnuchin, believe we needn’t be concerned, while others assert that we are already at the start of the biggest workforce upheaval since the Industrial Revolution.

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Now, a new paper released by the National Bureau of Economic Research (NBER) puts an actual number to the threat of automation: each industrial robot introduced in the workforce between 1990 and 2007 coincided with the elimination of 6.2 jobs within the commute area. Wages also saw a slight drop of between .25 and .50 percent per 1,000 employees when one or more robots was added to their workforce.

The report’s authors, economists Daron Acemoglu from the Massachusetts Institute of Technology and Pascual Restrepo of Boston University, predict that we could see as much as a .94 to 1.76 percent decline in the employment-to-population ratio by 2025. By 2025, the Census Bureau estimates the United States’ population will reach 347.3 million. That means between 3.3 to 6.1 million jobs could be lost to automation.

Looking Ahead

In total, roughly 670,000 manufacturing jobs were lost to robots during the period of the study, a number that is expected to only go up given how more and more companies are looking toward automation as a way to improve operations in the coming years.

Consultancy firm PricewaterhouseCooper is already predicting the loss of 30 percent of jobs in the United Kingdom to automation. A separate study conducted by the International Labour Organization noted that 137 million workers across several Southeast Asian countries are in danger of being replaced by automated systems in the next 20 years.

The disruption isn’t confined to blue-collar jobs, either. Experts also believe that it will ultimately disrupt white-collar professions as well, a belief supported by the recent news that the biggest money-management firm is laying off 13% of its portfolio managers due to automation.

Add the Census Bureau’s predictions to the ever-growing list of studies that see robots disrupting the workforce, and the threat of automation becomes all-too-real. Even more modest scenarios see the number of industrial robots increasing by about threefold in the next 10 or so years.

That said, researchers and policy makers are already looking for ways to address the seemingly inevitable mass displacement that will be brought about by automation. Several are considering and testing universal basic income (UBI) programs, which would allow the government of a country to ensure that dramatic employee displacement wouldn’t lead to economic instability. Another suggested system involves taxing industrial robots, as suggested by Bill Gates.

The fact is, automation will have an impact on the current employment status quo. The gravity of its effects and what we can do to address them is an important conversation that we most definitely need to be having right now.

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Major Firm Announces It’s Replacing Its Employees with A.I.

Automated Money Managers

It was only a matter of time before the impact of robots and automation would start having an effect on the white-collar workforce. Case in point: BlackRock, Inc, the world’s largest money manager, just announced that it plans to transition toward automated solutions.

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The decision to transition comes after news of a massive overhaul that involved a reorganization within BlackRock. The purpose of the reorganization was to place a greater emphasis on computer algorithms that can inform investments. Quite simply, investors are now questioning whether having a human manage their money is worth the fees they require, especially since successful money management is essentially anchored on recognizing and following certain market indicators — the sort of things artificial intelligences (AI) can be programmed to do.

In light of that, BlackRock plans to merge traditional investing methods with technology and data science. This strategy marks the biggest shift in traditional stock picking by a major asset manager to date. It will impact $30 billion worth of assets, and roughly 13 percent of BlackRock’s portfolio managers will be laid off as part of the transition.

White-Collar Concerns

Talk of how much automation will disrupt the traditional workforce has mostly centered on blue-collar industries, but this move from BlackRock demonstrates that the very real implications of technology on the job market aren’t limited to professions defined by easily replicated manual labor.

Jobs in stock picking and money management are some of the most lucrative, and yet, given BlackRock’s decision to turn to machines and algorithms to refine their services, even those knowledge-based professions are vulnerable to automation.

“We are starting to see in fields like medicine, law, investment banking, dramatic increases in the ability of computers to think as well or better than humans. And that’s really the game-changer here. Because that’s something that we have never seen before,” public policy expert Sunil Johal told CBC News in reference to robots taking over white-collar professions. Millions of workers worldwide are expected to be displaced by automation, and even the best algorithm can’t predict right now what the impact of that will be.

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CEO Disagrees With Trump Official’s Automation Prediction: “It’s Gonna Happen”

Fast Food Automation

How will technological innovation shape the future of the workforce? According to Greg Creed, the CEO of Yum Brands, the parent company of popular fast food chains like Pizza Hut, KFC, and Taco Bell, automation could replace humans in the food industry by the mid-2020s.

Creed shared this prediction in an interview with CNBC:

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I believe, having listened to people in the artificial intelligence area — and we’re starting to work with them in that area — I think [50 to 100 years]  is way too long. I think it’s going to happen — I don’t think it is going to happen next year or the year after, but I do believe that probably by the mid ’20s to the late ’20s, you’ll start to see a dramatic change in sort of how machines sort of run the world.

But that’s not to say that humans will be completely obsolete. “We don’t make a lot of things until customers order,” explained Creed. “I’m not sure we’re going to have robots replace people.” That said, he notes that the rise in automation today marks “the beginning of robotics […] but I don’t see it wholesaling — the wholesale sense changing people’s jobs in the short-term.”

In contrast, U.S. Treasury Secretary Steven Mnuchin says that automation isn’t an imminent threat to American jobs. He notes that he’s “not worried at all” about machines displacing human workers and that artificial intelligence (AI) taking over jobs won’t happen for another 50 to 100 years.

Widespread Impact

Right now, several blue-collar industries are already feeling the effects of automation. For instance, the Rio Tinto mining company has already deployed a fleet of 73 self-driving trucks that haul payloads at a cost 15 percent less than those operated by human drivers. In developing nations in Southeast Asia, where 137 million people depend on manufacturing jobs as their main source of income, a study notes that many workers are in danger of being replaced by automated systems in the next 20 years.

While its impact on white-collar jobs isn’t currently quite as pronounced, experts believe that automation will have significant implications within several of those industries as well. A report from Deloitte Insight states that an estimated 114,000 jobs in the legal sector have a high chance of being replaced with automated machines and algorithms within the next two decades.

These predictions are premised on the fact that machines are now more than capable of completing the repetitive jobs that many human workers are handling today. Given the advancements in the field and the focus people are putting on further developing the technology, it’s only a matter of time before we truly begin to feel the real effects of automation across multiple industries.

“I think it’s gonna happen,” Creed said. “We’ll see a dramatic change in how machines run things.”

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Trump’s Treasury Secretary Says Increased Automation Is “Not Even on Our Radar”

During his campaign, now-President Donald Trump promised voters he would bring American jobs back from overseas. Now that he is in office, his administration has made job creation a central focus of its efforts.

But what if those jobs overseas can’t come back to the United States because companies no longer need to hire humans to complete the tasks? How is the Trump administration gearing up to tackle the rise of automation?

Wikimedia Commons
Photo Credit: Wikimedia Commons

Based on recent statements by Trump’s Treasury Secretary, Steven Mnuchin, they aren’t planning to address it all. In a conversation with Axios co-founder Mike Allen, Mnuchin said that increased automation is “not even on our radar screen” as the problem is “50 to 100 more years away.” He continued, saying, “I’m not worried at all. In fact, I’m optimistic.”

They’re Not Coming Back

The administration’s claims run counter to the mounting evidence that artificial intelligence (AI) and automation are a much more imminent threat to American workers.

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Some reports predict that today’s technology could automate 51 percent of economic activity. Such a shift has the potential to cause unprecedented levels of unemployment, putting millions of people out of work. It’s not just blue-collar jobs that are at risk, either. Another report expects that 850,000 public sector jobs could be taken over by automation in the United Kingdom by 2030, a trend likely to carry over into the U.S.

According to Mark Muro of the MIT Technology Review, jobs that went overseas aren’t going to be coming back to the U.S. Trump can propose policies to make it more beneficial for companies to bring their operations back to the country, but there’s nothing to stop them from replacing American workers with machines should the financial implications of doing so continue to become more attractive.

As Muro said, “No one should be under the illusion that millions of manufacturing jobs are coming back to America.”

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