New report shows automation is already cause losings, depressing wages and likely to have lasting, devastating effect

In 2013, the Oxford Martin School released a report that looked at the automation of job, assessing the likelihood that robots and other technologies would supplant humans. It concluded that of the 702 occupation categories analyse, 47% were susceptible to automation within the next 20 times. The report entirely upended our notions about the future of work.

Now, a new report by the National Bureau of Economic Research( NBER) in the United States is set to be an even bigger wake-up call. Written by economists Daron Acemoglu( MIT) and Pascual Restrepo( Boston University ), it not only adds support to the Oxford Martin conclusions, it actually proposes the jobs are already lost and unlikely to come back.

It contends that in the US between 1990 and 2007, the addition of each robot into manufacturing industries resulted in the loss, on average, of 6.2 human occupations. It likewise proposes automation depressed wages by between a quarter and a half of one per cent. Using such an approach, the report mentions, we calculate large and robust the negative consequences of robots on employment and wages across commuting zones.

There is another important insight: these occupations losings and lower wages are likely to have a lasting and devastating effects. Author Daron Acemoglu told the New York Times that, even if overall jobs and wages recover, “theres been” losers in the process, and its going to take a very long time for these communities to recover. The market economy is not going to create the jobs by itself for these workers who are bearing the brunt of the change.

These are game-changing findings, so let me throw them into context of the overall debate.

There has been a rather unproductive back-and-forth over whether or not robots are going to take our occupations. This dead end approach was something I warned about in my volume Why The Future Is Workless when I wrote, Lets not go down the same road we have with climate change and mindlessly divide ourselves into camps of sceptics and advocates. Lets instead bypass the ultimately futile debate about whether or not robots will take our occupations( they will )~ ATAGEND and induce the imaginative leap, together, into a workless future that can liberate us all.

Much of the debate has rested on the claim that technology ultimately generates as many occupations as it destroys( an approach that author Calum Chace calls the reverse Luddite fallacy ).

Probably the most influential supporter of this argument is MIT economist David Autor. His important paper, Why Are There Still So Many Jobs ?, although careful to allow for the fact that past behaviour is not always a great predictor of future outcomes , nonetheless notes that writers and even expert commentators tend to overstate the scope of machine substitution for human labour and discount the strong complementarities between automation and labor that raise productivity, raise earnings, and augment is asking for labor.

As lately as last week, Australian economic commentator, Ross Gittins, operated a similar line in a strongly worded part decrying so-called futurologists for intimidating everyone about job losses. He wrote, improving the productivity of a nations labour increases its real income. When that income is invested, occupations are created somewhere in the economy. Technological advance doesnt destroy occupations, it displaces them from one part of the economy to another.

This claim, of course, was always just as much a guess about the future of job as anything is proposed by dreaded futurologists, but the point is, the NBER report attains it even more tenuous than it was. In fact, Acemoglu and Restrepo specifically argue there is little evidence of new jobs being created, saying the results indicate a rather limited fixed of offsetting employment increases in other industries and occupations.

What gives the NBER report added authority is it doesnt will vary depending on modelling to predict what robots are likely to do to jobs in the future, but on hard data to look at what robots are already doing to jobs in the present. The results are so startling that even the authors were surprised, having previously taken a much more sceptical line.

So where does this leave us? Well, we need to keep things in view. The future of work is a hugely complex issue, social and political as much as technological, and one new report, however important, scarcely settles the issues. Nonetheless, Acemoglu and Restrepos findings do devote us a new baseline for our discussions.

In so doing, they will likely reanimate calls for a universal basic income ,~ ATAGEND because if there really are fewer occupations, we are going to need new ways of distributing wealth.

The report likewise challenges the neoliberal doctrine that unregulated marketplaces are a surefire route to full employment, and it was reasonable to be taken to connote a large role for governments in managing the change that is coming. Additionally, it undermines the lingering claim that technology will create enough jobs in the future because this is what happened in the past.

Most importantly, the results suggest politicians and others who carelessly promise jobs and growing need to stop hesitate and start taking seriously the fact that the future of work is going to be a very different animal to the past and present of job. We are likely to face not just different sorts of job, but far fewer occupations.

How we respond to this reality will be a huge exam for our republics, and this report is an important contribution to the ongoing debate.

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