While many people are getting excited about the idea of smart machines, perhaps we should hold off. New research shows that the use of smart machines could lead to the loss of 80 million jobs in the United States and 15 million jobs in the United Kingdom. These jobs would become automated, causing the humans working the jobs to be laid off and replaced by robots. The study was conducted by the Bank of England’s Chief Economist Andy Haldane.
However, it isn’t all bad, as many new jobs will also certainly be created from smart machines. It’s not like America will have a net loss of 80 million jobs. Still, the idea of “technological unemployment” has been scaring people for generations. The idea is that technological innovations require less people to work, while also leading to a decrease in wages.
That being said, Haldane says that most technological advancement has led to increased wages and enhanced jobs. Usually, the associated technology requires that people increase their skills in order to adapt. The economic boost from technological breakthroughs also results in an increase in wages. In essence, skills, wages and productivity are all positively correlated and increase together.
But there is a downside. These increases in skills and wages also lead to a larger gap between workers with high skills and workers with low skills. As people who are highly skilled earn more money for their capabilities, people who can do routine jobs earn less. Technological advancements can also lead to the creation of unskilled jobs, in which people earn very small amounts of pay. Not every job that comes about because of new technology requires a high level of skill or a specific expertise.
With possible automation, up to 80 million American jobs could be lost in the future. Many of these jobs are in the fields of administration, clerical and the production of goods. It is unknown how many jobs would be replaced by people working to develop and maintain the new automated mechanical workers.
Luckily, many jobs are unlikely to ever be replaced. People are unlikely to trust a robot to cut their hair or supervise their children. Even then, we’re still many years away before the use of robots start replacing humans on a large scale. But when it does happen, there could very well be some serious economic implications.