In a good article at Reason on technological unemployment I found an interesting tidbit:
You can think of this another way: The average American worker today would only have to work 17 weeks per year to earn the income his counterpart brought in 100 years ago, according to Autor’s calculations—the equivalent of about 10 hours of work per week. Most people prefer to work more, of course, so they can afford to enjoy the profusion of new products and services that modern technology makes available, including refrigerators, air conditioners, next-day delivery, smartphones, air travel, video games, restaurant meals, antibiotics, year-round access to fresh fruits and vegetables, the internet, and so forth.
But if technologically fueled productivity improvements boost job growth, why are U.S. manufacturing jobs in decline? In a new study published in April, Bessen finds that as markets mature, comparatively small changes in the price of a product do not call forth a compensating increase in consumer demand. Thus, further productivity gains bring reduced employment in relatively mature industries such as textiles, steel, and automobile manufacturing. Over the past 20 years, U.S. manufacturing output increased by 40 percent while the number of Americans working in manufacturing dropped from 17.3 million in 1997 to 12.3 million now. On the other hand, Bessen projects that the ongoing automation and computerization of the nonmanufacturing sector will increase demand for all sorts of new services. In fact, he forecasts that in service industries, “faster technical change will…create faster employment growth.”
One of the implications of that is that the greater your efforts to prop up “mature markets” the more you will suppress the growth of new jobs.
Do you remember that picture of my nephews and nieces I posted a while ago? Most of them have jobs that didn’t exist 25 years ago and I believe that only one or two of them have jobs that existed a century ago.
