The Robots Are Coming For Your Jobs
- Charlie Biscotto
- Jan 27, 2017
- 4 min read
Donald Trump is already focusing on protectionist trade measures designed (in theory) to keep manufacturing jobs in the United States. These efforts are likely to have a minimal net-positive effect on the overall U.S. economy (though plenty of benefits for the Chinese economy), because our biggest job-stealers are not people in other countries. They're not people at all. They're robots.
We've written before that Trump's claims of job-saving during his transition were overblown and not actually helpful for the long-term growth of the economy, especially as they could lead businesses towards praising Trump in exchange for his Twitter blessing. That exact scenario has played out, with Bloomberg posting a thorough analysis of which job-saving claims had validity (spoiler alert: not many). The confusion of CEOs trying to be honest about their businesses while still getting acclaim from Trump even led MSNBC and CNBC to post articles on the same day respectively crediting and discrediting Trump for a decision to keep jobs here based on interviews with CEO Mark Fields.
According to Wolfgang Lemacher at Fortune, we've lost 5 million jobs in manufacturing since 2000, and yet we've increased our manufacturing output. What accounts for that? From the same article:
Investment in automation and software has doubled the output per U.S. manufacturing worker over the past two decades. Robots are replacing workers, regardless of trade at an accelerating pace. “The real robotics revolution is ready to begin” writes BCG and predicts that “the share of tasks that are performed by robots will rise from a global average of around 10% across all manufacturing industries today to around 25% by 2025.”
From Federica Cocco at the Financial Times:
The Boston Consulting Group has estimated that while “a human welder today earns around $25 per hour, including benefits, the equivalent operating cost per hour for a robot is around $8”.
The extra cost of maintaining a robotics system — installation, maintenance and the operating costs — should be amortised, according to the group, over a five-year period. “In 15 years, that gap will widen even more dramatically,” it says. This process, as many have pointed out, is irreversible.
The jobs are going. They've been going. And it's a very small percentage that have been going to China- so few, in fact, that we're producing at record levels. Donald Trump's own choice for labor secretary is aware of this fact, and wants to drive down minimum wage to make humans more cost-effective to combat it, so in theory he has a plan. But the long-term economics of automation are likely what is keeping some factories open. When robots are doing most of the work, it won't matter if wages are peanuts in developing countries. It'll still be cheaper to get goods to American markets if the factories (populated by robots) are here.
This isn't all bad news for American workers. There are new jobs to be had in technology and robotics as artificial intelligence develops. The problem is that these are all highly skilled jobs that require higher levels of training and education. From Claire Cain Miller at the New York Times:
Over time, automation has generally had a happy ending: As it has displaced jobs, it has created new ones. But some experts are beginning to worry that this time could be different. Even as the economy has improved, jobs and wages for a large segment of workers — particularly men without college degrees doing manual labor — have not recovered.
The people most likely to be negatively affected by automation are Trump's voting base. They're older, they're less educated, and they're less comfortable with technology. Rather than develop plans for how to handle the transition our economy is definitively undergoing, Trump has promised to take those voters to a past era where manufacturing jobs for the poorly educated were plentiful.
But try as he might, Trump can't invent a time machine. He can't take away the technological advancements we've made. He can't make humans smarter or more efficient than the robots being developed to replace them. More forward-thinking officials in San Francisco and Ontario, Canada are experimenting with a Universal Basic Income, which would shift our economic model and social safety nets to adjust for a world where robots are driving the manufacturing industries. Others have proposed a guaranteed jobs program, which emphasizes the personal fulfillment and meaning derived from having a job, any job. Both are forward-thinking and acknowledge that our economy is about to change drastically.
By focusing on imports from Mexico and China, Trump does a disservice to his voters. He's selling them snake oil, praising Carrier for keeping 700 jobs and cutting another 1,000. Where the factories are right now is immaterial; it only changes whether the robots are taking American jobs or foreign jobs over the next decade. If Trump really cared about the "poorly educated," he'd be focused on job training, technology, and forward-thinking modes of adapting to the new economy. But then he'd actually have to study the facts of the problem, and we all know how he feels about those.