Why we ignore Technological Unemployment

We need to ask why we ignore technological unemployment because it could quickly unravel our social and political fabric.

For instance, Andrew Yang’s recent success in the Democratic presidential primary is shocking pundits. Predictably, the intelligentsia cannot understand why average people are listening to a candidate who views technological unemployment as America’s greatest problem.

The chattering classes’ inability to grasp Yang’s appeal shows why technological job loss is so dangerous. The frightening truth is most technology-driven unemployment is unseen, and often unrecorded.

 Why we ignore technological unemployment because it is easy

We ignore technology-driven job loss for several poorly understood but fairly obvious reasons.

First, most unemployment by technology occurs to working and lower middle-class people; two groups our intelligentsia does not care about. For instance, most technological job-loss is occurring in supply chain, manufacturing, back office, retail, and other fields populated by less-educated individuals.

Hence, a typical victim of job-killing tech is a middle-aged woman with a high school degree who has worked as a file clerk for decades. Today; however, there are no paper documents to file at many offices so that woman is stocking shelves at Walmart. Thus the job loss is a step down the social ladder and a cut in pay.

Disturbingly, automation now threatens the woman’s new job. Predictably, the media is paying little attention to Walmart’s deployment of robot janitors and stock clerks in its stores. My guess is most reporters never go to Walmart, and it will shock many of them to discover Walmart is still in business.

Job Loss by Technology at Walmart

Importantly, people of color, uneducated women, working-class whites, uneducated men, rural whites, and other groups the educated elite despises usually fill the jobs lost to machines. Hence it is easy for intellectuals and executives to ignore technology’s destruction of jobs.

Second, most of the technological job loss is neither sexy nor glamorous. For example, Walmart killed 7,000 back-office clerical jobs in 2016 with cash-counting machines. Cash-counting or bill-counting machines are hardly an impressive innovation; they’ve been around for 50 years, yet Walmart’s use of them changed 7,000 lives.

Why the Media Ignores Technological Job Loss

Third, much of the job-killing innovation happens behind the scenes or in places reporters never go like factories, back offices, file rooms, or fulfillment centers. For instance, Kroger’s (NYSE: KR) building of fulfillment centers that use swarms of Ocado Group PLC (LSE: OCDO) robots to move and pack groceries.

Fourth, the media often gets the jobs and technology story wrong. Notably,  reporters ignore developments occurring now like the use of robots and the digitalization of back office jobs. To clarify, digitalization occurs when organizations replace clerks with algorithms.

For instance, when I pay my insurance bill online I eliminate the need for several jobs. The first loser is the letter carrier who takes the payment to the post office. The next losers are the people who sort the mail and the truck drivers and pilots who move the mail. Then there is the letter carrier who takes the bill to the insurance company.

Next comes the mail clerk at the insurance company sorts and opens the mail. Finally, the person who processes the check at the insurance company or the bank is redundant and unemployed.

Unfortunately, a high school dropout losing her job sorting mail or opening envelopes is not a good news story. However, that is the real face of technological unemployment in America.

How the Media Gets Technological Job Loss Wrong

Fifth, most of the news stories about technology and jobs focus on the glamorous or scary sci-fi angle.

For example, all the stories about robotics that feature pictures of the Terminator or a Transformer. In addition, all the stories about self-driving trucks, delivery by drones, and fiction-writing artificial intelligences (AI). Yes, those developments are plausible but they are years away.

In reality, industrial robots are boring. Instead of sci-fi monsters industrial robots look like any other piece of machinery. Hence, editors and producers dislike them. To explain, a lot of news organizations refuse to run any story that does not include cool-looking imagery.

Consequently, some editors make it easy to ignore technological unemployment by adding pictures of sci-fi robots to every robot or automation story. Thus, it is easy for readers dismiss job-killing technology as a fantasy until it happens to them.

Sixth unemployment by technology is a gradual process that slowly eats away jobs. In general, no jobs disappear when new tech shows up. Instead, the number of employees slowly falls as management realizes it can do more with fewer people.

For example, a big retail store installs automated checkout; and keeps its cashiers, but hires no replacements as they retire or quit. Instead, the human cashiers slowly vanish.

We Need to Talk about Technological Job Loss Now

Our refusal to discuss technological unemployment will make the catastrophe it unleashes worse.

We must discuss technology-driven job less because it most affects the most vulnerable members of our society. For example, all the retail janitors, assistant managers, stockers, and cashiers who are living at the poverty line. If their jobs disappear, many of those people will be homeless.

In addition, a single mother, an immigrant, or a person with disabilities is more likely to fill a cashier‘s job. If those jobs vanish, the welfare rolls will grow and we will pay more taxes.

Moreover, as Yang correctly tells Joe Rogan, there is no way we can reeducate every technologically unemployed person for new work. For example, you cannot teach most cashiers, janitors, or welders to write computer code as some intellectuals think.

Nor are we likely to teach a 45 or 50 or 60-year-old former secretary, file clerk, truck driver, welder, or oil-field roughneck to design websites. Moreover, even if we could retrain everybody, our society only needs a few coders and web designers.

We ignore Unemployment by Technology at Our Peril

I suspect it will take a catastrophe to alert our leaders to the menace of technological unemployment. 

My guess, is it will take anti-technology riots; or the election of a Luddite candidate to a major office on the “smash the machines” ticket, to make our leaders take notice. Our journalists, politicians, executives, and thought leaders have gotten so used to ignoring technological unemployment, it will take a major shock to get them to pay attention.

The habit of ignoring technological job loss is one we must unlearn. If we do not, Andrew Yang’s political success will be the first of many nasty surprises for our so-called leaders.