Middle-Skill Jobs Disappearing as Machine Intelligence Progresses

The Financial Times notes (registration required) that economists are starting to notice that moderate-skill jobs are disappearing, and this challenges the whole basis under which we allocate resources, in exactly the way predicted by Norbert Wiener in the 1950s. (Link goes to an article claiming that Wiener was proven wrong. But perhaps he was just premature?)

What is sobering is that we have already seen convincing evidence of the impact of technology on the job market. Alan Manning of the London School of Economics coined the term “job polarisation” a decade ago, when he discovered that employment in the UK had been rising for people at the top and the bottom of the income scale. There was more demand for lawyers and burger flippers. It was middle-skill jobs that were disappearing. The same trend is true in the US, and is having the predictable effect on wages: strong gains at the top, some gains at the bottom, stagnation in the middle.

Of course cheap, ubiquitous computing power has brought many good things – and will bring more. The question is whether we are equipped to deal with the possibility that in future, there will be people who – despite being willing and fit to work – have no economic value as employees. By the time today’s 10-year-olds have their degrees, computers could be a hundred times cheaper and smarter than they are today. A future full of robot servants could be a bright future indeed, but only if we can adapt our institutions quickly enough.


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  2. RP Jr. points to "Don't Blame the Robots".

    My first impression is doubt, though. Economists seem to view everything through the lens of their theories. Which theory is more broken seems beside the point. I am reluctant to fire somebody if they are replaceable by a machine, but not at all inclined to hire somebody if a competitive machine is available. Isn't that sort of obvious?

  3. That's mostly neither here nor there, albeit interesting in other contexts.

    The point is that while social inertia may slow the trend, it makes it a ratcheted one-way process. Jobs replaced by steam and steel do not come back. Jobs replaced by screens and scripts will not fare better.

    Happy New Year!

  4. Word. We have a project going on now to forecast/predict/speculate/prognosticate/guess what "the industry" will want from firms such as ours in 10 years. I've suggested that much of the work we do (engineering, inspection, laboratory testing) will be automated. Even construction inspection and materials sampling in the field. I'm laughed at (out loud behind my back, diplomatically in my face). "How can a robot inspect a weld?" I'm asked. "Well, a robot will install the weld" I reply. "Ha, never" they respond. "Sure, have a look at a Toyota plant in Japan or, for the matter of that, a steel building being erected in Japan" is my rejoinder. "If a robot can install it, it either doesn't need our services or a robot will perform quality assurance on the weld/bolt/concrete placement/fireproofing/etc."

    But people to create and implement strategy, deploy capital, and bank the proceeds (capitalists, that is) will still be needed so, hopefully, so will I. Salespeople too may still be needed. What will all the inspectors and engineers and lab technicians (and scientists and mathematicians) do to put food on the table? I have no answer but it will be very difficult to convince the 1% to fund the leisure of these. Perhaps we'll all be Yudkowsky trans-humans and such questions will become irrelevant.

    Happy New Year to you and Irene as well!

  5. The robots have obviously already taken over all the top finance jobs.

    "The Changeling*"
    -- by Horatio Algeranon

    Nomad ain't got squat
    On Wall Street banker bot
    Whose logic is pure greed:
    No self-destructive seed.


  6. "Economists seem to view everything through the lens of their theories."

    Whereas everyone else views things with perfect objectivity? Newp. *Everyone* views things through the lens of their particular models/theories. I presume you mean, "economists view everything through the lens of their theories and I think those theories are stupid."

  7. Guess peeps have probably seen this at Slashdot reporting Friedman's take?

    "We need to rethink deeply our social contracts, because labor is so important to a person's identity and dignity and to societal stability. We've got a lot of rethinking to do because we're not only in a recession-induced employment slump. We're in technological hurricane reshaping the workplace."

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