A world with vastly fewer jobs will threaten social order
Will robots steal our jobs? It is a common and increasingly urgent question. Throughout history, ‘technological unemployment’ has turned out to be less severe than feared: new jobs and whole new sectors have always emerged in response to new technology. But what if, this time, the destruction of jobs is not counterbalanced by job creation elsewhere?
In A World Without Work, the Oxford economist Daniel Susskind suggests that we are moving into uncharted territory. In developed countries, the share of income that goes to labour is declining. Wealth is shifting from ‘human capital’ to ‘traditional’ capital (property, shares and so forth). If automation reduces demand for people, eroding workers’ bargaining power, this trend will accelerate.
We have already seen the growth of low-skilled jobs with businesses such as Uber and Amazon. They tend to be poorly paid, uncertain and, in time, many may be replaced by autonomous robots. Even jobs in service industries and care are vulnerable, as the example of care robots in Japan already shows. On top of that, organizations are likely to cut middle managers; then there is the prospect of machine learning taking work from today’s well-paid professionals in medicine, law, teaching, and so on. There will come a point when machines will be cheaper than using people. Only at the apex of organizations will jobs be safe.
An exaggeration? Maybe, but Susskind argues the direction of travel is clear, even if the timing and extent are uncertain. Perhaps 25% of the population will end up never working, with most of the rest earning only a little above minimum wage. It is a gloomy prospect. The technological tide is unlikely to reverse, so what can we do? Interestingly, most of the potential solutions are essentially political. Take the question of who would pay for social provision when far fewer people are in work. It could only be those people still earning big salaries, those with large concentrations of capital, and the small number of wealthy tech companies. Yet these groups are notoriously successful at avoiding tax: changing that will take coordinated international action and determined political leadership.
Spreading out the work that is still available, for instance by reducing the working week, could delay the effect of the trend but not halt it. As for upskilling, options are limited: with record numbers of school leavers going into higher education, developed nations are already near the limits of skills policy, although generous support for lifelong learning might help. More radically, the notion of a universal basic income is attracting attention, although trials to date have proved inconclusive.
Of course, work also provides non-monetary benefits, not least status and a sense of purpose. It could be argued that the extent of purpose in business is exaggerated – in the US, polling suggests 70% of workers are either ‘not engaged’ or ‘actively disengaged’ – but at least work fills the day. If large numbers of people aren’t working, the state may need to help them find purpose. How, though? And would people accept it? We may find that the state has no option but to try: people who are deprived of status get angry. As Covid-19 has shown around the world, pressing threats to health and jobs can quickly lead to previously unthinkable policy responses.
Many of Susskind’s proposed solutions look thin or problematic, and are contingent on political will. Business will have to play its part, too. If Susskind is even partly right about the loss of work that lies ahead, be prepared for a bumpy ride.