Some anxious forecasters project that robotics, automation and artificial intelligence will soon devastate the job market. Yet others predict a productivity fizzle. The Congressional Budget Office, for instance, expects labor productivity to grow at the snail’s pace of 1.3% a year over the next decade, well below the historical average.Read more here.
There’s reason to reject both of these dystopian scenarios. Innovation isn’t a zero-sum game. The problem for most workers isn’t too much technology but too little. What America needs is more computers, mobile broadband, cloud services, software tools, sensor networks, 3-D printing, augmented reality, artificial intelligence and, yes, robots.
For the sake of explanation, let’s separate the economy into two categories. In digital industries—technology, communications, media, software, finance and professional services—productivity grew 2.7% annually over the past 15 years, according to the findings of our report, “The Coming Productivity Boom,” released in March. The slowdown is concentrated in physical industries—health care, transportation, education, manufacturing, retail—where productivity grew a mere 0.7% annually over the same period.
...Fortunately, many physical industries are poised for dramatic transformations into digital industries—if we let them.
The shale oil and gas boom is an IT story, since 3-D modeling of underground formations enables horizontal drilling and hydraulic fracturing in the right places. This shift to digitized mining has not destroyed jobs. Rather, hours worked in oil and gas rose 17% since 2007.
Or consider the digitization of retail and distribution. E-commerce has added 397,000 jobs since December 2007, which more than makes up for the 76,000 full-time-equivalent jobs lost at bricks-and-mortar stores.
Sunday, May 14, 2017
"The problem for most workers isn’t too much technology but too little."
Bret Swanson and Michael Mandel report at the WSJ,