Are robots and other technological innovations reducing the number of manufacturing jobs? Evidence seems to point in that direction.
The Wall Street Journal recently noted that: “In no other U.S. recovery since World War II have companies been simultaneously faster to boost spending on machines and software, while slower to add people to run them. Since the economy began growing again in 2009, spending on equipment and software has surged 31 percent, adjusted for inflation. Private-sector jobs have grown just 1.4 percent over the same span. Only recoveries following the 1980 and 2001 recessions saw slower job growth.”
But just because spending on manufacturing technology is growing faster than jobs, doesn’t prove that equipment spending is the cause of lower job growth. What about the new jobs that are created by all that spending on manufacturing equipment?
The International Federation of Robotics (IFR) commissioned a study to determine how many jobs the robot industry has created. The study shows that the robotics industry has created eight to 10 million jobs worldwide and will add another one million by 2016.
The report’s author, Peter Gorle, notes that robots are being used to carry out work that would not be economically viable in a high-wage economy, thus allowing manufacturing to remain in high-wage countries.
Today, machines are developing capabilities that were always thought to be distinctly human, such as the ability to understand speech, respond to questions, and make simple decisions. The result is that automation is moving into the service sector where human workers have previously been free from competition.
In 2004, Frank Levy and Richard J. Murnane, published The New Division of Labor which analyzed the capabilities of computers and human workers. Truck driving was cited as an example of the kind of work that computers could not handle. Yet, Google recently announced that its robot driven cars have logged over 200,000 miles on American roads with only an occasional assist from human drivers.
In my opinion, any effort to discourage the adoption of the latest manufacturing technology in the hopes of preserving jobs would be self-defeating. Holding back the pace of technological innovation would cause jobs to flee rapidly to other jurisdictions where innovation is free to flourish.
Our goal instead should be to accelerate the pace of innovation in order to maintain the vitality of our manufacturing industries and encourage the growth of highly-skilled, highly-paid jobs building, operating and maintaining robots and other high tech equipment.