Information technology is reducing the need for certain jobs faster than new ones are being created.
A job to do: Much as the Luddites feared mechanical looms
200 years ago, today’s middle-class workers have reason to worry that
information technology erodes their employment prospects. Credit: Mary
Evans Picture Library/Alamy
Things Reviewed:Race Against the Machine: How the
Digital Revolution
Is Accelerating Innovation, Driving Productivity,
and Irreversibly Transforming Employment and the Economy
Erik Brynjolfsson and Andrew McAfee
October 2011
“The Growth of Low Skill Service Jobs and the Polarization of the U.S. Labor Market"
David Autor and David Dorn
June 2011
The United States faces a
protracted unemployment crisis: 6.3 million fewer Americans have jobs
than was true at the end of 2007. And yet the country's economic output
is higher today than it was before the financial crisis. Where did the
jobs go? Several factors, including outsourcing, help explain the state
of the labor market, but fast-advancing, IT-driven automation might be
playing the biggest role.
Since the beginning of the Industrial Revolution, people have
feared that new technologies would permanently erode employment. Over
and over again, these dislocations of labor have been temporary:
technologies that made some jobs obsolete eventually led to new kinds of
work, raising productivity and prosperity with no overall negative
effect on employment.
There's nothing to suggest that this dynamic no longer operates,
but new research is showing that advances in workplace automation are
being deployed at a faster pace than ever, making it more difficult for
workers to adapt and wreaking havoc on the middle class: the clerks,
accountants, and production-line workers whose tasks can increasingly be
mastered by software and robots. "Do I think we will have permanently
high unemployment as a consequence of technology? No," says Peter
Diamond, the MIT economist who won a 2010 Nobel Prize for his work on
market imperfections, including those that affect employment. "What's
different now is that the nature of jobs going away has changed.
Communication and computer abilities mean that the type of jobs affected
have moved up the income distribution."
Erik Brynjolfsson and Andrew McAfee study
information-supercharged workplaces and the innovations and
productivity advances they continually create. Now they have turned
their sights to how these IT-driven improvements affect employment. In
their new book, Brynjolfsson, director of the Center for Digital
Business at MIT's Sloan School of Management, and McAfee, its principal
research scientist, see a paradox in the first decade of the 2000s. Even
before the economic downturn caused U.S. unemployment to rise from 4.4
percent in May 2007 to 10.1 percent in October 2009, a disturbing trend
was visible. From 2000 to 2007, GDP and productivity rose faster than
they had in any decade since the 1960s, but employment growth was
comparatively tepid.
Brynjolfsson and McAfee posit that more work was being done by, or
with help from, machines. For example, Amazon.com reduced the need for
retail staffers; computerized kiosks in hotels and airports replaced
clerks; voice-recognition and speech systems replaced customer support
staff and operators; and businesses of all kinds took advantage of tools
such as enterprise resource planning software. "A classically trained
economist would say: 'This just means there's a big adjustment taking
place until we find the new equilibrium—the new stuff for people to
do,' " says McAfee.
We've certainly made such adjustments before. But whereas
agricultural advances played out over a century and electrification and
factory automation rolled out over decades, the power of some
information technologies is essentially doubling every two years or so
as a consequence of Moore's Law. It took some time for IT to fully
replace the paper-driven workflows in cubicles, management suites, and
retail stores. (In the 1980s and early 1990s productivity grew slowly,
and then it took off after 1996; some economists explained that IT was
finally being used effectively.) But now, Brynjolfsson and McAfee argue,
the efficiencies and automation opportunities made possible by IT are
advancing too fast for the labor market to keep up.
More evidence that technology has reduced the number of good jobs
can be found in a working paper by David Autor, an economist at MIT, and
David Dorn, an economist at the Center for Monetary and Financial
Studies in Madrid. They too point to the crucial years of 2000–2005. Job
growth happened mainly at the ends of the spectrum: in lower-paying
positions, in areas such as personal care, cleaning services, and
security, and in higher-end professional positions for technicians,
managers, and the like. For laborers, administrative assistants,
production workers, and sales representatives, the job market didn't
grow as fast—or even shrank. Subsequent research showed that things got
worse after 2007. During the recession, nearly all the nation's job
losses were in those middle categories—the positions easiest to replace,
fully or in part, by technology.
Brynjolfsson says the trends are "troubling." And they are global;
some of the jobs that IT threatens, for example, are at electronics
factories in China and transcription services in India. "This is not
about replacing all work, but rather about tectonic shifts that have
left millions much worse off and others much better off," he says. While
he doesn't believe the problem is permanent, that's of little solace to
the millions out of work now, and they may not be paid at their old
rates even when they do find new jobs. "Over the longer term, they will
develop new skills, or entrepreneurs will figure out ways of making use
of their skills, or wages will drop, or all three of those things will
happen," he says. "But in the short run, your old set of skills that
created a lot of value are not useful anymore."
This means there's a risk, unless the economy generates new
high-quality jobs, that the people in the middle will face the prospect
of menial jobs—whose wages will actually decline as more people compete
for them. "Theory says the labor market will 'clear.' There are always
things for people to do," Autor says. "But it doesn't say at what
price." And even as it gets crowded and potentially even less rewarding
at the bottom, employees at the top are getting paid more, thanks to the
multiplier effects of technology. Some 60 percent of the income growth
in the United States between 2002 and 2007 went to the top 1 percent of
Americans—the bulk of whom are executives whose companies are getting
richer by using IT to become more efficient, Brynjolfsson and McAfee
point out.
Dramatic shifts have happened before. In 1800, 90 percent of
Americans were employed in agriculture. The figure was down to 41
percent by 1900 and stands at 2 percent today. People work, instead, in
new industries that were unimaginable in the early 19th century. Such a
transformation could happen again. Today's information technologies,
even as they may do short-term harm to some kinds of employees, are
clearly a boon to entrepreneurs, who now have cheaper and more powerful
tools at their disposal than at any other time in history. As jobs are
lost, Brynjolfsson says, "we will be running an experiment on the
economy to see if entrepreneurs invent new ways to be productive equally
quickly." As examples, he points to eBay and Amazon Marketplace, which
together allow hundreds of thousands of people to make their living
hawking items to customers around the world.
The problem, he says, is that not enough people are sufficiently
educated or technologically savvy to exploit such rapid advances and
develop as-yet-unimagined entrepreneurial niches. He and McAfee conclude
their book by arguing that the same technologies now making industry
far more productive should be applied to updating and improving the
educational system. (In one promising example they cite, 58,000 people
went online to take an artificial-intelligence class offered by Stanford
University.)
IT-based entrepreneurship isn't the only potential technological driver of new jobs. Revitalizing manufacturing
(see "Can We Build Tomorrow's Breakthroughs?") could
also help. But automation has made manufacturing far less labor
intensive, so even a manufacturing revival is not likely to mean a great
many new jobs on balance. Likewise, anyone whose hopes are pinned on
"green jobs" may be disappointed. Though jobs will be created in the
switch to cleaner energy sources, jobs tied to traditional energy will
be lost in the same process. Many economists are not certain what the
net effect will be. And in any case, these days manufacturing and energy
account for small slices of the U.S. economy, which is now driven much
more by the service sector. That's why fast-advancing information
technologies, with their pervasive reach and their potential to create
new services and satisfy new niche markets, may be a better bet for job
creation—though the tumult IT is causing in the labor market isn't
necessarily going to resolve itself quickly.
Peter Diamond says that one of the most important things the
government can do for employment is to take care of basics, like
infrastructure and education. "As long as we have so many idle
resources, this is the time when it's advantageous—and socially less
expensive—to engage in public investment," he says. Eventually, he
believes, the economy will adapt and things will work out, once again.
"Jobs have been changing and moving around—within the country, out of
the country—for a very long time," he says. "There will be other kinds
of jobs that still require people."
David Talbot is TR
's chief correspondent.
“Mother Yashoda wanted to bind Krishna not in order to chastise Him but because she thought that the child was so restless that He might leave the house in fear. That would be another disturbance. Therefore, because of full affection, to stop Krishna from leaving the house, she wanted to bind Him with rope.” (Shrila Prabhupada, Shrimad Bhagavatam, 10.9.12)
The sweet, young mother, returning to the scene saw what her child had done. Though a youngster, Krishna was wise enough to know that He shouldn’t have done what He did. Therefore His act was certainly done on purpose. In addition, He fled the scene, as He was nowhere to be found. If He had broken the pot accidentally, there would have been no reason to leave. If He knew that what He did wasn’t wrong, why would He have left? In the end, His childish nature would trump His discrimination. Since He stepped in the butter, His footprints made while fleeing the scene gave away His location. Those sacred marks made of butter created the path that led to the cherished delight of 
There were other such miraculous events, which Mother Yashoda immortalized by describing them in song. It was while she was singing these songs that young Krishna approached her to be fed. Stopping her churning of butter, the kind mother cherished the vision of her son enjoying her company. Her brief stop in the kitchen was to prevent the milk from boiling over, but she knew that she would soon return to her son. What she didn’t expect was for Him to throw a tantrum and make Himself worthy of punishment.
In the same way that Yashoda bound Krishna to keep Him within her sight, the Supreme Lord binds the sincere 
