Automation and the invisible hand

Posted: 19 August 2016 in Uncategorized
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We all know that some large portion of workers and their jobs are threatened—now and in the future—by new technologies. That’s why I’ve been increasingly writing about the conditions and consequences of robots and automation.

According to McKinsey, “currently demonstrated technologies could automate 45 percent of the activities people are paid to perform and that about 60 percent of all occupations could see 30 percent or more of their constituent activities automated, again with technologies available today.” In their view, it’s not so much that whole occupations will be eliminated in the foreseeable future, but that automation will affect a great many jobs and activities within those jobs.

It means, under existing economic arrangements, automation will occur where it is technically feasible and financially profitable—and, where it does occur, workers will increasingly become appendages of machines.

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The prime candidate for automation is what the authors of the report refer to as “predictable physical work,” that is, performing physical activities or operating machinery in a predictable environment. This includes many manufacturing activities but, as it turns out, it’s also true in the service sector. In fact, according to McKinsey, the most readily automatable sector in the U.S. economy is “accommodations and food service.”

But that’s only on technical grounds. Since the prevailing wage in that sector is very low, many of the workers’ activities may not in fact be automated based on cost considerations. In that case, it’s the threat of automation that will most affect workers and their jobs.

But there are many other activities and sectors that might be automated with the existing technologies (including software). These include manufacturing (where “performing physical activities or operating machinery in a predictable environment represents one-third of the workers’ overall time”), retailing (including “packaging objects for shipping and stocking merchandise” as well as “maintaining records of sales, gathering customer or product information, and other data-collection activities”), financial service and insurance (in which “50 percent of the overall time of the workforce. . .is devoted to collecting and processing data, where the technical potential for automation is high”), and so on.

And the two with the lowest technical feasibility for automation? Healthcare and education. But, even in those sectors, a large number of activities is susceptible to being automated—from food preparation to data collection—at least on technical grounds.

So, what’s going to happen with workers and their jobs as automation moves forward (and as new technologies, such as machine learning, are imagined and devised)?

From what we know about the past, the actual history of technology and capitalism, new forms of automaton will be invented and made technically feasible where their production is financially profitable, and they will become profitable when it’s possible for one enterprise to use automation to outcompete other enterprises (based on a wide range of factors, from lowering production costs to improving the quality of output) in order to secure higher profits.

And, as in the past, the effects on workers will simply be ignored by their employers. Some of their employees will lose their jobs (as they are replaced by robots and digital technologies); for others, their jobs will be fundamentally transformed (e.g., as their work is surveilled by machines and as they become appendages of the automated processes and technologies). Blue-collar workers already know this. White-collar workers are quickly discovering how and why it might happen to them. In both cases, a changing combination of actual automation and the threat of automation is making their work and their livelihoods less and less secure.

But, according to Steven Pearlstein, workers have no need to worry. The invisible hand will take care of them.

The winners from job-destroying technology hire more gardeners, housekeepers and day-care workers. They take more vacations and eat at more restaurants. They buy more cars and boats and bigger houses. They engage the services of more auto mechanics and personal trainers, psychologists and orthopedic surgeons.

Sure, Pearlstein admits, it may take “years, even decades” for the necessary adjustments to occur. But “People who lose their jobs must have the willingness and wherewithal to find new opportunities, learn new skills, move to new cities.”

Whether or not workers take it upon themselves to adjust to the “creative destruction” Pearlstein and mainstream economists celebrate, it is still the case that the decisions about automation will be taken by their employers, not workers themselves. And the benefits, as always, will be appropriated by the small group at the top, not the mass of employees at the bottom.

Perhaps the only hope for workers—until they are able to change the existing economic institutions—is to imagine a process whereby the tasks their employers currently assign to themselves and their managers will become automated. As a result, those who direct the enterprises will also become superfluous.

Pie in the sky, perhaps. But it’s an invisible hand no less utopian than the one Pearlstein and mainstream economists currently believe in.

Comments
  1. antonio callari says:

    Both Marx and Keynes spoke of a time coming when the “economic” problem had been “solved,” Marx having people fishing in the a.m. and writing poetry in the p.m., and Keynes thinking of his grandchildren. In both cases,”‘work” would not be the gateway to survival; it would go back to the making things it used to be (except that, now, it could be according to ability and creativity). i wonder if this automation stuff may not be getting us there. We only need to sweep away habits and interests stuck in the work and money modes–and, this, of course, not just in the west (where we are beginning to see some guaranteed income moves), but all over the globe!

    • David F. Ruccio says:

      You’re absolutely right, Antonio. The argument I’ve made a number of times (as you can see here) is that the problem is not technology per se, but the particularly capitalist use of technology. Under different conditions, with different “relations of production,” new automated technologies would have very different causes and consequences.

  2. mjlovas says:

    There is also pressure for so-called consumers of services to conform to a barren and ruthless sort of standardization. You must order from a menu of choices provided by the company. And your language must conform to their top-down generated menu. This is especially clear in an establishment like Starbuck’s, despite their ability to increase “freedom” and “choice” via the multiplication narrow categories of beverage. I believe that the category “small”, for example, doesn’t exist at Starbucks. (Though I’ve not had the pleasure to visit such an establishment recently….)

    I understand very well that people performing these jobs are often under pressure to increase output, and sometimes there are too many customers; however, the insidious limitation to speech is present at all times…..So, in the workplace, you are measured and weighed, and assigned to a box where creativity is not tolerated, and once you joyously flee your workplace, seeking pleasure in spending and consuming, you are once again assailed by the same lovely forces of conformity and anti-creativity. Yes, it is really a sort of hell……

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