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September 26, 2015

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Jared Bernstein:
Back to the Future: While I'm wide open to evidence that I'm wrong, I've been skeptical of the claim that the robots are coming for our jobs. To be technical, the economics question is this: is the pace at which labor-saving technology is entering the workforce accelerating? ...
There are various pieces of evidence suggesting that the answer is "no." Most importantly, if the rate at which machines are replacing workers is increasing, then productivity growth—output/hours worked—should also be increasing. But it has been slowing.
One reason for slower productivity growth is diminished investment in capital goods—like machines—a trend that also doesn't square with the acceleration hypothesis. ...
So, what we have is largely anecdote and our own observation..., but ... when it comes to observations, humans are good at seeing first derivatives (rates of change) and less good at seeing second derivatives (changes in rates of change). We see that iPads and self-scanners are replacing waitpersons and cashiers but it's hard for us to tell whether "labor-saving technology" ...is coming more quickly than it has in the past.
Of course, this time might really be different (some smart people say it is).
Or, as this article ... reminded me (h/t: KN), this time might not be very different at all. It's about a new quinoa restaurant in San Francisco, called Eatsa, where you order and get your food without ever interacting with a person. ...
Now, where have I seen that before? Fifty years ago (!), I used to love to go to Manhattan automats, where ... a few coins would get you a sandwich, a veggie (not quinoa!), a slice of delicious pie, and so on. For the record, productivity growth was faster and unemployment was lower back then (though at 10, I don't recall knowing these facts at the time).
All's I'm saying is that tech change is always with us, and it's really hard to tell by observation whether the pace with which it's replacing workers is accelerating. And there are so many more moving parts to this. I'd bet a big difference between the economies in these two pictures is where the machines were manufactured. In other words, technology doesn't historically kill labor demand. But it does move it around to different industries, occupations, and today, countries.
So before we conclude we're all robot fodder, let's see it in the productivity and investment data. ...

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