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Don't Look at Technology as a Job Killer. It Makes Us More Productive

October 31, 2013, 3:36 PM

People have been worrying about men being displaced by machines for well more than a century.  This goes right back to the earliest times of the Industrial Revolution when you would have people smashing up machines in the belief that mechanization caused unemployment. 

And of course we know, thanks to the work of economic historians, that this is quite wrong. 

The displacement of labor from low productive sectors caused by mechanization in say, the textile industry is one that’s irreversible. Don’t try and stop that.  Ultimately, it raises the growth rate and increases the size of the proverbial cake. 

And so as we’ve seen the transformation of technology continue and as we’ve seen more and more human functions be transferred to machines, to robots, to computers, we haven’t all in fact grown poorer.  Some people lose their jobs and particularly if they’re relatively old, they don’t get back into the marketplace. They’re obsolete in the sense that their skills no longer really are worth paying a human to have. 

But if you take the world population as a whole and think of the world economy as a single thing, what’s actually happening is often simply we’re reallocating resources and job losses in one part of the economic system and those are more than compensated for by jobs created in other parts.  

In that sense, I’m a technological optimist.  I’m not going to be a neo-Luddite.  Milton Freidman, the great Chicago Economist, had a splendid story about this.  He was in China - Mao’s China - and he came to see some great job creation scheme in which a great many people were digging an enormous canal, a giant ditch, with shovels.  And Friedman looked at this, seeing no sign of any mechanized diggers.  And he said, “Well, why are you doing this manually?”  And his host replied, “Well, it creates so many jobs to do it this way, look how many people we’re employing here.”  And Friedman said, “Well, if that’s your aim, you should equip them with spoons not with shovels because then you could employ even more people, and it would take even longer.” 

We must not fear technology that enhances productivity.  We’re all, in fact, beneficiaries of it.  I spend so much of my time these days making use of my laptop, my computer, and doing things as an historian that I could not do 20 years ago - managing vast quantities of documentation that when I started out as a PhD in history, would have filled my room and more with photocopied pages. 

I cannot only access this data more readily; I can search it in ways that were inconceivable before.  My productivity as a historian has been massively increased by the technology that has been produced in the information sector.  And it’s fantastic.  And I don’t think I’ve made anybody unemployed.  I don’t think there are starving historians who would otherwise be in work if I were just a little less productive. 

On the contrary, I suspect I’ve probably created a good deal more employment of research assistants and publishing executives by the fact that I write more books than I could ever have done 20 years ago.  

In Their Own Words is recorded in Big Think's studio.

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