On the House floor last month, Rep. Jesse Jackson Jr. told us who and what to blame for millions of unemployed Americans: Steve Jobs; the iPad.
Borders went bankrupt and closed bookstores, in part because of pressure from competitors like the Apple iBookstore on the iPad. “What becomes of publishing companies and publishing company jobs?” said Jackson. “What becomes of bookstores and librarians and all of the jobs associated with paper?”
The online reaction was immediate and dismissive. “And what about the buggy whip jobs! And the ice cube delivery man!” wrote one commenter. Technological advances will create new, more valuable jobs, people argued.
Though Jackson’s premise invites mockery, it contains a grain of unwelcome truth. Quite apart from flying cars and robot dogs, the future holds a bleak outlook for the American worker.
Every year, productivity, a measure of individual performance, ticks upward. Last year, it rose 3.9 percent, according to the Bureau of Labor Statistics. The prime driver behind the gain is technology. It seems positive for American workers; we’re 3.9 percent more effective than we were in 2009. But, put it another way, and workers are also 3.9 percent more superfluous. Our jobs could be done by fewer workers or in less time, and that saves the employer money.
The twin threats of illegal immigrants and outsourcing have received a lot of ink. In those cases, employers hire cheaper workers here in the U.S. or abroad. Technological replacement can have the same effect, though in the long run, computers are even cheaper. Forget $8 or $15 an hour. Try $0.57 for a Chinese factory worker or $0.12 for a computer. We have priced ourselves out of the labor market.
There will be new jobs created by technology, but there’s no guarantee that they will make up the loss. It takes a couple hundred engineers in California to design an iPad, which is manufactured in China. It will destroy thousands of jobs. And the jobs it does create will go to people with different skill sets than those being laid off.
This isn’t new: cities like Detroit, Rochester and Pittsburgh were devastated by the decline in manufacturing. Populations declined after automakers, photo giants and steel mills shuttered factories. Though there’s some recovery, they show the heavy toll of the collapse, and the road they’ve since built is paved on industries ripe for a dose of technological efficiency.
Two growing industries prove the point. Education is booming, but it is stunningly inefficient. There is no reason to employ teachers for every classroom in America, not when the same classes can be delivered online. Health care has benefitted from a glut, but it could be made massively more efficient by wall-to-wall computerization — the RAND Corporation estimates $77 billion could be saved from reduction of tests, hospitalization and paperwork. Excellent news for health care consumers, just as better ways to deliver education are good news for students. But when we’re all healthy, and we’re all educated, where do we work?
We used to think it was a given that we would work to design or manage the technology that would replace us. But outsourcing means that somebody in China or India could. Clearly, too, not everybody is cut out for high-tech jobs. Only 71 percent of students graduate from high school on time, let alone get a college degree. And those degrees have gotten far more expensive.
We’ve been cushioning the inevitable reckoning with mountains of debt and plenty of denial. Governments, from federal to local, have sunk massive quantities of money to prop up the now 20 percent of our economic output they are responsible for. Individuals and households have sunk mountains more into paying for necessities.
They take out student loans, new credit cards, and second mortgages to pay for education, health care, even the rent. They’re thought to be irresponsible, but in truth, that kind of artificial boost in living standards has become the norm. The average U.S. household holds about $7,500 in credit card debt. No wonder the financial sector was the driver of growth, and no wonder it collapsed.
Since the 1950s, the U.S. economy has been one long party. Sure, there were downturns and recessions, but it was a question of when it would all get going again, not whether it would. Today, it looks like the party is over. Let’s hope the computers and foreign workers will clean up and turn off the lights.
The opinions expressed are solely those of the author and do not reflect the views of Reporter.