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March 27 2017

Should We Worry About Robots Replacing Workers?

by Patrice L. Onwuka

Fast and fascinating technological developments are automating tasks from making your cup of coffee to driving you from your house to the airport. The big question is what impact technology will have on the American workforce – especially in light of other policies that make workers more expensive to hire.

In a recent interview the newly installed Treasury Secretary Steven Mnuchin pointed to the positive benefits of technology that make workers more productive. He suggests that displacement is a big issue we should be concerned about in the near future.

In an interview for Axios he commented:

“Technology has made the American worker more productive. In terms of artificial intelligence taking American jobs, I think we’re, like, so far away from that – not even on my radar screen,” Mnuchin said. “I think it’s 50 or 100 more years.”

When prodded further, Mnuchin said he based his assessment of automation based on what you think about artificial intelligence and the difference between a self-driving vehicle and a robot taking over as a areporter for example.

"So are you worried your job is going to be replaced by artificial intelligence?" Mnuchin joked.

"I mean, quite frankly, I’m optimistic. That’s what creates productivity. And what we need to do, we need to invest in training. We need to invest in education for the American worker," he said. "I think you’ve seen robotics have been an important part of business and have supplemented. And, if anything, what it’s done is taken jobs that are low-paying jobs."

As CNBC points to there has been a litany of research from the past few years that point to significant change ahead for Americans workers.

According to the Organization for Economic Cooperation and Development (OECD),  an estimated 9 percent of U.S. jobs are at risk of being completely displaced.  

The White House released a report in the waning days of the Obama administration on artificial intelligence, automation and the economy that noted both the benefits of productivity and the challenges of job losses:

American ingenuity has always been one of the Nation’s greatest resources, a key driver of economic growth, and a source of strategic advantage for the United States. Remarkable homegrown innovations have improved quality of life, created jobs, broadened understanding of the world, and helped Americans approach their full potential... AI in its many manifestations also holds promise to transform the basis of economic growth for countries across the world; a recent analysis of 12 developed economies (including the United States) found that AI has the potential to double annual economic growth rates in the countries analyzed by 2035.

An oft-cited Oxford study from 2013 found that 47 percent of American jobs are at risk of future computerization over the next decade or two:

Our model predicts that most workers in transportation and logistics occupations,

together with the bulk of office and administrative support workers, and labour in production occupations, are at risk. These findings are consistent with recent technological developments documented in the literature. More surprisingly, we find that a substantial share of employment in service occupations, where most US job growth has occurred over the past decades (Autor and Dorn, 2013), are highly susceptible to computerisation.

CNBC also notes:

The White House Council of Economic Advisors (CEA) ranked occupations by wages and found that 83 percent of jobs making less than $20 per hour would come under pressure from automation, as compared to 31 percent of jobs making between $20 and $40 per hour and 4 percent of jobs making above $40 per hour.

It may be that both Mnuchin and the reports are correct. Technology has the ability to make workers more productive and efficient such as lawyers, but it may replace some workers who do mundane tasks such as junior associates. For example, some mundane legal tasks could be done by technology such as reviewing hundreds of pages of documents for specific terms, which often get missed by humans. The benefits are increased efficiency and cost savings fro clients.

Whether we see fundamental changes in the next  5 years or 50 years is another question. Either way, policymakers must have it on their radars. Retooling workers for the jobs that will be around in the future will take a lift across every level government and agencies along with the education system and business community. Otherwise, we’ll continue to see opportunity and mobility slip further away from American workers while our society experiences the blessings and benefits of technology.

Independent Women’s Forum’s mission is to improve the lives of Americans by increasing the number of women who value free markets and personal liberty. Sister organization of Independent Women’s Voice.
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