After visiting a couple of our biggest industries in recent months and considering the narrative our economic development experts have been establishing for the past couple of years, I am beginning to think maybe, just maybe, the Luddites had a point after all.
For those unfamiliar with the term, Luddites was the name given to English textile workers in the early 19th Century who smashed the newly-developed power looms because they feared the new technology would make workers obsolete.
The idea that technology could be a threat to jobs has been around as long a technology itself. For the past 200 years, those fears have proven to be largely unfounded. While technology did replace some jobs, it also created the need for workers to perform other tasks. It created wealth, which lead to more jobs. Indeed, productivity and employment proved to follow parallel paths.
As I toured part of the Weyerhaeuser facility about a month ago, I was amazed to see just how far technology has advanced. First, I was struck by how few people it seemed to take to run an operation of such a massive scale. Second, it seemed as though every worker’s job involved watching monitors and making whatever adjustments needed to be made on a keyboard.
How accurate these impressions were, I cannot say. All of the technology in my house blinks “12:00,” so there may be far more than meets the eye when it comes to how Weyerhaeuser actually operates.
Last week, I attended a ceremony at Steel Dynamics, which announced a $100 million expansion that involves building a paint facility to allow the company to broaden its customer base to reach, among others, appliance manufacturers.
The expansion will add 40 jobs, but all of them will be high-paying jobs, as much as $80,000 per year.
Those 40 workers won’t be standing in the new paint booth with a sprayer. They’ll be sitting in a control room, where they can mange the machines that will do the painting.
Today’s factory workers are no longer laborers; they are analysts. And they are paid very, very well for their expertise.
That shouldn’t have been a surprise, really. For the past couple of years, economic development and workforce development officials have been telling us that the demand for highly-skilled workers for our industries is far greater than supply. In a region where roughly 1 out of 10 people are unemployed, there is a manpower shortage. To address this problem, the Golden Triangle Regional Development LINK, East Mississippi Community College and the state have collaborated to build a $38 million workforce training center near the EMCC campus in Mayhew. In addition, these officials are urging would-be workers to take the WorkKeys Test, which is the equivalent of the ACT for those who want to land those high-paying factory jobs.
At some point, the shortage of skilled workers will be filled.
Then what?
That’s where the Luddites come in.
MIT professor Eric Brynjolfsson says that for the first time in history technology – in the form of robotics, software or algorithms – is replacing workers faster than it creates them.
When new technology arrives, one worker transitions to another more skilled job, but two others pick up their last paycheck at the office.
To verify his claims, Brynjolfsson has studied the relationship between productivity and employment going back to the post-World War II manufacturing boom. For years, the two lines closely tracked each other, with increases in jobs corresponding to increases in productivity. The pattern is clear: as businesses generated more value from their workers, the country as a whole became richer, which fueled more economic activity and created even more jobs. Then, beginning in 2000, the lines diverge; productivity continues to rise robustly, but employment suddenly wilts. By 2011, a significant gap appears between the two lines, showing economic growth with no parallel increase in job creation.
The MIT professor is not alone, either. Former U.S. Treasury Secretary Larry Summers notes that it the 1960s, only one in 20 men between 25 and 54 was not working. According to Summers, by 2025 the number could be one in seven – and it has nothing to do with “laziness,” as some would have you believe.
Technological advances will threaten other types of jobs, too.
A 2013 study by Carl Benedikt Frey and Michael Osborne of Oxford University indicates nearly half of U.S. jobs could be at risk of computerization over the next 20 years. The study showed that jobs in transportation, logistics, offices and administration are particular vulnerable to the wave of highly-advanced, intuitive technology.
Could it be that we are innovating ourselves into a world where the already disturbing employment/income gap reaches a critical mass? If so, the societal implications are ominous.
At some point, some form of equilibrium would have to be reached.
Again, we turn to history and are reminded of an exchange involving Henry Ford II, the son of the founder of Ford Motor Company.
It is said that Ford once showed Walter Reuther, the leader of the United Automobile Workers, around a new automated car plant. “Walter, how are you going to get those robots to pay your union dues?” said Ford. Reuther quickly replied, “Henry, how are you going to get them to buy your cars?”
In the short term, it seems inevitable that tomorrow’s workers, whether they go to an office or a factory, will be highly-paid and highly-skilled.
That’s great news only if you are among the shrinking number of people who have one of those jobs.
Maybe the Luddites were right, after all.
Slim Smith is a columnist and feature writer for The Dispatch. His email address is [email protected].
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