by Tim Worstall
Various people seem to get something of the wrong end of the stick over what happens when the robots come to steal all our jobs. It simply is not true that when we automate a process then the automation itself produces as many jobs as we’ve just destroyed through the process of automation. It just isn’t true that all those blacksmiths went off and became car mechanics when we stopped riding horses. If that’s what did happen then we wouldn’t become richer through that process of automation. What does actually happen is that when we automate one process or another then people are freed up to go off and do something else. And as we’ve, at least so far, not run out of other things to do there is no problem with this.
But it is still important to get this anti-Luddite argument correct. Which, sadly, it isn’t here:
I guess that’s the same thing blacksmiths said about cars when they were adopted by the public in 1908. It turns out, however, that for every blacksmith that did lose his horseshoe-making job, a new workplace was opened for a mechanic and his apprentices.
No, that’s not how it works, not how it works at all.
Let’s apply that logic to robots: Instead of assembling toys or furniture, or working the conveyor belt, people will be given an opportunity to find work in manufacturing and keep these robots in working order. These new jobs will require additional skills and education, but will also yield higher wages, resulting in better quality of life for budding robot technicians and engineers. Let’s not forget coders and designers who will make these helpers look good, in addition to being smart and efficient. Finally, the consumer — the robot owner — will also work less and achieve more by focusing on what really matters, while leaving simple, boring and time-consuming tasks to robots.
Take a not very accurate but not imaginary either look at about 1880. Agriculture is still largely driven by human and animal power. There’s the occasional steam driven threshing machine but that’s about it. Some 40% of the population work in the fields. Fast forward 100 years and about 2% of the population work in the fields. The tractor, the combine, we’ve automated farming. So, did those 38% of the people all go off and make tractors and combines? No, obviously, they didn’t. And if they had we wouldn’t be any richer now either. For look at it this way if they did. In 1880 we would have had 40% of the population producing the food for 100% of us. And then in 1980 we would still have had 40% of the population producing food for the 100% of us. And that’s not made us any richer. It doesn’t matter whether it’s 40% of the people in the fields or 2% there and 38% in the combine factories: it’s still 40% of all human labour being used to grow food.
And yet we know that we did become very much richer over this time period. And the reason for that is that we had (entirely made up number) perhaps 1% of the people in the combine factories, 2% on the land. Which meant that the other 37% of the population could go and do something else. Be ballet dancers, stock libraries, nurse the sick. And that’s how automation makes us richer: we get richer by the amount of more ballet, nursing and libraries we get as a result of freeing up the labour by automating some field of work.
It is, as I say, vital to understand this about automation. The robots do not create new jobs themselves. They free us humans to go do things that were not being done before and that is why automation makes us richer, because now those things that were not being done are being done and we’re richer by whatever value we put on having them done.