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Not everyone agrees with Brynjolfsson and McAfee’s conclusions—particularly the contention that the impact of recent technological change could be different from anything seen before. But it’s hard to ignore their warning that technology is widening the income gap between the tech-savvy and everyone else. And even if the economy is only going through a transition similar to those it’s endured before, it is an extremely painful one for many workers, and that will have to be addressed somehow. Harvard’s Katz has shown that the United States prospered in the early 1900s in part because secondary education became accessible to many people at a time when employment in agriculture was drying up. The result, at least through the 1980s, was an increase in educated workers who found jobs in the industrial sectors, boosting incomes and reducing inequality. Katz’s lesson: painful long-term consequences for the labor force do not follow inevitably from technological changes.
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Techniques using vast amounts of computational power have gone a long way toward helping robots understand their surroundings, but John Leonard, a professor of engineering at MIT and a member of its Computer Science and Artificial Intelligence Laboratory (CSAIL), says many familiar difficulties remain. “Part of me sees accelerating progress; the other part of me sees the same old problems,” he says. “I see how hard it is to do anything with robots. The big challenge is uncertainty.” In other words, people are still far better at dealing with changes in their environment and reacting to unexpected events.
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But something else happened in the global economy right around 2000 as well: China entered the World Trade Organization and massively ramped up production. And it was this, not automation, that really devastated American manufacturing. A recent paper by the economists Daron Acemoglu and Pascual Restrepo—titled, fittingly, “Robots and Jobs”—got a lot of attention for its claim that industrial automation has been responsible for the loss of up to 670,000 jobs since 1990. But just in the period between 1999 and 2011, trade with China was responsible for the loss of 2.4 million jobs: almost four times as many. “If you want to know what happened to manufacturing after 2000, the answer is very clearly not automation, it’s China,” Dean Baker says. “We’ve been running massive trade deficits, driven mainly by manufacturing, and we’ve seen a precipitous plunge in the number of manufacturing jobs. To say those two things aren’t correlated is nuts.” (In other words, Donald Trump isn’t entirely wrong about what’s happened to American factory jobs.)
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One of the friendlier, more flexible robots meant to work with humans is Rethink’s Baxter. The creation of Rodney Brooks, the company’s founder, Baxter needs minimal training to perform simple tasks like picking up objects and moving them to a box. It’s meant for use in relatively small manufacturing facilities where conventional industrial robots would cost too much and pose too much danger to workers. The idea, says Brooks, is to have the robots take care of dull, repetitive jobs that no one wants to do.
None of this is to say that automation and AI aren’t having an important impact on the economy. But that impact is far more nuanced and limited than the doomsday forecasts suggest. A rigorous study of the impact of robots in manufacturing, agriculture, and utilities across 17 countries, for instance, found that robots did reduce the hours of lower-skilled workers—but they didn’t decrease the total hours worked by humans, and they actually boosted wages. In other words, automation may affect the kind of work humans do, but at the moment, it’s hard to see that it’s leading to a world without work. McAfee, in fact, says of his earlier public statements, “If I had to do it over again, I would put more emphasis on the way technology leads to structural changes in the economy, and less on jobs, jobs, jobs. The central phenomenon is not net job loss. It’s the shift in the kinds of jobs that are available.”
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Perhaps the most damning piece of evidence, according to Brynjolfsson, is a chart that only an economist could love. In economics, productivity—the amount of economic value created for a given unit of input, such as an hour of labor—is a crucial indicator of growth and wealth creation. It is a measure of progress. On the chart Brynjolfsson likes to show, separate lines represent productivity and total employment in the United States. For years after World War II, 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. Brynjolfsson and McAfee call it the “great decoupling.” And Brynjolfsson says he is confident that technology is behind both the healthy growth in productivity and the weak growth in jobs.
The talking bot can supposedly identify joy, sadness, anger, and surprise and determine whether a person is in a good or bad mood—abilities that Pepper’s engineers figured would make “him” an ideal personal assistant or salesperson. And sure enough, there are more than 10,000 Peppers now at work in SoftBank stores, Pizza Huts, cruise ships, homes, and elsewhere.
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Given his calm and reasoned academic demeanor, it is easy to miss just how provocative Erik Brynjolfsson’s contention really is. Brynjolfsson, a professor at the MIT Sloan School of Management, and his collaborator and coauthor Andrew McAfee have been arguing for the last year and a half that impressive advances in computer technology—from improved industrial robotics to automated translation services—are largely behind the sluggish employment growth of the last 10 to 15 years. Even more ominous for workers, the MIT academics foresee dismal prospects for many types of jobs as these powerful new technologies are increasingly adopted not only in manufacturing, clerical, and retail work but in professions such as law, financial services, education, and medicine.
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It is this onslaught of digital processes, says Arthur, that primarily explains how productivity has grown without a significant increase in human labor. And, he says, “digital versions of human intelligence” are increasingly replacing even those jobs once thought to require people. “It will change every profession in ways we have barely seen yet,” he warns.
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Despite the labor-saving potential of the robots, Mick Mountz, Kiva’s founder and CEO, says he doubts the machines have put many people out of work or will do so in the future. For one thing, he says, most of Kiva’s customers are e-commerce retailers, some of them growing so rapidly they can’t hire people fast enough. By making distribution operations cheaper and more efficient, the robotic technology has helped many of these retailers survive and even expand. Before founding Kiva, Mountz worked at Webvan, an online grocery delivery company that was one of the 1990s dot-com era’s most infamous flameouts. He likes to show the numbers demonstrating that Webvan was doomed from the start; a $100 order cost the company $120 to ship. Mountz’s point is clear: something as mundane as the cost of materials handling can consign a new business to an early death. Automation can solve that problem.
Brynjolfsson and McAfee are not Luddites. Indeed, they are sometimes accused of being too optimistic about the extent and speed of recent digital advances. Brynjolfsson says they began writing Race Against the Machine, the 2011 book in which they laid out much of their argument, because they wanted to explain the economic benefits of these new technologies (Brynjolfsson spent much of the 1990s sniffing out evidence that information technology was boosting rates of productivity). But it became clear to them that the same technologies making many jobs safer, easier, and more productive were also reducing the demand for many types of human workers.
To be sure, Autor says, computer technologies are changing the types of jobs available, and those changes “are not always for the good.” At least since the 1980s, he says, computers have increasingly taken over such tasks as bookkeeping, clerical work, and repetitive production jobs in manufacturing—all of which typically provided middle-class pay. At the same time, higher-paying jobs requiring creativity and problem-solving skills, often aided by computers, have proliferated. So have low-skill jobs: demand has increased for restaurant workers, janitors, home health aides, and others doing service work that is nearly impossible to automate. The result, says Autor, has been a “polarization” of the workforce and a “hollowing out” of the middle class—something that has been happening in numerous industrialized countries for the last several decades. But “that is very different from saying technology is affecting the total number of jobs,” he adds. “Jobs can change a lot without there being huge changes in employment rates.”
The machines created at Kiva and Rethink have been cleverly designed and built to work with people, taking over the tasks that the humans often don’t want to do or aren’t especially good at. They are specifically designed to enhance these workers’ productivity. And it’s hard to see how even these increasingly sophisticated robots will replace humans in most manufacturing and industrial jobs anytime soon. But clerical and some professional jobs could be more vulnerable. That’s because the marriage of artificial intelligence and big data is beginning to give machines a more humanlike ability to reason and to solve many new types of problems.
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Meanwhile, Kiva itself is hiring. Orange balloons—the same color as the robots—hover over multiple cubicles in its sprawling office, signaling that the occupants arrived within the last month. Most of these new employees are software engineers: while the robots are the company’s poster boys, its lesser-known innovations lie in the complex algorithms that guide the robots’ movements and determine where in the warehouse products are stored. These algorithms help make the system adaptable. It can learn, for example, that a certain product is seldom ordered, so it should be stored in a remote area.
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