Thursday, December 11, 2014

An automated workplace is closer than you think

I've been warning all year, in five articles on the subject, that many current jobs are on the verge of being automated out from under those who occupy them.  Now the Harvard Business Review points out that automation is a much more immediate threat to them than many workers imagine.

... we will soon be looking at hordes of citizens of zero economic value. Figuring out how to deal with the impacts of this development will be the greatest challenge facing free market economies in this century.

. . .

To be sure, technological progress has always displaced workers. But it also has created new opportunities for human employment, at an even a faster rate. This time, things may be very different – especially as the Internet of Things takes the human factor out of so many transactions and decisions. The “Second Economy” (the term used by economist Brian Arthur to describe the portion of the economy where computers transact business only with other computers) is upon us. It is, quite simply, the virtual economy, and one of its main byproducts is the replacement of workers with intelligent machines powered by sophisticated code. This booming Second Economy is brimming with optimistic entrepreneurs, and already spawning a new generation of billionaires. In fact, the booming Second Economy will probably drive much of the economic growth in the coming decades.

And here is the even more sobering news: Arthur speculates that in a little more than ten years, 2025, this Second Economy may be as large as the original “first” economy was in 1995 – about $7.6 trillion. If the Second Economy does achieve that rate of growth, it will be replacing the work of approximately 100 million workers. To put that number in perspective, the current total employed civilian labor force today is 146 million. A sizeable fraction of those replaced jobs will be made up by new ones in the Second Economy. But not all of them. Left behind may be as many as 40 million citizens of no economic value in the U.S alone. The dislocations will be profound.

Suppose, today, that the robots and smart machines of the Second Economy are only capable of doing the work of a person of average intelligence – that is, an IQ of 100. Imagine that the technology in those machines continues to improve at the current rate. Suppose further that this rate of technological progress raises the IQ of these machines by 1.5 points per year. By 2025 these machines will have an IQ greater than 90% of the U.S. population. That 15 point increase in IQ over ten years would put another 50 million jobs within reach of smart machines.

Impossible? In fact, the vanguard of those 115-point IQ machines is already here. In certain applications, the minds of highly educated MD’s are no longer needed.

. . .

Machine intelligence is already having a major effect on the value of work – and for major segments of the population, human value is now being set by the cost of equivalent machine intelligence.

. . .

Ultimately, we need a new, individualized, cultural, approach to the meaning of work and the purpose of life.

There's more at the link.  Crucial, essential reading for anyone employed today, or who hopes to be employed in the future.  Also, read the 'Second Economy' article cited in the text.  It's a seminal work.

This is a real conundrum.  Businesses are going to choose the lowest-cost options available to them in order to maximize their productivity and profit.  If that means paying a few tens of thousands up front for a robot or automated system, but then having no ongoing salary, training, medical care or other costs for it . . . the human worker's going to go to the wall.  Count on it.

Elon Musk, Steven Hawking and others are on record warning about the possible dangers of artificial intelligence systems to the human race.  They're thinking more in terms of machines taking over the running of the world, whether we like it or not.  I think a more immediate threat is that even in its current, extremely limited versions, artificial intelligence is already threatening our livelihoods.

If you are currently employed, ask yourself:  Can a machine do my job?  The answer may surprise you.  It's not just blue-collar jobs that are in danger:  increasingly, white-collar and intellectual work is facing the same threat.  I'd say that anywhere from half to two-thirds of the current workforce might be replaced by machines or software during the next ten to fifteen years.  If your job might be one of those facing automation, start reorienting your future right now, before the rush of newly unemployed people overwhelms you.  Look for re-training in new fields, and areas of employment where humans are unlikely to be replaced.  You need to be ahead of the ball on this one.  Time is not on your side.



Anonymous said...

Thanks for the update. One area where AI may not be able to replace humans is in the healthcare field - physical therapy or nursing. Yes, information can be related, but the physical presence of someone helping the afflicted - I'm not sure that can be done.

My present job is a CAD Architectural draftsman. I'm pretty sure it will likely be replaced by AI - many CAD programs such as Revit exist already which allows the architect (once they master the program) the ability to not require a draftsman anymore. Pity - I enjoy the work.

Thanks again.

Anonymous said...

I had a teacher in high school (35 years ago) who said that there would be 4 categories of jobs:

Designing computers and other machines
programming computers and other machines
Repairing computers and other machines

Pushing a broom around the computers and other machines.

He was right

housefitter said...

Actually, your high school teacher wasn't right, and that's what peter is getting at here. In 5 years, a computerized machine will be pushing the broom around the other machines. 10 years from now, they'll be doing the repair work. 15 years(or less)from now, they'll be programming the machines (actually, in some cam applications that already happens) and in 20 years (or less), computers will be designing new computers autonomously.
Where does that leave man? Hopefully the seed of man's fanciful thinking, such as anthropomorphic climate change doesn't find it's way into early programs. We'll be out completely if the software "believes" that.

housefitter said...

I should add the reasoning behind my comments: It has become a punishable offense in this country to hire a new employee. If the property tax on the machine is less than the 'bamacare, minimum wage and other benefits to a human, guess who get's the "2nd interview"?
Long run... where does it go? People need work to earn dollars to trade for products made by machines. Machines don't "buy products aside from replacement parts(made by other machines) and electricity.

Angus McThag said...

Mech CAD is long gone. Arch CAD hangs on because having minions strokes the ego of architects.

Or am I just cynical about being replaced?

jwontheriver said...

Sounds like it time to use my CDL Class A license?

Unknown said...

I don't think this will be as bad as it sounds, it is not a new issue. And we have been adapting to more efficient processes for several hundred years.

The Raving Prophet said...

Another problem: even those roles that machines cannot fill can become economically unviable as a career if others have lost their jobs. Call it secondhand unemployment... the machines may not have taken YOUR job, but enough jobs have been taken that there's not enough economic activity to cover your paycheck.

Take your own former career of ministry... there's no such thing as a computer that can do that work. But if all the church members are out of jobs and the giving can't pay your salary then you're still out of work.

Granted, as you point out, new careers will open up in maintaining or designing these machines (or in other lines of work we're not currently thinking about). That may replace much of the needed economic activity... but it may not.

Anonymous said...

Just gonna leave this here...

Unknown said...

Subsistence horticulture is looking better and better.

Or more and more inevitable, anyway.

Anonymous said...


Check the blog Chaos Manor for some of the discussions on the changing nature of work. Also, the book, The Next 100 Years discusses we are in a technological transformation. If you have every supervised people, you know how difficult they can be. And people are expensive. I work in manufacturing and we are looking at 3D printing and other new technologies to drive cost out. Competition is brutal and the only way to stay in business is to continuously cut costs, which really translates to less people time in your product.

But we are coming closer to going to the printer and having it print whatever you want. Almost like the Star Trek replicator.

The problem will become how do you reward the guy who has to go to school for 16 or 20 years to work on your replicator when its much easier to sit at home and watch TV? Our society will probably stratify even more than it is now around cultural lines where those who have a work ethic will have to do something. People are expensive but even if people decided to work for $1/hr sooner or latter the machines will still be cheaper.

We will need our morals more than ever at that point.

m4 said...

Perhaps we need to approach the problem a different way. The nature of the world will change, true. But should we be looking at this as a threat to our livelihoods - our jobs disappearing and there being no jobs for us to do... Or do we need to rebuild the system so that it's no longer necessary to work for a living?