Saturday, November 27

Automation can be our friend, but we must not let it become an enemy | Robert Skidelsky

What economic historian Aaron Benanav calls the “automation discourse” has been going on since the Luddites smashed textile machinery in Nottingham in 1811.

The question is whether machines destroy or create jobs. The first case is the easiest to understand. Machines save labor; and saved work means unemployed work. The fear of unemployment has always been the dominant response of the workforce to the introduction of machinery.

The second case involves taking into account the repercussions. The cheaper it is to produce something, the more demand there will be. This means that more workers can be employed.

It can then be seen how the extension of mechanization to all branches of industry can multiply the favorable effects: more employed persons produce more and varied goods with higher wages for a reduced effort. The fear of unemployment, economists say, is really a displaced fear of leisure.

With computer technology, not only physical work, but also so-called “cognitive” work can be automated. Modern Luddites foresee the growth of white-collar unemployment and the service sector. Once again, optimists say, they fail to see the advantage. The economic argument is simple: “Higher productivity implies faster economic growth, more consumer spending, higher labor demand, and therefore more job creation,” argued Sir Christopher Pissarides and Jacques Bughin in their paper. 2018.

The problem is social: ensuring that the fruits of higher productivity are transmitted to the mass of the population in the form of higher wages and non-labor income. The political debate is about how much public intervention is needed to ensure that the wealth created by machines reaches all sectors of the population.

The interesting question right now is: what effect will blocking Covid-19 have on this automation discourse? It is worth highlighting three effects in particular. The first is the probable acceleration of automation; the second, the increase in automatic purchases; and the third, the growth of home work.

Despite all the hype, automation made little headway in the UK before the pandemic. According to the International Federation of Robotics In 2018, the UK had just 71 robots for every 10,000 workers. I think the main reason was that cheap labor from abroad was an alternative to automation, especially for small and medium-sized companies that could not afford the capital cost of installing machinery.

However, this supply has been depleted and will not be restored quickly. We now have the paradoxical combination of a almost record adult employment rate along with the highest job vacancy count ever.

Covid-19 will almost certainly accelerate automation in line with the experience of past pandemics like Sars in 2003, with the driving forces being the economic downturn and the need to reduce labor costs, and the increased perceived risk of human contact. Jobs with higher levels of physical proximity, such as retail, hospitality, entertainment and healthcare, are the most likely to be automated after a pandemic.

Unless the government steps in to subsidize investment (say, through a national investment bank), financing for automation will be achieved through increased industry concentration in large companies and the bankruptcy of many small and medium-sized companies.

The second source of automation will come from the consumer shift to remote purchasing. This is the joint result of a change in habits forced by confinement and fear of contamination. One symptom is the increase in cashless stores. The first Amazon Fresh convenience store – with automated sensors to detect when items are being taken off the shelves and automatically charging customers – opened in London in March, promising a more “frictionless” consumer experience. Many more are promised.

Finally, the rise of home work will require greater use of surveillance technology. The proportion of adults working from home grew from 27% in 2019 to 37% last year on average, with Londoners being the most likely to work remotely. Companies see a clear increase in productivity in the reduction of time spent traveling and chatting in offices.

However, realizing such gains requires an investment in surveillance technology. A recent report in the Financial times He highlighted the growth of electronic techniques to monitor home work, including the installation of cameras and microphones in every home. This broadens the discussion on the impact of technology not only on employment, but also on freedom. When Jeremy Bentham invented his panopticon to monitor the movement of prisoners, he suggested that it could be fruitfully applied in schools and hospitals. George Orwell carried this thought to its logical conclusion in his futuristic novel. Nineteen Eighty-four. A two-way television screen in each apartment ensured that “Big Brother is watching you” all the time.

So, on which side of the optimism-pessimism divide does the automation discourse now fall? Automation is not good in itself; it’s just a means to an end. We must always keep in mind the question of the purposes for which it is designed.

Unless this question is continually asked and answered with actions, we are destined to become slaves to machines and those who control them. The Luddites understood this.

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