Artificial intelligence is transforming the workplace more profoundly than the industrial revolution did – and far more intensely. Where the industrial revolution unfolded over the better part of a century, every year now is now a revolution.
Few professions are unaffected. Just as mechanization reduced the need for manpower, first in agriculture and then in heavy industry, so computers are doing the same to white collar jobs. Why go to the doctor when you can wear a device that senses your basic functions – blood pressure, insulin levels, and so on – and offers diagnosis without human error? Why get a lawyer to look over your contract when an algorithm can do it cheaply and flawlessly?
So, what about the people who get left behind? What of those who can’t constantly reinvent themselves, who can’t keep acquiring new skills as technology advances?
Every year, an extraordinary 13 percent of jobs are made redundant by advances in IT. Politicians and journalists remain weirdly fixated on the closure of the few remaining coal mines, shipyards, and steel mills, but many more jobs are disappearing in the services sector. What has happened to all the video rental employees? Or to the travel agents, or the secretaries, or the archivists, or the newspaper reporters? Turnover in services is far higher than in the remaining manufacturing jobs, though it receives nothing like the same attention.
And yet, as President Trump keeps boasting, unemployment is low and falling. The absolute number of Americans with jobs has risen every month for the last seven years. Plainly, many more jobs are being created than are being lost, though you would not guess it from the headlines. So how is that?
We worry about the adaptability of manual workers – and by “we”, I suppose I mean the generally better-heeled and better-schooled people who read political columns. There is a snobbish edge to some of the commentary. A college graduate, we assume, can cope with rapid technological change. We’re much more worried about the guy who welds steel for a living.
But in fact, both are likely to find their skills redundant in exactly the same way. Today’s kids probably won’t have jobs at all in the sense that we understood that word in the 20th century. Their professional lives will involve constant movement, bursts of freelancing interlaced with retraining. Yet, they will live far better lives than we do, benefiting from the general rise in productivity.
That’s the real story of the last 300 years. Without getting any smarter, we have become immensely richer. Why? Because our networks of exchange have grown and our collective mountain of knowledge has been heaped higher. All of us benefit, regardless of whether we understand the technology.
Think of anyone in a relatively low-paid job – a barmaid, say. Her own productivity has barely risen since Shakespeare’s time. Sure, there may now be a washing machine for the glasses, but the essential job of today’s barmaid is not so different from that of a tavern wench in Henry IV, Part One: to ask people what they want to drink and pour it out.
But while her productivity has flatlined over the past four centuries, her standard of living has soared. She doesn’t need to worry about the pox or the plague. She is unlikely to die in childbirth. She is taller, having not suffered from episodes of hunger and malnutrition.
Today, she carries about a little screen that brings her more information than the entire human race could muster in Shakespeare’s time. If she feels like it, she can read or even watch all of Shakespeare’s plays on that screen. And if she finds their language archaic, she can look up all the meanings because, unlike a Jacobean barmaid, she can read.
And she can read, incidentally, not because teachers have become cleverer. They, too, are doing pretty much what they did in Shakespeare’s day, namely standing in front of a class and talking. But education is now near-universal, as a result of that same increase in everyone else’s productivity that has improved the barmaid’s living standards.
That’s the wonderful, if counterintuitive, thing about specialization and exchange. As David Ricardo showed 200 years ago, we get wealthier, not just when we improve our own productivity, but when the people we trade with increase theirs.
In fact, the further they pull ahead of us, the more they incidentally enrich us. That’s why, in a growing economy, quality of life rises across the board – not uniformly, but steadily. That’s why someone on welfare today lives better than a worker did on average wages between the wars. Capitalism: It works its magic on you, whether you believe in it or not.
Daniel Hannan, a Washington Examiner columnist, is a British member of the European Parliament.