Is Technology Destroying Jobs?
For all the benefits of living in a connected world, there is one huge disconnect: the economy seems to be growing, but it is not creating jobs. This disconnect is not a temporary blip that will disappear with a full economic recovery. It is part of a longer-term structural change in the economy.
Yesterday at the Techonomy conference, I moderated a debate (which you can watch above) between two economists, Erik Brynjolfsson of MIT?s Sloan business school and Tyler Cowen of George Mason University, about whether or not technology is the engine of the economy or whether, in fact, it is destroying jobs.
Many of us take for granted that technology is the brightest spot in the economy, where most of the innovation and job creation occurs. But if you look more broadly at the impact of technology across every industry, it doesn?t look so great. Technology makes businesses more efficient, often by eliminating the need for repetitive tasks and the workers who do them. We are not replacing those jobs with enough new, higher-skilled ones to make up for the loss.
So what we are seeing in the U.S. over the past decade is productivity growth without the job growth that usually comes with it. Traditionally, productivity growth and job growth went hand in hand, but that is no longer the case. Annual productivity growth in the U.S. between 2000 and 2009 was 2.5%, a faster rate than at any time since the 1960s. Yet the last decade saw the total number of jobs decline by 1.1 percent.
The official unemployment rate in the U.S. is 9.1 percent, with 13.9 million million out of work. Median wages in the U.S. have gone almost nowhere since the 1970s, which was the impetus for Cowen?s book, The Great Stagnation. Meanwhile, income disparity between the richest 1 percent and everyone else keeps growing. The other 99 percent is not too happy about that, as the #OccupyWallStreet movement illustrates.
Is the U.S. worker in the same position today as the workhorse was 100 years ago when it was replaced by another technology: the engine