Money & Company

Tracking the market and economic trends
that shape your finances.

« Previous Post | Money & Company Home | Next Post »

Robots are creating jobless recovery, UCLA says

December 7, 2010 | 10:29 am

Robot The state's economy may begin to pick up next year, according to a forecast released Tuesday by the UCLA Anderson School of Business. But nationally, there are still millions of people whose skills are no longer needed and will have trouble finding work, according to a segment of the forecast written by Edward Leamer, director of the UCLA Anderson Forecast.

"Displaced workers are likely to have a difficult time finding jobs elsewhere partly because the jobs will remain scarce and partly because of a mismatch between the skills and abilities offered and the skills and abilities needed," he wrote.

The analysis comes as Congress debates provisions that would extend unemployment benefits for millions of Americans, including the long-term unemployed, who have been without work for six months or longer.

One of the reasons for the mismatch, Leamer argues, is that robots have filled positions in manufacturing that in past recessions would have been filled by humans (an issue covered by The Times in October). Jobs that robots can't do, Leamer says, are being done overseas.

This recession should serve as a wake-up call to American workers, Leamer says:

If you have nothing to offer the job market that cannot be supplied better and cheaper by Robots, Far-away Foreigners, Recent Immigrants or Microprocessors, expect it to be exceedingly difficult to find the job to which you aspire, and plan on doing low-wage service work at the end of a long and painful road of diminished aspirations, no matter what your diploma may suggest.

Uplifting, no? But Leamer goes on with some numbers to prove his point. First, growth in GDP has not been connected to job growth, indicating that companies can expand without hiring. Second, productivity is improving, meaning workers are needed for fewer hours of work. Hours have declined 9% in this recovery, compared with 5.5% in the 2001 recession.

"Expect 3% GDP growth by unemployment very persistent," he writes.

In the past, there would be industries to absorb some of the workers displaced from manufacturing jobs by robots, Leamer says. But now, with construction in the toilet, manufacturing continuing to shrink, and retail shrinking because of online shopping, there are fewer and fewer jobs available.

Governments, saddled with pension obligations, can't hire many more education and health care workers. Manufacturing workers with little education can't likely transition to professional and business services jobs, nor to insurance or real estate.

That means the only industries to absorb the workers, Leamer says, are repair and maintenance, personal and laundry services, religious, grant-making, civic, professional and other organizations, and private households.

Here's to hoping the robots don't learn how to do laundry!

-- Alana Semuels

Photo by Mr. T in DC via Flickr

 

 

 

Comments 

Advertisement










Video