Ill be concentrating on specific claims made in the video. Below, I have the full transcript of the video, automatically generated by the good folks at Youtube. I apologize for the grammatical and syntax errors in the transcript. Some things really take a human touch.
How long do you think it will take before machines do your job better than you do?
And right out of the gate the video is going on the road towards a pretty common error. Whenever we discuss the relationship between automatic and employment, its vital to recall the difference between
absolute and comparative advantage.
Human brain are nothing special theres no reason to expect that, in the long run, machines will be unable to outperform us in any field of endeavor. But! Whether that happens or not is entirely irrelevant to whether humans still have jobs!
Even if machines have an absolute advantages in all fields, humans will have a comparative advantage in some fields. There will be tasks that computers are much much much better than us, and there will be tasks where computers are merely much much better than us. Humans will continue to do that latter task, so machines can do the former.
Automation used to mean big stupid machines doing repetitive work in factories. Today they can land aircraft, diagnose cancer and trade stocks.
In other words, small stupid machines doing repetitive work in the cloud.
We are entering a new age of automation unlike anything that's come before. According to a 2013 study almost half of all jobs in the US could potentially be automated in the next two decades.
But wait hasn't automation been around for decades? What's different this time?
Things used to be simple. Innovation made human work easier and productivity rose.
Productivity has been stagnant in recent years. But remember that were (still!) emerging from a severe recession. As people re-enter the labor market, the average productivity can decrease, as it was predominantly low productivity workers who exited during the recession.
In general, be careful about making strong claims about general economic tendencies within a business cycle. Its usually best to look a bit broader, or to measure relevant statistics from peak to peak, or trough to trough. If you are measuring trough to peak (or, at least, trough to local maxima) you are going to be capturing cyclical trends that are likely to be reversed in the short term.
Which means that more staff or services could be produced per hour using the same amount of human workers. This eliminated many jobs it also created other jobs that were better which was important because the growing population needed work.
So in a nutshell innovation higher productivity fewer old jobs and many new and often better jobs overall this worked well for a majority of people and living standards improved. There's a clear progression in terms of what humans did for a living. For the longest time we worked in agriculture. With the Industrial Revolution, this shift into production jobs and as automation became more widespread, humans shifted into service jobs and then only a few moments ago in human history the Information Age happened. Suddenly, the rules were different. Our jobs are now being taken over by machines much faster than they were in the past.
I think this framing, which is pretty common, gives a warped mental model of why people have moved from sector to sector.
This is important, and not well covered in the FAQ, so lets walk through it in detail.
Theres a sense you get out here that humans are constantly fleeing from sector to sector as the advancing robotic hordes take over jobs.
But
thats a misrepresentation, and gets the emotional tenor of the history wrong. Heres an alternative timeline.
- Most people work in farming.
- Eli Whitney invents the cotton gin, farming becomes much more productive.
- People have enough to eat and go up Maslows ladder. Now, at the margin you want stuff. And fortunately, they have a bunch of new wealth with which to purchase it!
- People are hired to start manufacturing jobs.
- Henry Ford invents mass production and manufacturing becomes much more productive.
- People have enough stuff, and now they want services. And fortunately, they have a bunch of new wealth with which to purchase it!
- People are hired to provide services. They argue laws, diagnose cancer, and ring up peoples orders.
Jobs arent taken over by machines. Machines make people more productive, and richer than they were in the past. Because we are more productive and richer we ascend Maslows pyramid. Its now worth paying people to do new stuff, that wasnt worth paying for when you couldnt eat.
As automation starts making the service industry more productive it is not the case that we are screwed and have no where to go. Either one of two things will happen.
- We will have finally achieved satiation, and no longer need anything.
- We will find new, wacky things for people to do.
Personally, I think the latter is more likely. Many people I know have jobs that would have seemed ridiculous a generation ago. I personally once got paid to make economics puns in Emily Dickinson poems a few years ago. I wouldnt be particularly surprised if the next economy is
people making jokes. Im not kidding. I dont mean, like, stand up. I mean funny jokes on twitter, flashmob esque pranks, funny youtube videos.
Maybe Im wrong (I probably am), but I dont think its any more absurd that the manufacturing economy would have seemed in the 1400s, or the services economy in the 1800s.
That's worrying of course... but innovation will clearly save us, right? While new information age industries are booming, they are creating fewer and fewer new jobs. In 1979, General Motors employed more than 800,000 workers and made about 11 billion U.S. dollars. In 2012, Google made about 14 billion U.S. dollars while employing 58,000 people. you may not like this comparison, but Google is an example of what created new jobs in the past - Innovative new industries. Old innovative industries are running out of steam. Just look at cars - when they became a thing 100 years ago, they created huge industries. Cars transformed our way of life, our infrastructure, and our cities. Millions of people found jobs either directly or indirectly. Decades of investment kept this momentum going. Today, this process is largely complete. Innovation in the car industry does not create as many jobs as it used to. While electric cars are great and all, they won't create millions of new jobs.
But wait... what about the internet? Technologists argue that the Internet is an innovation on a power of the introduction of electricity if we go with this comparison we see how our modern innovation differs from the old one the internet created new industries but they're not creating enough jobs to keep up with population growth or to compensate for the industries the internet is killing.
At its peak in 2004 Blockbuster had 84,000 employees and made 6 billion US dollars in revenue in 2016 Netflix had 4,500 employees and made 9 billion dollars in revenue. take us for example with a full-time team of just 12 people courtesan 2 reaches millions of people. A TV station with the same amount of viewers needs way more employees.
Innovation in the information age doesn't equate to the creation of enough new jobs which would be bad enough on its own but now a new wave of automation and a new generation of machines is slowly taking over to understand this we need to understand ourselves.
This is taking a microphenomena about how firms respond to diffuse information, and mistaking it for a broad macrophenomena. The number of jobs created by Google or Apple or whatever isnt the number of employees the firm has. Think about how many people work to create iPhone apps. Think about how many people work in Search Engine Optimization. Think about how many people work in Social Media. Ubers the most obvious example it has 12,000 direct employees and something like a million drivers working as independent contractors.
The macrophenomena is that the number of jobs has increased
pretty steadily, outside of business cycle fluctuations.
First human progress is based on the division of labor as we advanced over thousands of years our jobs became more and more specialized while even our smartest machines are bad at doing complicated jobs they are extremely good at doing now redefined and predictable tasks this is what destroyed factory jobs but look at a complex job long and hard enough and you'll find that it's ready just many narrowly defined andpredictable tasks one after another machines are on the brink of becoming so good at breaking down complex jobs into many predictable ones but for a lot of people there will be no further room to specialize we on the verge of being out completed digital machines do this fly machine learning which enables them to acquire information and skills by analyzing data this makes them become better at something through the relationships they discover machines teach themselves we make this possible by giving a computer a lot of data about the thing we wanted to become better at so a machine all the things you bought online and it will slowly learn what to recommend to you so you buy more things
This automatic transcript is a bit of a mess, which allows my point to be made almost entirely by dramatic irony.
But lets be a bit more ambitious the claim that machines are on the brink of becoming so good at breaking down complex jobs into many predictable ones but for a lot of people there will be no further room to specialize just isnt true, for reasons Autor explains in
Polyanis Paradox:
// The Polyani's Paradox point isn't great, but I've left it in for completeness.
Given their ubiquity, it is tempting to infer that there is no task to which computers are not suited. But that leap of logic is unfounded. Human tasks that have proved most amenable to computerization are those that follow explicit, codifiable proceduressuch as multiplicationwhere computers now vastly exceed human labor in speed, quality, accuracy and cost efficiency.3 Tasks that have proved most vexing to automate are those that demand flexibility, judgment and common senseskills that we understand only tacitlyfor example, developing a hypothesis or organizing a closet. In these tasks, computers are often less sophisticated than preschool-age children. The interplay between machine and human comparative advantage allows computers to substitute for workers in performing routine, codifiable tasks while amplifying the comparative advantage of workers in supplying problem-solving skills, adaptability and creativity. Understanding this interplay is central to interpreting and forecasting the changing structure of employment in the U.S. and other industrialized countries. This understanding is also is at the heart of the increasingly prominent debate about whether the rapid pace of automation threatens to render the demand for human labor obsolete over the next several decades.
While you can certainly imagine machines eventually learning how to do tasks that demand demand flexibility, judgment and common sense, were not there yet.
machine learning is now meeting more of its potential because in recent years humans have started to gather data about everything behavior weather patterns medical records communication systems travel data and of course data about what we do at work what we've created by accident is a huge library machines can use to learn how humans do things and learn to do them better these digital machines might be the biggest job killer of all they can be replicated instantly and for free when they improve you don't need to invest in big metal things you can just use the new code and they have the ability to get better fast how fast if your work involves complex work on a computer today you might be out of work even sooner than the people who still have jobs in factories
there are actual real-world examples of how this transition might be happening a San Francisco company offers a project management software for big corporations which is supposed to eliminate middle management positions when it's hired for a new project the software first decides which jobs can be automated and precisely where it needs actual professional humans it then helps assemble a team of freelancers over the Internet the software then distributes tasks to the humans and controls the quality of the work tracking individual performance until the project is complete ok this doesn't sound too bad while this machine is killing one job it creates jobs for freelancers right well as the freelancers complete their tasks learning algorithms track them and gather data about their work and which tasks it consists of so what's actually happening is that the freelancers are teaching a machine how to replace them on average this software reduces costs by about 50% in the first year and by another 25% in the second year
This company sounds pretty interesting. But Id like to know
who they are. Im willing to bet most project management jobs arent on the verge of automation, and this software only works in fairly narrow domains. Going to leave this piece to you /u/say_wot_again!
this is only one example of many there are machines and programs getting as good or better than humans in all kinds of fields from pharmacists to analysts journalists to radiologists cashiers bank tellers or the unskilled worker flipping
all of these jobs won't disappear overnight but fewer and fewer humans will be doing we'll discuss a few cases in a follow-up video but while jobs disappearing it's bad it's only half of the story it's not enough to substitute old jobs with new ones we need to be generating new jobs constantly because the world population is growing in the past we have solved this through innovation but since 1973 the generation of new jobs in the US has begun to shrink and the first decade of the 21st century was the first one where the total amount of jobs in the u.s. did not grow for the first time in a country that needs to create up to 150,000 new jobs per month just to keep up with population growth this is bad news
Picking 2000-2010 is cheating, and that should be pretty obvious to everyone. There was a financial crisis in early 2009. Total number of jobs in the US is
at an all time high and were not seeing any substantial divergence from historical trends (once we account for demographic shifts).
this is also starting to affect standards of living in the past it was seen as obvious that with rising productivity more and better jobs would be created but the numbers tell a different story in 1998 US workers worked a total of 194 billion hours over the course of the next 15 years their output increased by 42 percent but in 2013 the amount of hours worked by US workers was still 194 billion hours what this means is that despite productivity growing drastically thousands of new businesses opening up and the u.s. population growing by over 40 million there was no growth at all when the number of hours worked in 15 years
The source for this claim appears to be this BLS blogpost:
https://www.bls.gov/opub/btn/volume...tivity-tell-us-about-the-us-economy.htm#_edn1
Again, the business cycle is obscuring things here. While its not quite as obvious as moving from 2000 to 2010, 1998 to 2013 is still going to give you a false impression.
1998 was the height of the dotcom boom, with an unemployment rate at 4.5%, while the economy was still recovering in 2013.
Note that the BLS post is mostly trying to explain how increased capital makes us more productive. Whats interesting is that, even though labor hours are constant, output has dramatically increased over the same time period. It's not a puzzle or something. If cyclical unemployment rises as much as population increases, you expect total hours to be the same.
at the same time wages for new university graduates in the US have been declining for the past decade
Nope. See
Figure 6 specifically.
while up to 40 percent of new graduates are forced to take on jobs that don't require a degree
Id like to see some longitudinal data what has the number been historically? Many jobs dont require a degree, which doesnt indicate that a degree is not useful.
productivity is separating from human labour the nature of innovation and the information age is different from everything we encountered before this process started years ago and is already well underway even without new disruptions like self-driving cars or robot accountants it looks like automation is different this time this time the machines might really take our jobs
This is just an assertion, and not one that has been justified by the previous arguments. The video has not actually made the case that things are different, merely claimed it.
our economies are based on the premise that people consume but if fewer and fewer people have decent work who will be doing all the consuming are we producing ever more cheaply only to arrive at a point where too few people can actually buy all our stuff and services or will the future see a tiny minority of the super rich who own the machines dominating the rest of us and does our future really have to be that grim
This is what Krugman called
Vulgar Keynesian Economics. Its a misconception of macroeconomics, based on the incorrect belief that the Keynesian Cross is a model appropriate for thinking about long term growth, and not simply a toy model that only works at the zero bound.
/u/wumbotarian has a
good RI. Also see
Krugman here:
So am I saying that you can have full employment based on purchases of yachts, luxury cars, and the services of personal trainers and celebrity chefs? Well, yes. You dont have to like it, but economics is not a morality play, and Ive yet to see a macroeconomic argument about why it isnt possible.
(Confidential to /u/Integralds you must have a canon Keynesian Cross explainer right? I didnt find it readily)
while we were fairly dark in this video it's far from certain that things will turn out negatively the Information Age and modern automation could be a huge opportunity to change human society and reduce poverty and inequality drastically it could be a seminal moment in human history we'll talk about this potential and possible solutions like a universal basic income in part two of this video series we need to think big and fast because one thing's for sure the machines are not coming they are already here
The UBI as the cure to automatic still makes little sense,
as Ive outlined here
this video took us about 900 hours to make andwe've been working on it for over nine months projects like this one would not be possible without your support on patreon.com if you want to help us out and get a personal Kurzgesagt bird in return that would be really huseful we based much of this video on two very good books the rise of the robots and the second Machine Age you can find links to both of them in the video description highly recommended also we make a little robot poster you can buy it and a lot of other stuff in our DFTBA (Don't Forget To Be Awesome) shop. This video is part of a larger series about how technology is already changing and will change human
Its really awesome that they do cool videos like this, and Im sure that the others they have made arent as full of errors. Automation has made food and stuff and even services cheap. That means that people will happily give money away on Patreon to creators, and that creators can live off of those proceeds! When you watch a cool video like this, or numberphile or CGP Grey, remember that its automation that made our society rich enough that people can do cool stuff like this! (For that matter, automation means that I have enough of my needs fulfilled that I will spent a bunch of time writing RIs.)
