You might hear about how the labor participation rate is the economic ‘elephant in the room’, despite the positive news regarding job growth over the past several years. As the headline, or official U3 unemployment rate edges closer to ‘full employment’, there are still a host of Americans not working — more than one-third of the population, in fact.
There are many reasons for that, including the fact the Baby Boomers are retiring, college enrollment numbers are up, etc. And it can be taken as a bad omen — people still can’t find jobs — or as a positive sign, in that people are more secure not working, or even quitting jobs they do have. But this is merely the beginning of a larger trend that will see millions jettisoned, against their will, from the workforce.
Because the automation revolution is coming.
It’s something that has been written about and discussed at length. Yet, few seem to really be taking it seriously. Widespread automation is set to wipe out millions of jobs, and legislators, business, and political leaders seemingly have zero idea of how to deal with the fallout. In fact, by most recent counts, as much as 47% of all jobs in the U.S. could be taken over by artificial intelligences.
And we’re not talking about the distant future, either — this could happen soon. As in, within a decade or two.
While people are apt to think that unskilled workers are the most vulnerable, the threat goes deeper. Fast food cashiers, truck drivers, and a host of other jobs are set to disappear in an initial wave, but guess who’s next on the chopping block? Those that manage such positions, and perhaps even entire professions.
The point is, the threat artificial intelligence and automation poses to the economy is a danger to everyone, not just those on the lowest rungs of society.
Traditionally, what has happened as new technologies have moved in to replace workers is that those workers get absorbed by other segments of the economy. That can mean retraining for other jobs, taking what they know and starting their own firms, or adjusting their skill set to find work in conjunction with the emerging technology — instead of a miner using a pickax, the miner learns to use a drill, for example.
This time, many economists feel that things are different. Technology has gotten to the point where computers can literally think for themselves, solve problems, and engage in complex tasks. Who knows, maybe entire new industries will spring up as a result of technology taking over, but at this point, it’s a scary prospect.
Mankind has experienced similar scares throughout history. The Luddites are the prime example, as they set fire to their factories in order to avoid being replaced by new machines and technology. But if there is something to take comfort in, it’s that new technologies, over the past 140 years or so, have actually created more jobs than they’ve destroyed.
Still, what we’re faced with at this point in time isn’t the cotton gin, or a printing press. And that’s what should have us all on our toes — because if half of all the nation’s jobs evaporate in a short amount of time, it’ll be an ugly scene. Again, one that we don’t have a plan for. Basic income? Massive job retraining and social program implementation? Armed revolution? It’s hard to say.
For the time being, the best thing you can do to prepare for the inevitable wave of automation is to make yourself as indispensable as possible. Similar to the conditions we saw during the financial crisis and Great Recession, companies are going to off-load dead weight, and keep valuable assets aboard. That means that you need to be valued more than the guy next to you. And soon, more than a robot.
We’ve written about this previously, although pertaining to another recession. In short, what you can do is pay attention, learn new skills, and keep your finances in order. It’s not much, but those simple steps will put you miles ahead of many others.
You may not be able to stave-off the coming economic robopocalypse, but you can at least get ready for the impact.
Follow Sam on Twitter @SliceOfGinger