Could factories ditch workers? Should they?

If you’ve ever been on the Futurology community on Reddit, you’ve probably heard the following: “The same way horses were replaced by cars, humans will be replaced by AI. And no, we’re not talking about the barista or factory worker, but the skilled white collar professional as well!”. Communities like these are talking about a new kind of economic revolution, a big shift in the economy. They talk about massive numbers of people who will now be unemployable, and about how AI will render most professions useless.

However, this will likely not be the case. Economists, in particular, disagree with this outcome. Here are a few reasons as to why:

Employment is not a zero sum game. Let’s say a new machine comes out and can replace 10% of all workers. Sure, in a few years time, they will likely loose their jobs, but they won’t stay unemployed forever. Humans have a wide range of skills, those without a job will find a new one soon enough. Artificial Intelligence does not create structural unemployment.

Technology has the effect of increasing productivity. This has happened before. Most humans used to have agricultural related jobs, and when better tools came out and replaced those jobs, humans only got smarter, more specialized and doing more productive jobs, and the farmers that continued to work the fields now had a better way to take care of plants and harvest their crops. It’s not hard to imagine how replacing 50 factory workers out of 100 with machines makes the remaining 50 more efficient.

…and wages follow productivity. A worker is more valuable to a company if he is more productive, even if this productivity increase happened because of automation. Simple. However, there’s something that needs to be pointed out: this only happens to the skilled worker. Those without skills, that can’t interact with robots or AIs, will not see their productivity increase by much, which may raise inequality concerns.

…and increases in productivity mean decreasing prices. This is not hard to imagine. If a machines starts writing articles more efficiently, the price of articles will go down, and they’ll be more readily available for everyone to read.

The idea that AI would replace white collar workers, and the human-horse metaphor as well, was initially popularized by youtuber CGP Grey, in his video “Humans need not apply”, which talked about how this new AI revolution was similar to how Mechanization replaced some agricultural jobs, but was different in the way it would render almost all human jobs useless, and create massive structural unemployment.

But this is not a possible outcome. Unlike what is said in the video, we have been here before. At least 90% of all jobs two and a half thousand years have been replaced, and we have not only moved on to better jobs, we now have an abundance of the goods those jobs used to produce. We should expect the same to happen now. Humans will likely move on to better jobs, and if there are no jobs to move on to, a pretty big if, we will still be enjoying that second consequence, Humanity will be living in an almost post-scarcity world.

Farming and herding was all we did two and a half thousand years ago (in case you didn’t ge it)

To conclude, if unemployment is not an issue we should expect from a new job market revolution led by AI, what problems SHOULD we expect. First of all, income inequality should worsen: the most skilled, which are usually a part of the richer half, will only get more wealthy, while the least skilled will not see a significant increase in their income. Secondly, some of the skills that workers have today will not be useful after this ‘revolution’, which might indeed cause short-term unemployment. This is not the biggest of problems, since humans tend to have a wide range of skills, but it might cause a couple of career changes for some folks.

An AI revolution might completely change the economy, and our social lives for that matter. But, please, do not give in to fear mongering: if you are a highly skilled worker, you are likely to benefit, but you do need to start caring about those who will not.