Automation is taking human jobs and peace of mind, but it doesn’t have to

We live in an age of automation anxiety. People are more anxious about the impact of robots and computers on jobs than they have been in a long time. But this is not the first time we have experienced a comparable level of public concern.

David Autor, MIT economist and Urban Institute trustee. Photo by Peter Tenzer

David Autor, MIT economist

and Urban Institute trustee.

Photo by Peter Tenzer

In the early 19th century, a group of English workers who called themselves “Luddites” rose up against mill owners and power loom operators, concerned that automation would make their jobs and skills redundant.

Similarly, in 1927, US Secretary of Labor James Davis worried about the “scrapping of men,” that the automation of steel mills and other industrial functions would eventually eliminate jobs.

In 1982, Nobel laureate Wassily Leontief wrote in Scientific American that people were like horses: their skills were becoming obsolete, and they’d soon be put out to pasture.

What history teaches us

We’ve had a couple hundred years of periodic concerns. So far, things have worked out. Automation has not made our skills redundant or our labor obsolete.

There are a few lessons that people are tempted to draw from this history. One is, “See? It will take care of itself. It works out.” Another lesson is that this time is different. History has no relevance. We’re doomed. Our fates are sealed. I think both lessons are incorrect. Every time is different of course, and it’s hard to predict with complete certainty. But it is not the case that the problem took care of itself in the past. It presented us with consequential choices, and we’ve made good decisions in light of those choices.

In the late 1800s and early 1900s, employment in agriculture was dropping rapidly because of advances in tractors, irrigation, and genetics. Farm-state families saw themselves at a critical juncture. They faced the possibility that their children would no longer be needed on the farm yet were not going to be adequately trained for industry. In response, they mandated that their children stay in school until at least age 16. Why was this radical? It was expensive, not simply because it meant hiring teachers or buying books and building buildings. But it meant that those children couldn’t work during those years. You were giving up a lot of the valuable labor in your family.

At the time, many people thought this was a frivolous investment. In retrospect, this was probably one of the greatest public investments the US made in the 20th century. It gave us the world’s most educated, most flexible, and most productive labor force. Tellingly, it was the farm states that led what became the high school movement, mandating that children go to school before entering the workforce. That was the right call. It didn’t take care of itself, and it wasn’t the technology of agriculture, nor was it the market that made this happen. Social and public institutions facilitated the decision to invest in ourselves, our families, our communities, our states, and our country to take advantage of the new opportunities technology presented us.

Will we make the right choice?

We face a similar opportunity today. When people talk about automation and its impact on employment, they tend to think of automation as being like global warming, a problem we have to deal with now but wish we didn’t have to face. Technology is more like oil. It’s a source of energy, a source of opportunity. Global warming is one of the potentially negative consequences of mismanaging the opportunity of fossil fuels. But the technology is an opportunity. Some of the adverse consequences are things we need to steer clear of.

But even oil can be mishandled. Take Norway and Saudi Arabia, two oil-rich countries that have money coming out of a hole in the ground. Yet with the same oil wealth, the same technology, and the possibility of the same market structure, they have different outcomes. The difference is their institutions. Norway is a thriving democracy that invests to create opportunity and mobility. Saudi Arabia is an absolute monarchy that raises the material living standards of its citizens but thwarts other desires for human advancement.

We know that over the past 200 years, technology has complemented our expertise, judgment, and creativity. It has displaced a lot of human labor. People can no longer make a living merely on the strength of a strong back and good character. You need numeracy. You need literacy. That’s why the high school movement was so important at that time.

I expect these trends to persist. I expect that quintessential human skills—expertise, judgment, and creativity—will be in greater demand. So the question we face is this: which institutions and which investments are critical for success for the most citizens at this inflection point? Are our educational institutions sufficient? I doubt it. It’s going to take lifelong learning, retraining, and a lot of social supports to help people adapt to the changes we will face. And there is no question we can blow this. There’s no rule that says we will get through this well. But we sit at the cusp of great opportunity. I hope we will use it well.

David Autor is associate chair of the Massachusetts Institute of Technology’s department of economics and an Urban Institute trustee.