Hilsenrath writes about David Autor, a Massachusetts Institute of Technology economics professor who presented a paper at Jackson Hole.
Autor says the most recent era of automation, up to 2007 benefited professional, technical and managerial occupations while sapping wage gains from sales, office work, manufacturing and administrative workers.
Autor says people consistently underestimate the power of workers to adapt to changes in machines.
“The green revolution displaced labor from farming. The industrial revolution replaced skilled artisanal labor with unskilled factory labor. The mass-produced automobile drastically reduced demand for blacksmiths, stable hands, and many other equestrian occupations. Successive waves of earth moving equipment and powered tools displaced manual labor from construction.
“In each case, groups of workers lost employment and earnings as specific jobs and accompanying skill sets were rendered obsolete. Yet, short-term employment losses sparked by rising productivity were eventually more than offset by subsequent employment gains–in some cases in the innovating sectors, in many cases elsewhere.”
I think he’s underestimating the pace and damage of the next wave of automation. Sure “in the long run” we will find a way to move forward but in the short and medium run it could be extraordinarily painful.