What do we do when we run out of labour?

Great Debates
61

There seems to be a bit of misunderstanding going on here.

The only reason strong AI was brought up was to point out that there are many jobs that simply cannot be automated unless you can automate understanding and generation of natural language. You can’t automate the marketing department unless you produce a computer with strong AI.

Sure, I agree that there are lots of jobs today that are automatable with only evolutionary improvements in factory equipment, and there are catagories of white collar and pink collar work that can be eliminated or transformed by automation. That’s called productivity increase. But you can’t fire your legal department, you can’t fire your marketing department, you can’t fire your sales department, you can’t fire your HR department, even if you can make their jobs easier.

So even in an industry where literally no human being sets foot on the factory floor once the factory begins production, companies will still need workers. But all we’ve imagined then is that there are no more agricultural and industrial jobs. I still don’t understand the argument that the service economy depends on a core of residual industrial jobs. If only 1% of our workforce is employed in agriculture, and 10% is employed in industrial work, why would it cause an economic collapse if we slowly got rid of those jobs? Why didn’t we have an economic collapse when the 90% of the population employed as agricultural workers were put out of jobs?

In other words, I think an argument is being made that the wages of industrial workers somehow underpins our economy, and once those are gone the vast majority of service industry jobs will disappear as well. But I don’t understand why that is predicted to happen.

As for the divide between expensive luxury goods available to the super-rich and cheap crap available to the super-poor, and nothing in between, I suppose there is a bit of truth to that. Today, any goods that require human intervention are expensive, while goods that can be mass-produced with no human labor inputs are cheap. But what is so horrible about that? If you want a hand-made wooden bowl it will cost much more than a stainless steel bowl from Target. But is that wooden bowl really a “better” bowl? It is more expensive, but what makes it better, what makes it a luxury item? Anybody remember when digital watches were luxury items? Nowadays it is pretty much impossible to find a luxury digital watch, since digital watches are literally being given away in cereal boxes. What makes a mas-produced stainless steel (or the despised plastic) bowl crap but a handmade wooden bowl quality? Yes, the rich today can get a jewel-encrusted bowl. In 20 years the poor will be buying cheap mass-produced solid diamond bowls, and everyone will complain about how tacky and cheap looking they are.

62

mazinger: The original question never posited what would happen if all labour were to disappear because that would be almost impossible due to the extremityof the situation. Instead, I asked what would happen if a certain segment of the population became unemployable because they possessed no skills that society needed.

And just because labour might fall to 0 by no means indicates that resource costs will fall, rather, whats more likely is that resource costs will rise since there will be a greater demand for goods. Gold will still be rare replicator or no replicator. Producing good wine is still going to require many years of ageing. In other words, there will still be scarcity.

If the rich person needs the labour of the poor person, why would the price be high? There would be a huge supply of poor people and little demand so, logically, the price should be low. If the government steps in and redistribute goods, then what you have in effect is massive socialism which is frankly not something I can really see America turning into. Scandinavia maybe, but not the US.

Lemur866: Just because it’s a service job doesn’t mean it can’t be automated, Supernarket checkout people are being replaced by RFID, fast food outlets in Japan have been trialling touch screen ordering for quite a few years now. Even marketing and legal, if not completely eliminated, can be massively pared down, 50 years ago, executives needed secrataries to write their memos, nowadays, everyone knows how to use email. But the service jobs that remain all require talented people with some sort of distinctive skill. I don’t doubt that these people will still be in demand for quite some time. I’m asking what happens to the people with no obvious talent in any of these areas?

63

I wasn’t responding to your question. I think it was Evil Captor, I’m too lazy to look. However, I will answer your OP. [note: btw, your question was taken to the extreme, b/c that is the easiest way to posit a point, and besides you started to do so when you mentioned on-line booking and automated checkers]

It seems you want to deal with the scenario where there are people who have no skills, can generate no wealth, b/c their unskilled labor is easily replaced by machines. This scenario will always exist. There will always be a percentage of people who, for whatever reason, is unemployable. When I took economics, that number of people was posited to be between 4-4.5% of the population. These people were by and large, choosing not to work (or else mentally/physically unfit).

So, what do we do with those people above this threshold (those not working) because they have no skills? The obvious answer is to educate them. There will always be a sector which needs an influx of people, e.g. nurses and teachers. Other sectors can use an influx of people so that competition drives down the costs, e.g. doctors and lawyers.

The two alternatives you offered: killing them and providing them with below poverty level assistance are not the only choices. If education is not provided then the poor really can’t really offer value with their current skill sets, can they? This would be, I argue, another function for the gov’t to help ease the transitions between economic cycles.

My, albeit limited, reading of Star Trek novels says otherwise. However, if your Star Trek lore is greater than mine, I will bow to your authority. :slight_smile:

Ok, we seem to reading far too much into each other’s statements. I took your example with the game reserve to mean one localized area of poor people and one rich slob. How many poor people? It couldn’t possibly be that many because what incentive is there for a poor person to stay in an area with no economy? In this example, the remaining labor would have enough information to pool their resources together, sort of like a union, and bargain collectively. The cost to the land owner is going to be high in terms of relative wealth of his land in comparrison to whatever wealth he would have reaped himself.

For example, Land Owner is hungry and wants to eat. It takes him forever to track deer to kill and prepare it to be eaten. He figures that if he can get 10 other people to help him, the process would go by much quicker. That is true, but there is a price to that efficiency. These 10 people are not going to work for free. They will at least want part of the kill. It turns out that one deer cannot feed 10 people, the Land Owner nows needs to kill 2 deer. If the Land Owner killed the one deer by himself, he would have a lot more meat left over, more deer in his reserve, and he wouldn’t need to hunt for a longer while. This is part of the high price that I was talking about. You are correct, however, in terms of the overall market that if there is greater aggregate supply of labor and low aggregate demand of that labor then the price of the labor will be lower.

It depends on what is the redistribution. What I am envisioning is a tax. Socialism is where the state owns the production and distribution of goods. I’m envisioning a tax. The land owner is taxed to help provide community services, police, fire department, public works, etc. The government is not going to rob inventories from various industries and drop them at the door step of the poor. They should be redistributing monies (tax refunds, welfare checks, food stamps, medicare, social security, etc.), and providing education (unemployement centers, seminars, etc.) In fact, this is what the US is doing right now.

64

Okay, lets assume the proportion today stands at 5% who are physically and mentally unable to find a job, what if that percentage rises to 20%? or 30%? Left unchecked, it could quite easily become a serious social problem.

But what I’m suggesting is that there is only so much education can do, not everyone can become a teacher or a lawyer even if they tried their hardest. What if we have this segment of the population that literally can’t be educated into something useful? For the last 200 years or so since the industrial revolution, there has always been a job that literally almost anyone could do and was enough to survive unglamourously on. Coal mining, factory worker, Walmart checker. But I forsee that in the near future, this type of job is going to disappear. What happens then?

The poor person would be unemployable everywhere.

I don’t think unions work the way you think they do, they can’t subvert the laws of supply and demand.

No, you were positing a scenario in which labour costs were 0, in other words, the land owner is perfectly capable of killing his own deer without any outside intervention via automation and the like.

What incentives is the government going to give the rich to justify taxing them? Why don’t the rich just revolt and go away and form their own republic?

65

So let’s indulge in a hypothetical.
Say there are a million workers. They make widgets. They are paid well and the widgets are profitable items to produce, and there is fixed demand.

Lets say other changes are made. Now one thousand workers can make the entire amount of widgets that the market wants. Widgets are good for much else, so people are not making up more uses for them even if the price drops. The company can now afford to pay more for the labor or charge less for widgets. Unless there is a competing product for widgets, they won’t lower prices. If the skills level for widget making have not changed much, won’t the wage for widget making plummet instead because the labor pool is much larger than needed?

66

Really the question is ‘what does a society do with it’s members who are unable or unwilling to provide a meaningful contribution’? We are just taking it to an extreme case where automation has basically removed the majority of unskilled labor. Maybe it’s the evil businessperson in me but there’s something I just find offensive about supporting a large segment of stupid and useless people. Kind of like a reverse aristocracy - the wealthy and upper-middle elite working to support the idleness of the masses.

Maybe we will become a society that produces nothing but entertainment? We’ll all be on TV/ movies/video/internet/magazines just paying each other to keep us amused with outlandish antics.

Should those people who live on government handouts have the same rights as those of us who work to support them? Do we become a de facto aristocracy that must basically care for this segment of the population like adult-children - incapable of caring for themselves?

Obviously it’s not a requirement, but like anything else, it helps to have an understanding of a topic if one wishes to engage in a debate. There are many aspects of both micro and macro economics that are counterintuitive (for example - why rent control or minimum wage laws can have undesired consequences).

67

Personally, and as others have also stated, I don’t even see this happening in the next millenia. There will always be some type of customer service or manual labor job available. Someone will always have to throw out the garbage, clean the sewers, take care of the kids, wash the windows, etc. Like I said, the number of unemployable will always be around 4%. If you want argue advances in machine automation, then steer your asrgument that way and provide some cites where you see people flocking towards towards such automation and how that such machinery is replacing labor. I don’t think you can. When I used to live in England, I used to hold up lines at the supermarket because I would never bag my groceries until someone told me to. I never asked, but I somehow think that it’s against the law to bag groceries (other than your own), like it’s illegal to pump your own gas in NJ. So, I would be there, holding up the line, b/c I wouldn’t start bagging until after the check out, and after an exchange of dumbfounded looks as to why my groceries weren’t bagged. I remember thinking about how I would open a supermarket that had baggers, or I would pay some dude like ₤2 to bag them. The point I’m trying to make is that whenever I’m in Walmart or Home Depot, I hardly see anyone flocking to the automated check out. People will pay to have a real live check out person.

As more automation progresses, I see the economy growing, creating more wealth across the board (debates of wealth inequities aside, please see the other thread on this matter). People will pay for human contact and the rest will save money using machines. Oh, and another example, at the movie theater, how many people do you see wait in those long-ass lines to buy a ticket when the automated machine is hardly being used? Don’t tell me all those people are paying with cash.

:dubious: Ok, then, how do they work? Unions pool their resources together because they know the other party can afford it. They ask for the same benefits across the board. For the most part, it’s all good. It’s when they start stratifying the work and creating inefficiencies is when I have a problem (and I argue, a natural problem with unions, but this is neither here nor there.)

What are you getting at? What taxing system do you live under? In the US, we have a progressive tax system. Haven’t you read all those posts about the Laffer Curve and how the rich pay upwards of 50% of the tax (depending on whose argument you believe)? People will pay the tax to a point, you’re right. However, taxes are a necessary part of the government. They need revenue to run, to administer defense, social services benefits, keep the roads clean, keep the skies safe, etc. The rich don’t leave and form their own republic b/c it’s a) probably illegal, unless they leave the country; b) their industry is in the country, and it’s not like they’re going to pull up shop and sell to themselves, taking themselves out of the market (or limiting it as such); c) they can’t lose their supply of labor and resources; d) they need a stable governement to enforce the rule of law, etc. Eventually, there is a point where the bourgeoise will see a country with more attractive government tax system, safer area to do business, etc., but that is sort of pointless to debate as well.

68

But Lee, your scenario postulates that the widget making company has no competition. And this is very implausible, because even if there is no direct competition for good, there is almost always some sort of indirect competition. Even if you own the only titanium mine on earth, your customers can respond by not designing products that require titanium. If copper becomes too expensive people switch to plastic pipes.

So what typically happens in your scenario is that widgets become commoditized. They are cheap to produce and cheap to buy and there isn’t much profit in widget making anymore. Any time the the demand goes up by a tiny amount the supply can easily be increased to take advantage of the increased demand and vice-versa. Widget-making, which used to be a cash cow, is now a very low margin business.

As for what happens to the widget makers now that fewer are needed, it depends. How specialized are widget making skills? How difficult is it for widget makers to retrain to be gadget makers? If widget makers can fairly easily become gadget makers then the pool of competing widget makers will fall to meet the demand, and the wages of widget makers will be broadly comparable to gadget makers. Even if widget making is a specialized skill, the wages of widget makers can’t fall much below what widget makers could make if they started over in a new trade. Sure, they can’t recover their sunk costs in widget-making training, but they can still compete with other lower skilled workers in other industries.

So does the skilled, dedicated craftsman now have to work minimum wage jobs flipping burgers at McDonalds? Somehow I doubt that will happen often. That would assume that someone could become a skilled dedicated craftsman in one field, but that’s it. They are completely hopeless in all other endeavors. I imagine that if someone has the patience and aptitude to learn one skill they should be able to learn another skill.

Yes there are people who don’t have the ability to learn even one skill, and I imagine that public assistance will always be needed for the developmentally disabled. I just don’t think most people with obsolete skills are developmentally disabled and unable to learn another thing in their lives. How did they learn their obsolete skills in the first place? Learning to get up every morning and show up at work on time and not punch your boss is beyond many people, if a worker in an obsolete industry was able to do that then they are ahead of a lot of people.

I guess I just don’t believe that a large fraction of human beings are uneducatable.

69

But Lee, your scenario postulates that the widget making company has no competition. And this is very implausible, because even if there is no direct competition for good, there is almost always some sort of indirect competition. Even if you own the only titanium mine on earth, your customers can respond by not designing products that require titanium. If copper becomes too expensive people switch to plastic pipes.

So what typically happens in your scenario is that widgets become commoditized. They are cheap to produce and cheap to buy and there isn’t much profit in widget making anymore. Any time the the demand goes up by a tiny amount the supply can easily be increased to take advantage of the increased demand and vice-versa. Widget-making, which used to be a cash cow, is now a very low margin business.

As for what happens to the widget makers now that fewer are needed, it depends. How specialized are widget making skills? How difficult is it for widget makers to retrain to be gadget makers? If widget makers can fairly easily become gadget makers then the pool of competing widget makers will fall to meet the demand, and the wages of widget makers will be broadly comparable to gadget makers. Even if widget making is a specialized skill, the wages of widget makers can’t fall much below what widget makers could make if they started over in a new trade. Sure, they can’t recover their sunk costs in widget-making training, but they can still compete with other lower skilled workers in other industries.

So does the skilled, dedicated craftsman now have to work minimum wage jobs flipping burgers at McDonalds? Somehow I doubt that will happen often. That would assume that someone could become a skilled dedicated craftsman in one field, but that’s it. They are completely hopeless in all other endeavors. I imagine that if someone has the patience and aptitude to learn one skill they should be able to learn another skill.

Yes there are people who don’t have the ability to learn even one skill, and I imagine that public assistance will always be needed for the developmentally disabled. I just don’t think most people with obsolete skills are developmentally disabled and unable to learn another thing in their lives. How did they learn their obsolete skills in the first place? Learning to get up every morning and show up at work on time and not punch your boss is beyond many people, if a worker in an obsolete industry was able to do that then they are ahead of a lot of people.

I guess I just don’t believe that a large fraction of human beings are uneducatable.

70

Didn’t a previous post pooh-pooh the idea of the right wanting to kill off the poor?

Actually, the US has a very active and successful program to increase the proportion of “stupid and useless” people being supported by the rest of us. It’s called the War on Drugs.

71

I don’t believe I said anything about killing off the poor. I don’t believe that an entire segment of society should be subsidized to do nothing but sit on their ass doing drugs all day either.

But that’s pretty much what might happen. If a huge number of people have to be taken care of then they will be pretty much at the mercy of the people who take care of them. They will be treated like children at best and prisoners at worst.

A union works by creating a monopoly of labor in a certain industry. They don’t work if a) there is a significant supply of labor that exists outside of the union b) there is no work for the union to do c) demand is such that it is more profitable to not be part of the union.

72

This is where you and I disagree. I am SURE most manual labor will disappear in the next 50 years. I’m not a manual laborer, it’s no skin off my back, except … except … it’s really going to fuck up the economy.

And yes, there will ALWAYS be low-paying service sector jobs. Problem is, how many jobs will there be and will there be enough to absorb the labor market? I think we are going to have a HUGE surplus of labor. American hasn’t seen double-digit unemployment in a LONG time, and they’re just going to HATE unemployment in the 30-50 percent range.

I’ll see what I can do about those cites but I’m really busy now and have limited Web access so it will be awhile. Other fish to fry and all that.