They’re arguing that the pandemic “didn’t just threaten Americans’ health when it slammed the U.S. in 2020 — it may also have posed a long-term threat to many of their jobs.”
Faced with worker shortages and higher labor costs, companies are starting to automate service sector jobs that economists once considered safe, assuming that machines couldn’t easily provide the human contact they believed customers would demand. Past experience suggests that such automation waves eventually create more jobs than they destroy, but that they also disproportionately wipe out less skilled jobs that many low-income workers depend on. Resulting growing pains for the U.S. economy could be severe…
Ideally, automation can redeploy workers into better and more interesting work, so long as they can get the appropriate technical training, says Johannes Moenius, an economist at the University of Redlands. But although that’s happening now, it’s not moving quickly enough, he says. Worse, an entire class of service jobs created when manufacturing began to deploy more automation may now be at risk. “The robots escaped the manufacturing sector and went into the much larger service sector,” he says. “I regarded contact jobs as safe. I was completely taken by surprise.” Improvements in robot technology allow machines to do many tasks that previously required people — tossing pizza dough, transporting hospital linens, inspecting gauges, sorting goods.
The pandemic accelerated their adoption. Robots, after all, can’t get sick or spread disease. Nor do they request time off to handle unexpected childcare emergencies.
Economists at the International Monetary Fund found that past pandemics had encouraged firms to invest in machines in ways that could boost productivity — but also kill low-skill jobs. “Our results suggest that the concerns about the rise of the robots amid the COVID-19 pandemic seem justified,” they wrote in a January paper… Employers seem eager to bring on the machines. A survey last year by the nonprofit World Economic Forum found that 43% of companies planned to reduce their workforce as a result of new technology. Since the second quarter of 2020, business investment in equipment has grown 26%, more than twice as fast as the overall economy.
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