Where have the jobs gone

[dazed&confused]

http://www.nbcnews.com/business/holy-ha ... -1B8057232

Holy HAL! A robot stole my job
PAUL WISEMAN , The Associated Press



Five years after the start of the Great Recession, the toll is terrifyingly clear: Millions of middle-class jobs have been lost in developed countries the world over.

And the situation is even worse than it appears.

Most of the jobs will never return, and millions more are likely to vanish as well, say experts who study the labor market. What's more, these jobs aren't just being lost to China and other developing countries, and they aren't just factory work. Increasingly, jobs are disappearing in the service sector, home to two-thirds of all workers.

They're being obliterated by technology.

Year after year, the software that runs computers and an array of other machines and devices becomes more sophisticated and powerful and capable of doing more efficiently tasks that humans have always done. For decades, science fiction warned of a future when we would be architects of our own obsolescence, replaced by our machines; an Associated Press analysis finds that the future has arrived.

"The jobs that are going away aren't coming back," says Andrew McAfee, principal research scientist at the Center for Digital Business at the Massachusetts Institute of Technology and co-author of "Race Against the Machine." "I have never seen a period where computers demonstrated as many skills and abilities as they have over the past seven years."

The global economy is being reshaped by machines that generate and analyze vast amounts of data; by devices such as smartphones and tablet computers that let people work just about anywhere, even when they're on the move; by smarter, nimbler robots; and by services that let businesses rent computing power when they need it, instead of installing expensive equipment and hiring IT staffs to run it. Whole employment categories, from secretaries to travel agents, are starting to disappear.

"There's no sector of the economy that's going to get a pass," says Martin Ford, who runs a software company and wrote "The Lights in the Tunnel," a book predicting widespread job losses. "It's everywhere."

The numbers startle even labor economists. In the United States, half the 7.5 million jobs lost during the Great Recession were in industries that pay middle-class wages, ranging from $38,000 to $68,000. But only 2 percent of the 3.5 million jobs gained since the recession ended in June 2009 are in midpay industries. Nearly 70 percent are in low-pay industries, 29 percent in industries that pay well.

In the 17 European countries that use the euro as their currency, the numbers are even worse. Almost 4.3 million low-pay jobs have been gained since mid-2009, but the loss of midpay jobs has never stopped. A total of 7.6 million disappeared from January 2008 through last June.

Experts warn that this "hollowing out" of the middle-class workforce is far from over. They predict the loss of millions more jobs as technology becomes even more sophisticated and reaches deeper into our lives. Maarten Goos, an economist at the University of Leuven in Belgium, says Europe could double its middle-class job losses.

Some occupations are beneficiaries of the march of technology, such as software engineers and app designers for smartphones and tablet computers. Overall, though, technology is eliminating far more jobs than it is creating.

To understand the impact technology is having on middle-class jobs in developed countries, the AP analyzed employment data from 20 countries; tracked changes in hiring by industry, pay and task; compared job losses and gains during recessions and expansions over the past four decades; and interviewed economists, technology experts, robot manufacturers, software developers, entrepreneurs and people in the labor force who ranged from CEOs to the unemployed.

The AP's key findings:

•For more than three decades, technology has reduced the number of jobs in manufacturing. Robots and other machines controlled by computer programs work faster and make fewer mistakes than humans. Now, that same efficiency is being unleashed in the service economy, which employs more than two-thirds of the workforce in developed countries. Technology is eliminating jobs in office buildings, retail establishments and other businesses consumers deal with every day.

•Technology is being adopted by every kind of organization that employs people. It's replacing workers in large corporations and small businesses, established companies and start-ups. It's being used by schools, colleges and universities; hospitals and other medical facilities; nonprofit organizations and the military.

•The most vulnerable workers are doing repetitive tasks that programmers can write software for — an accountant checking a list of numbers, an office manager filing forms, a paralegal reviewing documents for key words to help in a case. As software becomes even more sophisticated, victims are expected to include those who juggle tasks, such as supervisors and managers — workers who thought they were protected by a college degree.

•Thanks to technology, companies in the Standard & Poor's 500 stock index reported one-third more profit the past year than they earned the year before the Great Recession. They've also expanded their businesses, but total employment, at 21.1 million, has declined by a half-million.

•Start-ups account for much of the job growth in developed economies, but software is allowing entrepreneurs to launch businesses with a third fewer employees than in the 1990s. There is less need for administrative support and back-office jobs that handle accounting, payroll and benefits.

•It's becoming a self-serve world. Instead of relying on someone else in the workplace or our personal lives, we use technology to do tasks ourselves. Some find this frustrating; others like the feeling of control. Either way, this trend will only grow as software permeates our lives.

•Technology is replacing workers in developed countries regardless of their politics, policies and laws. Union rules and labor laws may slow the dismissal of employees, but no country is attempting to prohibit organizations from using technology that allows them to operate more efficiently — and with fewer employees.

Some analysts reject the idea that technology has been a big job killer. They note that the collapse of the housing market in the U.S., Ireland, Spain and other countries and the ensuing global recession wiped out millions of middle-class construction and factory jobs. In their view, governments could bring many of the jobs back if they would put aside worries about their heavy debts and spend more. Others note that jobs continue to be lost to China, India and other countries in the developing world.

But to the extent technology has played a role, it raises the specter of high unemployment even after economic growth accelerates. Some economists say millions of middle-class workers must be retrained to do other jobs if they hope to get work again. Others are more hopeful. They note that technological change over the centuries eventually has created more jobs than it destroyed, though the wait can be long and painful.

A common refrain: The developed world may face years of high middle-class unemployment, social discord, divisive politics, falling living standards and dashed hopes.

'Jobless recovery' a misnomer
In the U.S., the economic recovery that started in June 2009 has been called the third straight "jobless recovery."
But that's a misnomer. The jobs came back after the first two.

Most recessions since World War II were followed by a surge in new jobs as consumers started spending again and companies hired to meet the new demand. In the months after recessions ended in 1991 and 2001, there was no familiar snap-back, but all the jobs had returned in less than three years.

But 42 months after the Great Recession ended, the U.S. has gained only 3.5 million, or 47 percent, of the 7.5 million jobs that were lost. The 17 countries that use the euro had 3.5 million fewer jobs last June than in December 2007.

This has truly been a jobless recovery, and the lack of midpay jobs is almost entirely to blame.

Fifty percent of the U.S. jobs lost were in midpay industries, but Moody's Analytics, a research firm, says just 2 percent of the 3.5 million jobs gained are in that category. After the four previous recessions, at least 30 percent of jobs created — and as many as 46 percent — were in midpay industries.

Other studies that group jobs differently show a similar drop in middle-class work.

Some of the most startling studies have focused on midskill, midpay jobs that require tasks that follow well-defined procedures and are repeated throughout the day. Think travel agents, salespeople in stores, office assistants and back-office workers like benefits managers and payroll clerks, as well as machine operators and other factory jobs. An August 2012 paper by economists Henry Siu of the University of British Columbia and Nir Jaimovich of Duke University found these kinds of jobs comprise fewer than half of all jobs, yet accounted for nine of 10 of all losses in the Great Recession. And they have kept disappearing in the economic recovery.

Webb Wheel Products makes parts for truck brakes, which involves plenty of repetitive work. Its newest employee is the Doosan V550M, and it's a marvel. It can spin a 130-pound brake drum like a child's top, smooth its metal surface, then drill holes — all without missing a beat. And it doesn't take vacations or "complain about anything," says Dwayne Ricketts, president of the Cullman, Ala., company.

Thanks to computerized machines, Webb Wheel hasn't added a factory worker in three years, though it's making 300,000 more drums annually, a 25 percent increase.

"Everyone is waiting for the unemployment rate to drop, but I don't know if it will much," Ricketts says. "Companies in the recession learned to be more efficient, and they're not going to go back."

In Europe, companies couldn't go back even if they wanted to. The 17 countries that use the euro slipped into another recession 14 months ago, in November 2011. The current unemployment rate is a record 11.8 percent.

European companies had been using technology to replace midpay workers for years, and now that has accelerated.

"The recessions have amplified the trend," says Goos, the Belgian economist. "New jobs are being created, but not the middle-pay ones."

In Canada, a 2011 study by economists at the University of British Columbia and York University in Toronto found a similar pattern of middle-class losses, though they were working with older data. In the 15 years through 2006, the share of total jobs held by many midpay, midskill occupations shrank. The share held by foremen fell 37 percent, workers in administrative and senior clerical roles fell 18 percent and those in sales and service fell 12 percent.

In Japan, a 2009 report from Hitotsubashi University in Tokyo documented a "substantial" drop in midpay, midskill jobs in the five years through 2005, and linked it to technology.

Developing economies have been spared the technological onslaught — for now. Countries like Brazil and China are still growing middle-class jobs because they're shifting from export-driven to consumer-based economies. But even they are beginning to use more machines in manufacturing. The cheap labor they relied on to make goods from apparel to electronics is no longer so cheap as their living standards rise.

One example is Sunbird Engineering, a Hong Kong firm that makes mirror frames for heavy trucks at a factory in southern China. Salaries at its plant in Dongguan have nearly tripled from $80 a month in 2005 to $225 today. "Automation is the obvious next step," CEO Bill Pike says.

Sunbird is installing robotic arms that drill screws into a mirror assembly, work now done by hand. The machinery will allow the company to eliminate two positions on a 13-person assembly line. Pike hopes that additional automation will allow the company to reduce another five or six jobs from the line.

"By automating, we can outlive the labor cost increases inevitable in China," Pike says. "Those who automate in China will win the battle of increased costs."

Foxconn Technology Group, which assembles iPhones at factories in China, unveiled plans in 2011 to install one million robots over three years.

A recent headline in the China Daily newspaper: "Chinese robot wars set to erupt."

Where did the jobs go?
Candidates for U.S. president last year never tired of telling Americans how jobs were being shipped overseas. China, with its vast army of cheaper labor and low-value currency, was easy to blame.


But most jobs cut in the U.S. and Europe weren't moved. No one got them. They vanished. And the villain in this story — a clever software engineer working in Silicon Valley or the high-tech hub around Heidelberg, Germany — isn't so easy to hate.

"It doesn't have political appeal to say the reason we have a problem is we're so successful in technology," says Joseph Stiglitz, a Nobel Prize-winning economist at Columbia University. "There's no enemy there."

Unless you count family and friends and the person staring at you in the mirror. The uncomfortable truth is technology is killing jobs with the help of ordinary consumers by enabling them to quickly do tasks that workers used to do full time, for salaries.

Use a self-checkout lane at the supermarket or drugstore? A worker behind a cash register used to do that.

Buy clothes without visiting a store? You've taken work from a salesman.

Click "accept" in an email invitation to attend a meeting? You've pushed an office assistant closer to unemployment.

Book your vacation using an online program? You've helped lay off a travel agent. Perhaps at American Express Co., which announced this month that it plans to cut 5,400 jobs, mainly in its travel business, as more of its customers shift to online portals to plan trips.

Software is picking out worrisome blots in medical scans, running trains without conductors, driving cars without drivers, spotting profits in stocks trades in milliseconds, analyzing Twitter traffic to tell where to sell certain snacks, sifting through documents for evidence in court cases, recording power usage beamed from digital utility meters at millions of homes, and sorting returned library books.

Technology gives rise to "cheaper products and cool services," says David Autor, an economist at MIT, one of the first to document tech's role in cutting jobs. "But if you lose your job, that is slim compensation."

Even the most commonplace technologies — take, say, email — are making it tough for workers to get jobs, including ones with MBAs, like Roshanne Redmond, a former project manager at a commercial real estate developer.

"I used to get on the phone, talk to a secretary and coordinate calendars," Redmond says. "Now, things are done by computer."

Technology is used by companies to run leaner and smarter in good times and bad, but never more than in bad. In a recession, sales fall and companies cut jobs to save money. Then they turn to technology to do tasks people used to do. And that's when it hits them: They realize they don't have to re-hire the humans when business improves, or at least not as many.

The Hackett Group, a consultant on back-office jobs, estimates 2 million of them in finance, human resources, information technology and procurement have disappeared in the U.S. and Europe since the Great Recession. It pins the blame for more than half of the losses on technology. These are jobs that used to fill cubicles at almost every company — clerks paying bills and ordering supplies, benefits managers filing health-care forms and IT experts helping with computer crashes.

"The effect of (technology) on white-collar jobs is huge, but it's not obvious," says MIT's McAfee. Companies "don't put out a press release saying we're not hiring again because of machines."

What hope is there for the future?
Historically, new companies and new industries have been the incubator of new jobs. Start-up companies no more than five years old are big sources of new jobs in developed economies. In the U.S., they accounted for 99 percent of new private sector jobs in 2005, according to a study by the University of Maryland's John Haltiwanger and two other economists.


But even these companies are hiring fewer people. The average new business employed 4.7 workers when it opened its doors in 2011, down from 7.6 in the 1990s, according to a Labor Department study released last March.

Technology is probably to blame, wrote the report's authors, Eleanor Choi and James Spletzer. Entrepreneurs no longer need people to do clerical and administrative tasks to help them get their businesses off the ground.

In the old days — say, 10 years ago — "you'd need an assistant pretty early to coordinate everything — or you'd pay a huge opportunity cost for the entrepreneur or the president to set up a meeting," says Jeff Connally, CEO of CMIT Solutions, a technology consultancy to small businesses.

Now technology means "you can look at your calendar and everybody else's calendar and — bing! — you've set up a meeting." So no assistant gets hired.

Entrepreneur Andrew Schrage started the financial advice website Money Crashers in 2009 with a partner and one freelance writer. The bare-bones start-up was only possible, Schrage says, because of technology that allowed the company to get online help with accounting and payroll and other support functions without hiring staff.

"Had I not had access to cloud computing and outsourcing, I estimate that I would have needed 5-10 employees to begin this venture," Schrage says. "I doubt I would have been able to launch my business."

Technological innovations have been throwing people out of jobs for centuries. But they eventually created more work, and greater wealth, than they destroyed. Ford, the author and software engineer, thinks there is reason to believe that this time will be different. He sees virtually no end to the inroads of computers into the workplace. Eventually, he says, software will threaten the livelihoods of doctors, lawyers and other highly skilled professionals.

Many economists are encouraged by history and think the gains eventually will outweigh the losses. But even they have doubts.

"What's different this time is that digital technologies show up in every corner of the economy," says McAfee, a self-described "digital optimist." "Your tablet (computer) is just two or three years old, and it's already taken over our lives."

Peter Lindert, an economist at the University of California, Davis, says the computer is more destructive than innovations in the Industrial Revolution because the pace at which it is upending industries makes it hard for people to adapt.

Occupations that provided middle-class lifestyles for generations can disappear in a few years. Utility meter readers are just one example. As power companies began installing so-called smart readers outside homes, the number of meter readers in the U.S. plunged from 56,000 in 2001 to 36,000 in 2010, according to the Labor Department.

In 10 years? That number is expected to be zero.

[C-Bolt]

That dang obama wish he quit making all them robots

[Paladin]

Good article and I've read others. The simpletons who say certain politics will make it go away are total fools and liars. Technology is killing this country. And the end is not in sight. Business should recognize that without jobs, heavy unemployment kills their growth prospects. And pure capitalism won't survive if society isn't provided with the opportunities to support their families. The reality is technology may force a heavy intrusion into capitalism because saftey nets won't function without gaining revenue from business that would otherwise provide jobs to tens of millions. A Second French Revolution may be on the way.

[dazed&confused]

Not only are we faced with cleaning up a horrendous recession caused by overextension but now technology renders a huge part of middle-class jobs obsolete. I think we are staring at a return to the CCC type programs to keep folks gainfully employed.

[KVDW]

another good reason to give amnesty to 20 million illegals looking for work. bring'em all in.

[abuck76]

I agree dazed......I think a concerted effort to rebuild our infrastructure ala FDR works programs would turn this economy around in a heartbeat........... :12224

[noreply66]

I agree dazed......I think a concerted effort to rebuild our infrastructure ala FDR works programs would turn this economy around in a heartbeat........... :12224

We need to rebuild a mess of bridges---let us invest in this--just for a start

[YOU'RE TIGER BAIT]

MEXICO

[The Oaf]

MEXICO

I agree to an extent with abuck, sounds like a logical starting point to me.

[kantuckyII]

Bump For Turk

[Xtoxxviii]

Section 1, Bourgeois and Proletarians (Part 2)
The Communist Manifesto
Karl Marx
http://www.sparknotes.com/philosophy/co ... ion2.rhtml

The lower strata of the middle class,
such as tradespeople, gradually sink into the proletariat.
This is due to the fact that they lack sufficient capital,
and the fact that technology has rendered their specialized skills
no longer useful.




Glenn Beck goes the anti technology route as well:
http://www.glennbeck.com/2013/01/25/wom ... art-meter/



Leave it to the SSI collecting, chain smoking atheist immigrant to fall for the side of capitalism and technological progressiveness 

" America's abundance was created not by public sacrifices to the common good, but by the productive genius of free men who pursued their own personal interests and the making of their own private fortunes. They did not starve the people to pay for America's industrialization. They gave the people better jobs, higher wages, and cheaper goods with every new machine they invented, with every scientific discovery or technological advance- and thus the whole country was moving forward and profiting, not suffering, every step of the way."— Ayn Rand

[abuck76]

To use Ayn Rand, a hypocrite herself, shows your lack of overall understanding of the issue......Read what Marx says will happen to Capiatlism and why.........It is happening now........... :12224

[Xtoxxviii]

The hypocrisy  of Rand, Marx or Beck for that matter is not the topic of this conversation. 
"We should start an entire new thread on that. And keeping it on point would be a challenge".

Let's continue to exchange ideas on the evils OR benefits of technology in the economy. I simply just gave 3 different views on the topic.

Personally:
I'm in favor of advanced technology and feel it improves and progresses not only the economy but the human race as well.
Sincerely  I would like to hear your opinion as to why technology does not do this.

This is one of the best threads to come along on this message forum in some time. And this has been an argument of the human race since the invention of the wheel.
 I admit I have a different opinion on the matter then most who frequent this forum.

As a society should we wish to eliminate technology because of those that refuse to progress along with it?

[KVDW]

Read what Marx says will happen to Capiatlism and why.........It is happening now........... :12224

because of self avowed Socialist like you wanting to change it all.

you are like obamy when he said, "we live in the greatest country in the history of the world. come with me and help me change it".

[abuck76]

We do live in the greatest nation............The people built it.......Unions built it.......And you can not see the connection between unions being destroyed, middle class wages dropping, manufacturing jobs gone, CEO wages increasing exponentially and corporate stock and profits up with big money in politics??.....You and your ilk are the ones that are blind, allowing this to happen.........Vote progressive and force this reversal in our way of life............we need leaders like Obama who will bring back common sense of TR, FDR, Truman, Eisenhower Kennedy and Johnson...........Do you see any connection between these guys and our economic success of those times.......We built the interstates, suburbs, factories, built houses, the G.I. Bill, sent people to college ,civil rights, put a man on the moon.................The Progressive Movement is our only hope!!.....Wake up!!!!............ :12224

[Xtoxxviii]

But why is technology and those who create bad for us and the economy?

And as a society should we wish to eleminate technology because of those who wish not to advance along with it?

[abuck76]

Technology through the years is a constant......Always changing, which creates gaps in employment when that technology explodes......the work force takes a while to catch up to those changes......And the economy moves forward...........However, today, the manufacturing base we once had has been destroyed by the owners of production in the name of more profit........ :12224

[Xtoxxviii]

How are you sure we are destroyed and not just in a gap now?

(In theory only here for I never knew a real urchin)
The street urchin was never destroyed he just learned how to pump gas and check oil. That was if he wished to advance with technology.
In spite of corrupt politicians or the profit of the automobile industries.

[abuck76]

I did not say WE are destroyed, but the manufacturing base........The owners of the means of production , before, when a technology explosion happened , would simply retool a factory to do whatever it is that is the current wave of manufacturing or technology............Today our manufacturing base, the infrastructure, the factories themselves have been destroyed.......There will need to be a complete manufacturing renaissance for us to compete globally...........The owners of the means of production have conciously done this........Read what Marx said would ultimately be the downfall of Capitalism..........It is happening today......And it is not the unions doing it, nor the middle class, not any other excuse de jour the right comes up ........ It is the Owners of the means of Production............... :12224

[dazed&confused]

Having posted the original article, I just thought it was an interesting subject. America was a nation where all levels of competence could aspire to a middle class life. Going forward, I do not believe that will be the case. But the upheaval from that will be great. And I don't think you can put the technology genie back in the bottle. To keep social order, we may have people on long-term relief. Unemployment can run for 99 weeks now. If that is rescinded, the economy would go into immediate recession. But we cannot maintain that long term. About the only option IS to have some type of program sponsored by government to keep people in gainful employment.