Digital

Article

Innovation

Manufacturing Jobs and

the Rise of the Machines
The story of whether robots are eating our jobs is an important one. But
who’s telling it correctly? by Andrew McAfee

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 HBR / Digital Article / Manufacturing Jobs and the Rise of the Machines

Manufacturing Jobs and the

Rise of the Machines
The story of whether robots are eating our jobs is an important one. But
who’s telling it correctly? by Andrew McAfee
Published on HBR.org / January 29, 2013 / Reprint H00A22

The story of how technological progress is affecting employment

— whether, in other words, the robots are eating our jobs — is
clearly an important one. But who’s telling it correctly? I believe that
technological unemployment (and underemployment) is a real and
growing phenomenon.

But since Erik Brynjolfsson and I appeared on 60 Minutes in January

for “March of the Machines,” a story that examined the labor force
implications of advanced digital technologies like robots and other
forms of automation, we’ve been accused of being unclear on the
concept.

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For example, the Association for Advancing Automation said in

response that we “are missing the bigger picture” by not recognizing
that American companies are “successfully implement[ing] automation
technologies instead of going out of business or sending manufacturing
overseas.” They add: “American manufacturing’s embrace of robotics
will ensure a new manufacturing renaissance in this country.”

If the A3, or anyone else, thinks that lots more manufacturing jobs will
accompany this renaissance, they’re just dead wrong. The facts are too
clear, and they all point in the other direction. For example:

• Manufacturing employment has been on a steady downward trend

in the U.S. since 1980 (it increased some after the end of the Great
Recession, but this boost appears to be leveling out).
• Manufacturing jobs have also been trending downward in Japan and
Germany since at least 1990 and, as I wrote earlier, in China since 1996.
• Manufacturing employment decline is a global phenomenon. As a
Bloomberg story summarized: “Some 22 million manufacturing jobs
were lost globally between 1995 and 2002 as industrial output soared
30 percent. … It seems that devilish productivity is wreaking havoc
with jobs both at home and abroad.”

Rob Atkinson, president of the Information Technology and Innovation

Foundation, is another of our detractors. He takes the argument up a
level across industries. Even if total manufacturing employment goes
down because of automation, he writes, other industries will pick up the
slack by employing more people. This is because:

“…most of the savings [from automation] would flow back to

consumers in the form of lower prices. Consumers would then use the
savings to buy things (e.g., go out to dinner, buy books, go on travel).
This economic activity stimulates demand that other companies

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(e.g., restaurants, book stores, and hotels) respond to by hiring more

workers.”

Fair enough, but what if those other companies are also automating?
One of the most striking phenomena of recent years is the
encroachment of automation into tasks, skills and abilities that used
to belong to people alone. As we document in Race Against the Machine,
this includes driving cars, responding accurately to natural language
questions, understanding and producing human speech, writing prose,
reviewing documents and many others. Some combination of these will
be valuable in every industry.

Previous waves of automation, like the mechanization of agriculture

and the advent of electric power to factories, have not resulted in large-
scale unemployment or impoverishment of the average worker. But the
historical pattern isn’t giving me a lot of comfort these days, simply
because we’ve never before seen automation encroach so broadly and
deeply, while also improving so quickly at the same time.

I don’t know what all the consequences of the current wave of digital
automation will be — no one does. But I’m not blithe about its
consequences for the labor force, because that would be ignoring the
data and missing the big picture.

This article was originally published online on January 29, 2013.

Andrew McAfee is the cofounder and co-director of the MIT

Initiative on the Digital Economy and the inaugural visiting fellow
in Google’s Technology and Society group. He is the author of the
new book, The Geek Way, and coauthor with Erik Brynjoflsson of The
Second Machine Age.

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