My local CVS now has automatic checkout machines. We are supposedly going to receive Amazon deliveries by drone any day now. And robot restaurants have arrived.
Technophiles love to remark that the hourly jobs will soon disappear as those positions become replaced by automation.
Yet a recent article by MIT Labor Economist David Autor, aptly titled “Why are there still so many jobs?” reviews data both in favor and against the proposed decline of workforce demand. While the outlook for hourly jobs such as retail, hospitality, construction, health care and food is mixed, Autor makes a strong case that these jobs aren’t going anywhere anytime soon.
For one thing, data shows that wages for low-skilled jobs have increased faster than any other percentile in the past decade. While Times contributor Brittany Bronson has dexterously argued that low-skilled is a bogus definition, they are identified as such in Autor’s article. Autor shows that wages for those jobs have risen over time faster than any other skill-level jobs. By contrast, wages at the highest skillset rose the fastest in the 70s.
Technology’s effect on productivity
Why might this be happening? The biggest reason is that technology increases employee productivity, and so each employee can do more. Does that mean the hourly workforce will shrink? Perhaps, but as employee productivity increases, it’s also more profitable to hire more people. Maybe technology enables home care workers to treat more patients at once, increasing the demand.
Technology might change who gets hired as we now need people who can operate these new technologies. House of Cards watchers will remember the scene in Season 1 where Claire, having just laid off her older staff, is in a coffeeshop where a woman in her 50s working the counter struggles to operate a tablet-based cash register. Will the arrival of technology to hourly jobs make non-tech-savvy people essentially unemployable? Not really.
As technology advances, it also becomes much more user friendly. Eventually, it will be intuitive to use a tablet-based cash register for everyone – much more so than original cash registers were. However, in the meantime, people who are more able to learn to use new technologies quickly will be better hires for hourly jobs. This doesn’t mean that an ideal hire is someone who is more tech savvy from day 1, but rather that the ideal hire is someone willing to learn new things and undertake new challenges.
Technology will also change the daily tasks for hourly workers. As my local CVS implements automatic checkout machines, former cashiers problem solve when the machines freeze (which happens far too often). Ideal employees are now problem solvers able to deal with frustrated customers. These require different skillsets than those of a typical cashier.
Technology is changing our workforce across the board, and the rate of change is faster than it has ever been. But concerns that it will eventually replace our hourly workforce are unfounded. Firms that hire hourly workers will be wise, however, to consider how their ideal hire will change as they adopt more technology.
Sara Nadel is Co-Founder and Co-CEO of StellarEmploy.