Sal Guatieri looked at the consequences of robots and automation on wages using data from the U.S. and the OECD.
Hourly wages per hour in the U.S. grew “smartly” in 2015, he wrote, but since then it has “barely kept pace with progress.”, Colorado and North Dakota, he transcribed, have “some of the lowest jobless rates and lowest wage increases in the country.”
Wages could still grow, Guatieri said.
But he went on to say that the national jobless rate only hit 4.3 percent or less double in the last 50 years: first, between 1965 and 1970, and second, between 1999 and 2001.
The cost of labor went up in both of these times.
But now, “new automation is running its way up and down the skills’ chain,” and threatening more jobs than it used to.
Earlier, robots threatened jobs in industries such as manufacturing, transportation, office support, and retail.
Now, they’re inching into tasks that require thinking.
Artificial intelligence, he said, can examine big data and write analytical reports – a skill that’s key in areas such as financial planning, economics, and journalism.
And it may not be long ahead it costs less to have a machine do certain jobs than it would pay a worker.
A 2015 report titled “The Robotics Revolution” by the Boston Consulting Group (BCG) pegged the hourly cost of a “generic” robotics system in production at around $28 per hour at the time.
By 2020, just three years from now, that cost could fall to about $20 per hour, which is “below the average human worker’s wage,” the report said.
There are, of course, other determinants that could be keeping wages from growing — some industries that aren’t as technology-intensive are also seeing modest pay increases.
But “the adverse impact on wages could grow as more tasks are automated,” and labor shortages might “encourage U.S. companies to invest more in technology,” Guatieri wrote.
What the OECD says
The report came two days later the OECD released its 2017 Employment Outlook.
The organization showed that the middle-skilled share of employment in all represented nations fell by 9.5 percentage points between 1995 and 2015, a trend that has been driven by technological changes, it said.
As middle-skilled jobs have fallen, high-skilled jobs grew by 7.6 percentage points and low-skilled jobs grew by 1.9 percentage points in the same time frame.
The polarization is happening because jobs have shifted from production to service positions, a trend that has seen employees forced to take on lower-paying work.
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