Well, there will ALWAYS be jobs for some, but as time goes by clearly there will be fewer.

The reason there will be fewer is due to something most of us normally think of as good: efficiency.

The signs are everywhere: the Post Office is overstaffed due to so much of what used to be done in snail mail being done online: we don't send letters by mail. No longer do we pay most bills by mail; we do it online or over the phone. And the rub is that we don't even pay for those services because we'd have Internet or phone service anyway, and when you're not paying, you're not subsidizing someone's employment.

Largely automated systems have eliminated many jobs. Craigslist has so few employees (about 25 as I understand it) that it almost runs on autopilot (ever wanted to talk to their customer service? don't bother: it really doesn't exist for any practical purpose). Think of all the employees of newspaper classified ad departments who no longer have jobs, and the revenue lost to those newspapers, which has forced some out of business, adding to unemployment, forcing the rest to cut back drastically on staff.

When I was young (I'm 65) automobiles and trucks were built by people on assembly lines. The only mechanical assistance was probably a small lift to lift heavy objects like motors, but the lift was still operated by a person. Today, the amount of actual human later going into the building of a car on assembly line is greatly limited, with much of the work being done by industrial robots.

One can only expect that this trend will continue because we will always want products to be cheaper.

So, as fewer and fewer people have jobs, who will be out there to buy them? If you stop to think about it, the trend is rather obviously unsustainable!

We can't continue to let the numbers of the unemployed to expand. At some point, the economy will become totally dysfunctional.

How do you think we will have to deal with this eventually.

Tags: efficiency, unemployment

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"Well, there will ALWAYS be jobs for some, but as time goes by clearly there will be fewer."

This is an assumption without basis in fact. Without pointing out the hundreds of millions of jobs created the last decade or so in emerging markets, the total employment level in the US decreased only slightly from the 03-2007 peak of 146.3m to the current level of 142.4m. The US does have major cyclical issues related to the economy which the government is unable/unwilling to fix, and some structural issues which should be fixed. In any event, history shows that there will always be a growth in the number of jobs despite setbacks, this is the June employment number since 1948 recovered from BLS:

As time goes by the health care sector will swallow large chunks of the labor pool and make up for losses in other semi-skilled positions.

"The reason there will be fewer is due to something most of us normally think of as good: efficiency."

The increase in efficiency is not something new and has been one of the most important drivers (combined with extensions of the labor pool to include i.e. women). It has also stagnated substantially lately, with output per hour down from a growth rate of 2-2.7% in the '95-'10 time frame to 0.7% in '11. As resources are scheduled to flow into the ed-med sectors in which there is little or negative productivity growth (see Baumol's disease), more workers will be required.

"The signs are everywhere: the Post Office is overstaffed"

It's not really overstaffed, but the staffing is a result of certain requirements of delivery service (boondocks and weekends) which are uneconomical in a business sense. However, the socio-economic gain of having a full fledged postal service is higher than the business gain, and a choice of whether or not to subsidize must be made. The causes you point to for the post office demise are correct.

"Largely automated systems have eliminated many jobs."

This is true, and perhaps the greatest example is the tractor and other modern farm/primary sector equipment which has reduced the number of people employed from around 80% of the population 100 years ago to 2-4% these days. Yet other employment opportunities arose, first in the secondary sector, then into the tertiary sector, and today into what some dub the 'quaternary sector'. While it is true, it isn't something negative as people generally find other jobs in the medium term, technology killed off both the horseshoer and ice cutters without too many tears being shed.

"How do you think we will have to deal with this eventually."

Firstly, to avoid having large numbers of un-/under-/malemployed there needs to be flexible structural (laws, regulations, customs) policies. In most countries, especially southern Europe, hiring and firing must be streamlined to avoid labor market sclerosis. In the US, more risk needs to be shifted to employers to ensure that they optimally retain, train, and develop their human resources. I would also substantially increase the minimum wage as this mostly affect the non-tradable sector and can produce a substantial boost in demand which would outweigh any reduction in employment. There are many good labor market policies which can be put in place to increase employment and growth (reduction/increase of work week, changes to mandated vacation, corporate tax relief for new hires, dividend sharing, etc).

Secondly, there needs to be actions to deal with the cyclical downturn currently experienced. The two ingredients are monetary policy, entailing a reduction in interest rate and increase in money supply to deal with the supply side, and fiscal policy, entailing government consumption/investment to weigh up for lacking demand side. Since monetary policy now is more or less spent, the governments that can borrow at a low rate will at some point have to turn to fiscal policy to resolve the economic slowdown. Since it's the right thing to do, I expect that every other opportunity will be tried first and that we'll probably see the end of this crisis in 5-8 years.

One thing missing from your analysis ("Without pointing out the hundreds of millions of jobs created the last decade or so in emerging markets, the total employment level in the US decreased only slightly from the 03-2007 peak of 146.3m to the current level of 142.4m.") is that I believe you have left out the huge numbers of people who have stopped looking for work in any serious way and are having to get by on charity, welfare programs, and food stamps.

Also, tech jobs aren't for everybody, and the trend is for an increasingly greater number of jobs to be in the technology fields which tend to be calculation-intensive. Even though computers do most of the calculation anymore, you still need to know how to do it yourself in principle so that you can set the calculations up properly.

Taking myself as an example: I have no talent for mathematical calculation. Any mathematical calculation beyond basic algebra makes my eyes glaze over. On the other hand, I'm a wiz at non-calculational math of a conceptual nature: geometry and topology.

No, that is the total number of employed people, so there aren't that many jobs lost (2.7% fewer jobs now since last peak). On the other hand, employment-to-population ratio is very low, the lowest since the mid seventies (before the whole scale entrance of women into the workforce, essentially). Partially this is due to demographic factors (more elderly), and partially due to increased unemployment and nonemployment (a term sometimes used for those not seeking employment, aka discouraged workers).

The technology driven workplace and specialization is an issue as labor cannot shift tracks too often, especially in a country where 1 in 5 is a functional illiterate. Some countries alleviate this by mandatory labor training for the unemployed (usually unsuccessfully) and strengthen education. This is working with the structural issues I was mentioning, which is a long term project. However, there are still plenty of jobs which doesn't require advanced skills beyond at most a couple of years on the job training and perhaps night classes (pretty much the whole service industry, construction, low level healthcare positions, data entry, security, etc). The problem with these positions in the US is that they are paid so little that social mobility becomes virtually impossible, the next generation will suffer from the exact same problems.

It is not always about the technology. The culture of work has become slightly different over my labor history. At one time, right out of school, my education matched my job prospects, and I had several job offers because of it. As I have completed more education, now I seem, atleast on paper, to be 'over qualified'. It got so bad that I gave up trying to find anything do do, working for other people, and started a contracting business. This worked for about 5 years, then the economy took a nose dive. So here I am, unemployed since February, puttering around the house. About May, I started getting calls again for work, but I had to turn them down because in the last 9 months before, I did not have enough work to cover my liability insurance, bond, and state mandated ongoing education! 

So we have a nice garden now. I started to fix our house again, and have started to return to hobbies that 'might' generate an income, sooner or later.

Last friday, I made a proposal to a retired local prof. about a bioremediation project I would like to work on concerning Selenium contamination. After my meeting, talking for a few hours, I realized that he did not have any money either! I might be able to trade time for equipment access if I am lucky! Atleast the microbial fuelcell I have been puttering with works, and could be retasked for bioremediation on scale up.

As a friend on mine told me years ago, 'a cadilac mind in an edsel environment...', atleast it had lots of buttons....

While some think having a more efficient society and thus less to do is a great thing, psychologically people can't thrive without something to do, without feeling like a participant in some worthwhile project. It's not just about making money and eliminating backbreaking or dangerous work. Sending people welfare and food stamps for the "job" of being unemployed doesn't develop anyone. Of course, a few will become artists or writers or volunteers, but for many it's a psychological death sentence.

worst case scenario, if everyone in the world is too bored and well-off, we'll hire half of them to dig ditches and the other half to fill them in :P

I feel that to create more jobs in this ever effecient oriented country of ours, we must revamp our education system. Create and expand more colleges and universities and make it so that the government pays for a good deal of students' tuitions. We also need to encourage more private doners to not only create more scholarships, but also make them more competative. Most importantly though, we need university and college faculty to really create an environment that encourages innovation and engineuity, our colleges need to make leaders instead of drones just absorbing the information that they hear in a professor's lecture hall. Creativity and courage must be promoted for our country to be on top again.

@Simon Stepho - I'm sorry to say, Simon, that although you idea seems intuitively right, a recent study suggests that it is actually the problem: http://www.theatlantic.com/business/archive/2012/07/the-big-jobs-my...

I think an educated populace is such an asset in so many ways, that I'm astonished that education from top to bottom through graduate school isn't free. I also think that anyone going for any advanced degree should be required to have a thorough grounding in the liberal arts. I think this investment would result in a more competitive as well as a more humane country whether the student graduates with a doctorate in English or Engineering.

@Unseen

You would be a very popular man here in Québec with such ideas - what with all our student protests over tuition rates.  I happen to like your idea in terms of idealism.  On the other hand, we need a lot more people willing to just work, get it done, push it through, make it happen - I've had enough of people who spend all day 'thinking it through'.

Communism. Imagine a world where robots do the vast majority of manual labour and humans do whatever work they are able to do and all for the good of the society instead of the individual. There would be no need to pay for cars because the robots would mine and process the metals and build the cars. Humans would program the robots and probably design the cars being built. Why would those humans work for free? free food(and other essentials) produced by robots, for society.

When I was young (now), I grew terribly disillusioned by the current system of democracy and capitalism. If society itself is like a machine, capitalism is each of the components of the machine all working to take of itself. It works, but if each component took care of the machine as a whole, the individual components wouldn't need to work so hard... OK, that was a strange analogy for communism.

Ah, the Communist dream of "From each according to his abilities, to each according to his needs." Why is it, though, that every Communist country so far has turned out to be a dictatorship of some form or other, so insecure that the can't tolerate truly free elections where they might have to compete against other political parties?

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