Wednesday 24 April 2019

Dan O'Brien: 'The robots are coming but they won't push many on to dole queue'

A study claiming that almost half of jobs are at risk of being destroyed has received a lot of media coverage. It is deeply flawed, writes Dan O'Brien

Covers of the German news magazine Der Spiegel
Covers of the German news magazine Der Spiegel

Last week a study by economists at University College Cork speculated that something approaching half of Irish jobs are at risk of being automated away in the years to come. Some towns face an employment apocalypse, it found, with close to six out of 10 existing jobs at risk. The report made for grim reading.

The study got plenty of coverage from a media always ready to fret about the 'rise of the machines'. In this, Ireland and the Irish media are not unusual.

Fears of technological change have always been with us. In ancient Greece, no less a figure than Plato was against one of the most important information technologies ever invented - writing. He believed that once ideas and information were put down on paper, debate would dumb down because nobody would need to go through the mind-flexing process of remembering anything. Plato got a lot right, but he was spectacularly wrong on this. Writing allowed the storage of information, without which complex societies cannot exist.

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Since the time of the Luddites, fears have existed that automation would do away with work. The covers of the German news magazine Der Spiegel going back to the 1960s illustrate this nicely. The most recent cover on the subject - from 2016 - shows how the concerns have spread from blue collar jobs to white collar ones as advances in robotics and artificial intelligence make more repetitive and low-skilled jobs vulnerable to the next phase of automation.

This is what last week's UCC report focused on. The study was worthwhile in trying to identify areas that were most vulnerable to the downsides of technological change. But it had two big weakness. First, it did not examine past evidence of how technology affects overall employment trends. It failed to do this despite mountains of available data.

Second, it speculated only about the future downsides of technological change for jobs, with hardly a hint of all the new jobs that could be created thanks to innovation. Its focus, almost exclusively on job losses that could arise from change, will only compound fears that the future is bleak for workers. If a report on immigration focused only on the downsides of that phenomenon it would rightly run the risk of being labelled fear-mongering. Scholars should enhance public understanding of complex phenomena. The UCC report did the opposite.

As it happens, last week saw the publication of the latest jobs figures from the Central Statistics Office which provided lots of the sort of hard evidence that should have been used in the UCC report.

Although the numbers showed employment growth slowing throughout last year, each quarter recorded fresh high-water marks in the total number of jobs in the country. Put another way, there have never been so many people at work in Ireland. That has happened despite the proliferation of automation and the growth in applied artificial intelligence. It has also happened despite much greater competition from low-wage economies which caused many lower-paying jobs - in textiles and shipbuilding, for instance - to move away from the rich world.

While Ireland has done particularly well from the big trends in technology and globalisation, it is not exceptional. Employment is at record levels across the EU. It is at record levels in the US, Canada, Japan, Australia and New Zealand. In fact, almost every advanced country has seen a continued upward trend in employment over the decades. As this column has written quite a few times over the years, claims about swathes of people being "left behind" in a changing world of work are to be heard frequently, but little evidence to support them is to be found where it counts - in the labour market data from across the rich world.

None of this is to say that change does not cause disruption. Nor is it to say industries and sectors don't decline. Take Irish agriculture. It used to dominate employment. But a whole range of factors have changed it. Among other things, that has meant that the back-breaking (and low-productivity) farm labouring which so many generations of our ancestors spent their lives doing is no longer done manually. Tractors, muck spreaders and harvesters; and the (partial) automation of milking and slaughtering have contributed to the decline in farming-related jobs. But - and this is crucial - they have not resulted in ever-rising mass employment across the island.

Most of the shake-out in agricultural employment happened in the last century. Over the past 15 years the numbers working in farming, as well as forestry and fishing, have been largely stable, at a little over 100,000. Despite this, the UCC report claims that "many jobs will be automated in agriculture". Given that there aren't so many jobs left in the sector - it accounts for just 4pc of total employment when fishing is included - there are not so many jobs to be lost even if robots are invented to milk cows.

Nor is it the case that everyone who loses a job in one sector ends up jobless for the rest of their life. People and economies are dynamic. Opportunities are always opening up. Individuals and businesses are constantly seeking to make the most of them. The truth is most people want to work, better themselves and contribute. They will not be passive and idle as technology changes.

This is to be seen - yet again - in the hard data. In 2016 the number employed in the information and technology sector surpassed those in the agricultural sector. The 'spud-to-chip' transformation of the economy is just one piece of hard evidence that raises questions about last week's doom-laden speculations from UCC.

Another is what's actually happening to the kind of jobs that the report identifies as among the most vulnerable to automation. What statisticians describe as 'administration and support services activities' are just the kind of jobs that clever machines could do. But instead of disappearing, they are surging.

In the final quarter of last year the number employed in that sector surged by 13pc over the same period a year earlier. That was by far the most rapid rate of growth by sector. It also brought employment in this supposedly dying industry to an all-time high.

In one of the few acknowledgements of how well Ireland has adapted to the changes, the UCC report states that "in the past two decades, Ireland experienced one of the most substantial transitional change shifts of middle jobs to higher skilled jobs in the OECD".

This is of course true. Ireland has the most educated population in Europe. Almost half of people aged under 65 have a third level qualification and this continues to rise. Ireland also has one of the lowest levels of low educational achievement among adults in Europe, and that share is also still going in the right direction.

There is a lot that could go wrong for this country. Within weeks a no-deal Brexit could plunge the country back into recession and cause unemployment to soar. A trade war with the US could do the same. A return of crisis in the euro area could also lead to a slump in Ireland. There are plenty of things to worry about. An automation apocalypse is not one of them.

  • Twitter: @danobrien20

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