Newly published MIT research shows the impact of automation on less educated workers. According to Daron Acemoglu, a professor of Labor Economics at MIT, automation hasn’t really increased productivity much. Instead, it has shifted the need for labor among low-skill workers. The authors call this “task displacement.” The findings could help community colleges recruit students for whom automation poses a threat to their income.
Acemoglu points to automation like self-checkout stands at grocery stores. By shifting the work of ringing up goods to an automated kiosk (and to the shoppers themselves), the stores haven’t increased productivity. Instead, they simply reduce their need for low-skill labor.
The self-checkout kiosk is only one example of labor shifting, according to Acemoglu, who co-authored the study with Pascual Restrepo, an Assistant Professor of Economics at Boston University. Automation has consumed low-skill jobs in a wide range of industries, including call centers, manufacturing, and even food service.
While automation replaces low-skill workers, it also impacts worker pay. According to Acemoglu and Restrepo, earnings among men with graduate level degrees have risen by more than 60% in the past three decades. During the same time, the earnings of men who never completed high school have dropped by 15% after adjustment for inflation. Of that decline, the authors determined that automation was responsible for more than half (8.8%) of it. Automation has also had a negative effect on the wages of women who never earned a high school diploma. It lowered their wages by 2.3%. At the same time, automation accounted for 80% of the rise in wages among college educated people.
The authors conclude that rapid automation has had a profound impact on changes in the US wage structure. Where automation has replaced low-skill workers, it primarily benefits the corporation without changing productivity.
Community colleges must be prepared
There is a difference between technological improvements that increase productivity, efficiency and/or worker safety and those that simply displace low-skill workers. Because “task displacement” automation has a positive effect on an employer’s bottom line, this kind of automation is not likely to go away anytime soon.
The authors controlled their findings for a number of other factors that might possibly impact wages. Automation was clearly a heavyweight in terms of impact, and a person’s educational attainment determined whether that impact was positive or negative.
In Southeast Michigan, automation is a fact of work life for many people. Community colleges can help affected workers rewrite their script, and help endangered, low-skill workers recognize the danger that automation poses to their positions.
But of course, that relies on community colleges themselves being prepared to train workers for high-skill, high-wage positions. It means they’ll need to understand the automation landscape better than they do right now, and start working more for the long-term benefit of the community and less for the short-term benefit of individual employers.
Photo Credit: Scott Lewis , via Flickr