January 23, 2013

All over the world, technology replacing employees

Technological advances mean many jobs lost in the recession are gone for good, while those that have come back pay less.

The Associated Press

NEW YORK – Five years after the start of the Great Recession, the toll is terrifyingly clear: Millions of middle-class jobs have been lost in developed countries the world over.

Rosser Pryor
click image to enlarge

n this Jan. 15, 2013, photo, Rosser Pryor, Co-owner and President of Factory Automation Systems, sits next to a new high-performance industrial robot at the company's Atlanta facility. Pryor, who cut 40 of 100 workers since the recession, says while the company is making more money now and could hire ten people, it is holding back in favor of investing in automation and software. (AP Photo/David Goldman)

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And the situation is even worse than it appears.

Most of the jobs will never return, and millions more are likely to vanish as well, say experts who study the labor market. What's more, these jobs aren't just being lost to China and other developing countries, and they aren't just factory work. Increasingly, jobs are disappearing in the service sector, home to two-thirds of all workers.

They're being obliterated by technology.

Year after year, the software that runs computers and an array of other machines and devices becomes more sophisticated and powerful and capable of more efficiently performing tasks that humans have always done. For decades, science fiction warned of a future when we would be architects of our own obsolescence, replaced by our machines; an Associated Press analysis finds that the future has arrived.

"The jobs that are going away aren't coming back," says Andrew McAfee, principal research scientist at the Center for Digital Business at the Massachusetts Institute of Technology and co-author of "Race Against the Machine." "I have never seen a period where computers demonstrated as many skills and abilities as they have over the past seven years."

The global economy is being reshaped by machines that generate and analyze vast amounts of data; by devices such as smartphones and tablet computers that let people work just about anywhere, even when they're on the move; by smarter, nimbler robots; and by services that let businesses rent computing power when they need it, instead of installing expensive equipment and hiring IT staffs to run it. Whole employment categories, from secretaries to travel agents, are disappearing.

"There's no sector of the economy that's going to get a pass," says Martin Ford, who runs a software company and wrote "The Lights in the Tunnel," a book predicting widespread job losses.

The numbers startle even labor economists. In the United States, half of the 7.5 million jobs lost during the Great Recession paid middle-class wages, ranging from $38,000 to $68,000. But only 2 percent of the 3.5 million jobs gained since the recession ended in June 2009 are midpay. Nearly 70 percent are low-paying jobs.

In the 17 European countries that use the euro as their currency, the numbers are even worse. Almost 4.3 million low-pay jobs have been gained since mid-2009, but the loss of midpay jobs has never stopped. A total of 7.6 million disappeared from January 2008 through last June.

Some occupations are beneficiaries of technology, such as software engineers and app designers for smartphones and tablet computers. But, overall, technology is eliminating far more jobs than it is creating.

To better understand the impact of technology on jobs, The Associated Press analyzed employment data from 20 countries; and interviewed economists, technology experts, robot manufacturers, software developers, CEOs and workers who are competing with smarter machines.

The AP's key findings:

• Over the past 50 years, technology has drastically reduced the number of jobs in manufacturing. Robots and other machines controlled by computer programs work faster and make fewer mistakes than humans. Now, that same efficiency is being unleashed in the service economy.

• Technology is being adopted by every kind of organization that employs people. It's replacing workers in large corporations and small businesses, established companies and startups, schools, hospitals, nonprofits and the military.

• The most vulnerable workers are doing repetitive tasks that programmers can write software for -- an accountant checking a list of numbers or a paralegal reviewing documents for key words to help in a case.

(Continued on page 2)

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