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The Robots are Coming for Your Job-Part II…Plus, the 10 Fastest Job Growth Areas
Is the increasing automation of our economy a threat to American wages and jobs? Should the American worker fear the rise of the robots? Some say “No, not really.” But what does history say? It says Artificial Intelligence is here now and could soon wipe out 50 percent of our jobs!
Eighty years ago, John Maynard Keynes warned that society faced “a new disease” of “technological unemployment” in which the “means of economizing the use of labor [were] outrunning the pace at which we can find new uses for labor.” Much more recently, Michael Strain of the American Enterprise Institute wrote about how “robot workers could tear America’s social fabric.” Strain worries that machines could eliminate the livelihoods of millions of less-skilled workers.
These fears are misplaced. In reality, technological advances will improve living standards and working conditions for the vast majority of Americans…or so they say.
Business Insider forecasted a loss of 7 million jobs to the robots by 2018, while the World Economic Forum predicts the same amount, but by 2020. Further, WEF expects that 2 million jobs will be recovered so as to support the robotic industry, therefore resulting into 5 million net loss in jobs.
"At some point in the future or though not, in my view, for a long time a GEICO as premium volume may shrink because of driverless cars," Warren Buffett (Trades, Portfolio) (p. 24 of Berkshireas annual report).
As the Oracle of Omaha had pointed out, job employment in car manufacturing would not be the only one placed at risk. Car insurers are to be threatened, too. With less human error in the equation along with possible all-around chauffeur leasing services that would be "cheaper" (I'm forecasting here), there would be less demand for premium insurance deals accompanied by fewer car purchases.
Buffett’s GEICO insurance business, which primarily is involved in car insurance business, had been a cash machine and has been contributing well to his float.
General Motors (GM) reduced its employees by 23%, from 2006 to 2015.
Interestingly enough, car manufacturers in the U.S. had reduced its employee count more when compared to emerging markets Asia and the European car manufacturers. With more technology coming online, observing the American car manufacturers contribution to hiring labor force would be interesting.
The coming gales of creative destruction are unavoidable, coming from 3-D printing, automation, drones, driverless vehicles , etc. [roughly one of every 12 males in America are employed driving a vehicle]. Consider further these examples:
>Construction robots are turning out automated bricklaying devices called SAMs, an acronym for semi-automated masons.
>Greg Creed, CEO of Yum Brands, which owns Taco Bell, KFC, Pizza Hut, etc. told CNBC he expects that by “the mid-2020s” automation will take the place of most food-service workers.
>By 2019 some 31 million household robots will be working in homes, performing domestic tasks and even offering ‘companionship’ [human-like sex dolls are already hot sellers in Asia and Europe].
>An estimated 13% of all legal work will soon be done via automation.
>Last October, Uber used an automated 18-wheeler to deliver 50,000 cans of Budweiser [another non-US firm] from Fort Collins to Colorado Springs, CO…the driver spent most of his time in the sleeper cabin monitoring the system’s performance.
As I had written in part one, most banks are downsizing the number of tellers they use and enhancing their ATMs though some statistics dispute this number saying branch offices and tellers actually increased. This is true primarily due to increases of population and growth in such areas as Phoenix, AZ which has more than doubled in size in the past decade or two.
Former Treasury Secretary Larry Summers gave a pessimistic assessment in the Financial Times, where he stated that, “It is widely feared that half the jobs in the economy might be eliminated by innovations, such as self-driving vehicles, automatic checkout machines and expert systems that trade securities more effectively than humans can.”
It is true that several studies have found about half of all US jobs are vulnerable. Some researchers have taken pains to point out that because your job is at risk doesn’t mean you will actually lose it…it simply means you will perform them differently.
What most fail to point out in order to fulfill the jobs of the future, math and science skills will be required and most Americans do not have these skills – in fact, despite an all time demand for high tech and skilled jobs, employers cannot fill these slots because we don’t have enough skilled labor…we fall far short in training students in math and science and employers often must retrain new employees.
With U.S. tuitions [even fed by federal loans] already spiraling out-of-control we should be rethinking our outmoded degree programs which produce outmoded and often useless college programs. The US currently spends only about 0.1 percent of its GDP on programs designed to help people adjust to employment disruptions – and that funding has actually declined over the past three decades, even as automation was on the rise thanks to poor decision making by Democrats in power.
New jobs that pay well require math literacy and currently, upwards of 30 percent of American students cannot pass high school algebra; the United States now ranks 31st out of 35 advanced economies! [High schools and universities are too busy offering safe spaces, banning free speech and getting rid of library books].
Apparently, parents are going into debt so there children can have a useless degree and continue living at home while graduating with huge tuition loans…
As I pointed out in last week’s post…back in the mid-1980s GE began the wave of off-shoring U.S. jobs which ultimately drove down wages even further and I asked in nationally published column I wrote then how minimum wage workers would be able to buy $40K autos? [We know today they cannot…they lease or they are “upside down” in seven year car loans!]
Back in 1992, the bottom 90 percent of American income earners brought in more than 60 percent of the country’s income. But last year that figure slipped to just 49.7 percent. The wealth of our society is increasingly being concentrated at the very top, and the middle class is steadily being eroded. Surveys have found that somewhere around two-thirds of the country is living paycheck to paycheck at least part of the time, and so living on the edge has become a way of life for most Americans.
Earlier today, I came across a Business Insider article that was bemoaning the fact that the U.S. economy seems to be rather directionless at this point…
- We do not have a real plan for health care, and costs continue to gobble up American wages.
- We do not have a plan for dealing with globalization and economic change, but that change continues to shape our economy.
- We don’t have a plan to update our decrepit infrastructure.
· Business Insider article did make a great point about globalization. Most people don’t realize that our economy is slowly but surely being integrated into a global economic system. This is really bad for American workers, because now they are being merged into a global labor pool in which they must compete directly for jobs with workers in other countries where it is legal to pay slave labor wages.
· Even down in Mexico, many autoworkers are only making $2.25 an hour…
· Most of the workers at the new Audi factory in the state of Puebla, inaugurated in 2016 and assembling the Audi Q4 SUV, which carries a sticker price in the US of over $40,000 for base versions, make $2.25 an hour, according to the Union.
· Volkswagen, which owns Audi, started building Beetles in Puebla in 1967 and has since created a vast manufacturing empire in Mexico, with vehicles built for consumers in Mexico, the US, Canada, and Latin American markets.
· Volkswagen, Ford, GM, or any of the global automakers, which can manufacture just about anywhere in the world, always search for cheap labor to maximize the bottom line.
· Would you want to work for $2.25 an hour?
· Over time, millions of good paying jobs have been leaving high wage countries and have been going to low wage countries. The United States has lost more than 70,000 manufacturing facilities since China joined the WTO, and this is one of the biggest factors that has eroded the middle class.
· In a desperate attempt to maintain our standard of living, we have gone into increasing amounts of debt. Of course our federal government is now 20 trillion dollars in debt, but on an individual level we are doing the same thing. Today, American consumers are over 12 trillion dollars in debt, and it gets worse with each passing day.
· The borrower is the servant of the lender, and most Americans have become debt slaves at this point. This is something that Paul Craig Roberts commented on recently…
· Americans carry on by accumulating debt and becoming debt slaves. Many can only make the minimum payment on their credit card and thus accumulate debt. The Federal Reserve’s policy has exploded the prices of financial assets. The result is that the bulk of the population lacks discretionary income, and those with financial assets are wealthy until values adjust to reality.
· As an economist I cannot identify in history any economy whose affairs have been so badly managed and prospects so severely damaged as the economy of the United States of America. In the short/intermediate run policies that damage the prospects for the American work force benefit what is called the One Percent as jobs offshoring reduces corporate costs and financialization transfers remaining discretionary income in interest and fees to the financial sector. But as consumer discretionary incomes disappear and debt burdens rise, aggregate demand falters, and there is nothing left to drive the economy.
Today’s fastest growing occupations include computer/network security, computer gaming, dating services, entertainment and gourmet cooking…how enriching?! In my opinion, we need a country which is productive, one that aims to repair its infrastructure, its power grid, making this nation self sufficient…but my opinion seems to be in the minority any more.
A gift for you to help you survive...How to Survive the War on the Middle Class
14 of the best reports I’ve assembled on protecting your freedom…Here is the download link.
What about you? Got anything interesting to share?
Bruce, the Poor Man, free thinker, social critic & cynic
A Final Note…
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Google for Jobs – New
Recently launched this new feature enables you to find the position you want by showing you openings from multiple job boards and recruitment sites all in one place. Visit Google.com and type in the title of the position you desire, the word ‘jobs’ and where you are looking such as Marketing Director jobs in Cleveland, OH. You’ll get a list of openings that match your search request.
10 Jobs With the Fastest Wage Growth Today
Some of the jobs seeing the fastest wage growth are also among the lowest-paying. But a few key fields provide both higher pay and decent growth.
If you’ve browsed job boards anytime in the last few years, you know employers have one common love: the bachelor’s degree. Regardless of the field, it seems like no one can get a decent job anymore without toiling away four or five years for that piece of paper.
Don’t worry. We’ve been keeping an eye out for you. Here are some high-paying jobs in growing industries you can get with just an associate degree:
· Radiation therapist: Operate the machines that blast x-rays at cancer cells. Median salary: $80,160.
· Diagnostic medical sonographer: Be there for parents’ first glimpse of their baby, and help diagnose internal medical issues. Median salary: $69,650.
· Occupational therapy assistant: Help unemployed people get back to work. Median salary: $59,010.
· Dental hygienist: Help patients keep their pearly whites pearly and white. Median salary: $72,910.
· Web developer: You could learn to code for free, but earning an associate degree could give you experience and a leg up in this flexible field. Median salary: $66,130.
See the full list of top 10 jobs you can get with an associate degree here.
Personally, I always suggest looking into learning how to become a specialist in cryptography and systems security…keeping bad guys out of computer systems via white hat hacking. There is a growing demand in both military and civilian applications for such. At the very least, go to a trade school and learn to a trade or be an electrician or something in the medical field.
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I'm one of those who has witnessed the growing stupidity of Americans, many of which can barely read or write or have little knowledge of our history...so it comes as no surprise me that employers would opt to use robots over humans.
Frightening stuff which most will ignore [as usual]. I reread your free reports and they are terrific resources for fighting the system - thanks for those valuable tools!
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