a page you may want to follow on Facebook, posted the following discussion yesterday:
FALSE NARRATIVE: “Technological advancement is threatening to eliminate billions of jobs, creating a future in which the economy produces everything we need, yet nobody can afford it because everyone is unemployed!”
REALITY: The narrative fails to account for the other side of the equation. Technology doesn’t just reduce the need for labor, it also reduces the need to work. How? By reducing the cost of goods and services. For example, if I need to work 60 hours a week to buy everything my family needs to survive, but new technology suddenly reduces the cost of those necessities by a third, now I only need to work 40 hours a week to provide for my family. So even if technology reduces the demand for labor, it also reduces the supply of people seeking work.
History shows that technology has allowed people to work shorter hours and fewer years. Less than three hundred years ago, nearly everyone worked, including children. There was no such thing as retirement. You worked or you starved. Then came the unprecedented technological advancements of the industrial revolution. Yet instead of putting people out of work, it allowed them to work less. By the mid-1800s, families could survive on one income. Children could become educated, and one spouse could tend to the home.
A hundred years ago, essentially all men in their early 60s worked; today just six in ten do, and the typical retirement age has steadily declined despite life expectancy increasing. All while standards of living improved.
And a future economy in which automation produces more goods more efficiently will create even greater cost savings. Yes, there will be fewer jobs and hours available in many industries, but we’ll also need fewer jobs and hours to survive.
ALL OF THIS comes with one BIG “if”… Productivity will only increase if we allow the market to function with the least intervention possible. Government forces tend to make costs INCREASE, which is why central economies had lower productivity and wealth. It’s very important that we give markets as much freedom as we can, or all bets are off.
FURTHER READING: http://www.realclearmarkets.com/articles/2013/07/16/for_the_last_time_robots_do_not_cause_unemployment_100478.html
Following up with:
Further proof that technology has not been destroying jobs, this graph shows that we’ve been working fewer hours, yet still making more money (inflation adjusted).