October 11, 2015
Human Labor Going To Lose Value?

See: Brynjolfsson and McAfee: Will humans go the way of horse labor?

The use of horse labor used to grow along with the population and the economy. In the United States horse labor grew 6 fold from 1840 to 1900. But then it plummeted as internal combustion engines replaced horses on farms, in factories, for transportation. Does the same fate await humans, or at least some humans?

I see signs that human laborers who are only capable of simpler cognitive tasks are in declining demand and areas of prosperity are shrinking in size.

The US Bureau of Labor Statistics has an excellent web site section called Occupational Output Handbook where you can filter on expanding and contracting job occupations. Have a look at the 35 occupations that are set to grow 30% or more from 2012 to 2022. 4 require less than a high school diploma. 7 require a high school diploma. 2 require postsecondary non-degree award. 8 require an associate's degree. 4 require a bachelor's degree. 7 require a master's degree. 3 require a doctoral or professional degree.

Now lets compare that to the 82 occupations with declining employment. 6 require less than high school. 55 require a high school diploma! 5 require postsecondary non-degree award (e.g. cooks in private household). 5 require an associate's degree. 10 require a bachelor's degree. 1 requires doctoral or professional degree.

So what do we see as a difference between the rapidly rising and declining occupations? The number of occupations for high school grads is shrinking a lot more than the number of occupations opening up for them. The labor market looks like it has shrinking demand for people with moderate intellectual capability. That spells trouble for the high school drop-outs too since the high school graduates will compete more heavily for jobs that both of them can do.

I think BLS projections understate the size of the labor market disruptions coming. For example, I do not expect the projected big rise in private chefs because Moley Robotics will automate home cooking in upscale households. Also, BLS has bricklaying listed as a rapidly growing occupation. Yet Construction Robotics has an automated bricklaying robot. I fully expect taxi driving to become a shrinking occupation within 10 years due to autonomous vehicle advances. Ditto long haul trucking (and probably sooner than taxi driving).

Automation is also happening in the financial industries. Industries with rising revenues, rising output, and declining employment of humans are today's biggest success stories. What does that portend for the future of human labor?

Share |      Randall Parker, 2015 October 11 11:07 AM 

RandyBeck said at October 11, 2015 10:39 PM:

As this stuff comes online, anybody who'd think the minimum wage needs to be raised will be fooling themselves. The abandon ship order "every man for himself" will need to be given.

Then, after the dust settles, maybe we'll all get to relax, and future generations will look in horror that people once needed to work.

BTW: That Moley Robotics ad is truly stunning. I hesitate to comment because I can't be convinced it's real.

BernardZ said at October 12, 2015 3:45 AM:

I suppose it depends where you look.


I count one here, petroleum engineers that needs a degree.

Stan said at October 16, 2015 6:10 PM:

Learn to maintain and repair robots.

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