Stop worrying about automation: the real problem might be too few workers

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Stop worrying about automation: the real problem might be too few workers

Ignore the employment doomsayers — chances are we’re going to run out of workers before automation causes mass unemployment.

While neoliberalism is — correctly — the villain du jour, one of its unalloyed successes has been in getting people into jobs. Unemployment has not been above 6.5% since 2002; it was above 6.5% for nearly all of the 1990s and most of the 1980s. Underutilisation is higher now than in the 1970s, true — but it’s still below the level it was at for most of the 1990s. The reason this achievement is particularly impressive is because far more Australians work now than in the pre-neoliberal era. In 1978, when the ABS first began publishing its current employment series, the employment:population ratio was around 57% in trend terms. In 2004, it went past 60%. It reached well above 62% in 2011 before falling back, but it has been above 61% for most of this year.

That’s because vastly more women are now in the workforce. In the 1970s, less than 40% of women worked in paid employment. That figure reached 50% in the late 1990s; this year, for the fist time, the proportion of women exceeded 56%. So not merely is unemployment lower now in previous decades, but it reflects the fact that the economy is employing a much higher proportion of the population than it used to, especially women. In terms of both economic growth and economic empowerment of women, this is a good thing.

But we’re still fixated on unemployment. Not actual unemployment, but future unemployment, the unemployment predicted by gurus and futurists and a few billionaires who claim that a massive wave of automation will take up to a third — perhaps more — of jobs in western economies away. No longer will automation be confined to factory floors, they warn; it will soon start consuming service jobs, from your Uber driver to your lawyer to the journalist who writes Crikey articles — AI and algorithms will replace humans and lead to a new era of widespread unemployment.

Well, possibly, but at the moment, our problem is not too many workers but too few. Despite the government’s “crackdown” on the 457 visa category (which amounted to renaming it, trimming a few categories and then bunging some back on after an argument with industry), there were still over 160,000 457 visa workers in Australia — down from the ~200,000 in 2013 and 2014, but still higher than in 2011. We’re also bringing in 128,000 immigrants this year, the same number as last year, under the skilled migration program. So Australia continues to import large amounts of labour. And barring a massive change, our demand for foreign labour is only going to increase: the 2015 intergenerational report argues that labour force participation has peaked and will slowly but steadily decline back to 1980s levels as the population ages between now and the 2050s.

That ageing is a key source of new employment. The largest and fastest growing industry in terms of employment is health and social care, which became our biggest employer in 2009 and now employs around 13% of all workers; in the last five years the sector has needed an extra 45,000 workers each year — many of whom have had to be imported from overseas as either migrants or 457 visa holders (once dominant, even now health professionals remain one of the largest sources of 457 visa applications). Health, aged care and childcare are just part of the services economy; the specific services industry classification has grown to around 8.5% of the workforce in recent years. And we rely on imported labour in other service areas, like the hospitality industry, as well.

One problem is that services jobs are not accorded the same respect as “traditional” jobs in manufacturing. This is partly the sexism of the old industrial left, which thought the only meaningful jobs were blue collar labour that produced a physical product; that sexism still lingers (it’s why we’re still even now propping up male-dominated heavy manufacturing, while the one manufacturing sub-sector with high female representation, textiles and clothing, no longer gets any support). Services jobs where emotional intelligence, client satisfaction and effective communication are required are derided as “Mcjobs”, somehow not fit for adults.

There are other forms of bias too, for that matter. Yesterday the Chief Scientist Alan Finkel was mocked by a tech entrepreneur for suggesting that Australia’s mining sector was highly innovative. For all the criticisms justly levelled at the mining industry, our big miners are world leaders in mining tech and especially transport — particularly in areas like autonomous vehicles, entire fleets of which now serve mines in the Pilbara. But because it’s not a new smartphone or killer app, and because it’s so distant geographically and conceptually from most of us, it, too, is partly invisible.

Perhaps we can strike a deal with the “automation will take our jerbs” crowd: we can have a serious debate about the looming crisis of Courtesymass unemployment if and when we stop importing tens of thousands of workers a year to look after us.

 Courtesy of Crickey  – Bernard Keane – Political Editor

Administrator’s note:

Combine this reduction of spending on education in critical fields like technology and the sciences an innovation, and an equally disarming pull-back on effective training spend strategies – including apprenticeship and trades training schemes into the future – and Australia’ future ageing work-force without short-term and permanent migration looks to be in serious trouble.