It’s difficult to imagine that the digital economy is not creating the wealth of jobs it is promising with our front-row seat to Amazon’s influx of tech workers, but a new study from Oxford economists reports that tech is having the opposite effect — it’s creating fewer jobs than everyone may perceive.
The American Enterprise Institute wrote on the Oxford study “Industrial Renewal in the 21st Century: Evidence from US Cities,” findings here, stating that researchers Thor Berger and Carl Benedikt Frey’s “results suggest technological unemployment and underemployment are big risks going forward. The digital economy is creating wealth and jobs only for a few.”
A main concern? As the tech revolution marches on, automating many jobs that were previously done by people (workers in distribution centers, delivery drivers, taxi drivers, wait staff, etc.), there is concern about “vast swathes of people” being “left behind.”
The Oxford paper documented employment opportunities in new industries created from 2000 to 2010, many of which are associated with new technologies.
AEI points out major findings from the Oxford study including this fact: “The magnitude of workers shifting into new industries is strikingly small: in 2010, only 0.5% of the US labour force is employed in industries that did not exist in 2000.”
AEI continues: “Crucially, it is found that many new industries of the 2000s stem from the digital revolution, including online auctions, internet news publishers, social networking services and the video and audio streaming industry. Relative to major corporations of the early computer revolution, the companies leading the digital revolution have created few employment opportunities: while IBM and Dell still employed 431,212 and 108,800 workers respectively, Facebook’s headcount reached only 7,185 in 2013.”
The Oxford researchers write that they intend to take a “long-term vision of the future,” up to 50 years from now, and will watch several categories: New changes and the rate of change, automation, AI, new applications and unexpected societal impacts, and existential risks and future technologies.
It’s not just big tech that’s stagnating when it comes to job creation — yesterday, AEI reported that startups aren’t creating jobs either.
“The U.S. has a much lower pace of startups, and those that do enter are less likely to be high-growth firms,” reports AEI. “Thus, startups and high-growth young firms contributed less to U.S. job creation in the post-2000 period than in prior periods.”
How safe is your gig? BBC Tech did a report on the first jobs that will be the most likely to be impacted by robots.
