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15 July 2013updated 12 Oct 2023 9:47am

The new industrial revolution: this time, it’s different

We've been here before, in the 19th century and the 1960s. Why's it different now?

By Alex Hern

Automation has been scaring a lot of people in the last couple of years. As more and more jobs are replaced by machines, particularly in a period of already high unemployment, is there a crisis looming? The fear doesn’t just cover old-style automation, of robots and assembly-lines, but also now a new class (and, perhaps explaining some of the fear, more middle-class) of jobs are being replaced: algorithms threaten paralegals, financial journalists and, of course, traders. All of which has led the Ad Hoc Committee on the Triple Revolution to write a memo to the US President, warning:

A new era of production has begun. Its principles of organization are as different from those of the industrial era as those of the industrial era were different from the agricultural. The cybernation revolution has been brought about by the combination of the computer and the automated self-regulating machine. This results in a system of almost unlimited productive capacity which requires progressively less human labor. Cybernation is already reorganizing the economic and social system to meet its own needs.

Very much of-the-minute, of course. Except that, though the problems listed are indeed ones economists are worrying over today, The Triple Revolution was actually a memo sent in 1964 to then-President Lyndon Johnson by a group of visionaries including chemist Linus Pauling, economist Gunnar Myrdal and futurist Robert Theobald (an early advocate for a universal basic income). Frank Levy and Richard J. Murnane, economists at MIT and Harvard respectively, have dug up the old claim to make the point that these fears are hardly new. So what’s different this time?

In their report, Dancing With Robots, the economists point out what the last generation missed — “that computers have specific limitations compared to the human mind. Computers are fast, accurate, and fairly rigid. Human brains are slower, subject to mistakes, and very flexible.

“By recognizing computers’ limitations and abilities, we can make sense of the changing mix of jobs in the economy. We can also understand why human work will increasingly shift toward two kinds of tasks: solving problems for which standard operating procedures do not currently exist, and working with new information— acquiring it, making sense of it, communicating it to others.”

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So the way we deal with the rise of the machines is by identifying the sort of work those machines will displace, and encouraging people who do that work to develop new skills in areas that humans excel at. That needn’t necessarily involve moving everyone to highly skilled desk jobs, either. Levy and Murnane give the example of a mechanic, whose daily job involves a lot of easily-automatable diagnostic procedures, but also a lot of lateral thinking to solve more unusual problems. (Admittedly, the example given is a result of human error, which leads to the thought of mildly dystopian possible future where all humans do is fix each other’s mistakes while machines just quietly get on with running the world.) It’s important, as well, to remember that some jobs are improved by working with machinery, and entirely new avenues of work created. The report gives the example of a surgeon who “watches continuous X-ray images on a digital screen as she inserts a coil into an arterial aneurism next to the brain of a young man. Without continuous imaging, the surgeon would have relied on one X-ray of the brain taken before the operation began, a far riskier procedure.”

But some worries remain unaddressed. The fear for most has never been that automation would destroy jobs in their entirety; instead, it’s that the gains of automation may be entirely one-sided, while the skills mismatch that results may take generations to clear. Without targeted training – starting now – there’s the risk that people whose entire industries are automated may find themselves unemployable for the rest of their lives. We don’t even need to look back to previous waves of mechanisation to see how damaging that can be. Instead, the current state of the mining communities left in the lurch by the Conservatives in the 1980s should be all the warning we need.

Harder to deal with will be the risk of growing inequality. Unlike a skills mismatch, it’s a struggle to even get that classed as a problem (until, perhaps, it’s too late). But it’s in the nature of automation that, in each individual case of a job being lost to a machine, the employer wins and the employee loses. Even if this boosts the economy in aggregate, it’s not hard to see how that could lead to all the gains going to the shareholder class, and none of them going to the workers.

A basic income would be one potential fix to that problem, and common ownership of the means of production would be another. Both of those proposals were made during the last great wave of automation: the industrial revolution of the 19th Century. That saw one of the greatest increases in aggregate living standards the world has ever seen, but was also a century of turmoil for millions, with poverty in the great industrial cities reaching unimaginable levels.

What’s different this time is that we can see it coming. Hopefully, that means we do something about it.

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