Back in December I posted about a New report on automation and AI replacing human labor.
The New York Times editorialized in February that No, Robots Aren’t Killing the American Dream. As evidence, the Times cites “the data indicate that today’s fear of robots is outpacing the actual advance of robots. If automation were rapidly accelerating, labor productivity and capital investment would also be surging as fewer workers and more technology did the work. But labor productivity and capital investment have actually decelerated in the 2000s.”
Sarah Bauerle Danzman, assistant professor of international studies at the School of Global and International Studies at Indiana University Bloomington, and Jeff D. Colgan, the Richard Holbrooke associate professor of political science at the Watson Institute of Brown University, respond today at the Washington Post. Robots aren’t killing the American Dream. Neither is trade. This is the problem.
Unfortunately, [the Times‘] argument leads many people to conclude that globalization and liberalized international trade must be what’s hurting U.S. manufacturing. That’s the argument that Alan Tonelson, a campaign adviser to both Donald Trump and Sen. Bernie Sanders (I-Vt.), made in a more recent Times op-ed. According to Tonelson, the U.S. economy needs protectionist policies to revitalize it.
But they’re wrong. Worse, those arguments distract us from implementing the policies that could most help the American worker. Here’s why.
1) Automation is reducing employment in key industries.
The U.S. economy has steadily lost manufacturing jobs since the late 1970s. In 1970, manufacturing employed close to 25 percent of the workforce; but today employs only about 8.5 percent of working Americans. At the same time, the real median household income for people with high school diplomas but not college degrees fell 27.8 percent.
One key piece of evidence is that the United States shed 5 million manufacturing jobs from 2000-2014, even as output over the same period rose. That suggests that automation is the primary reason for the loss. If international trade were the chief culprit, we would also expect U.S. manufacturing output to decline.