I recently read a serious and provocative book about a future, our very near future, that scared the bejesus out of me. The author argues that a lot of jobs are going away and there won’t be new jobs created to fill the hole. He describes a future where we won’t have any jobs for half of the work-able population. Half! 100 million US citizens permanently unable to support themselves and their families the way they do today. 100 million jobless people. I found the prediction so frightening and the argument so compelling that I can’t stop thinking about it. I believe this is going to happen and as a society we have to figure out how to deal with it. It is a dire problem; it could be a great opportunity.
The book I read, Raising the Floor by Andy Stern, is a good read, loaded with facts to back up this vision of the future. It’s hard to ignore his conclusion when you walk through his narrative. His call to action is for us to start talking about the problem now so that we can be ready with a solution. I want to do my part to start the discussion, distilling what I have learned.
This essay is my attempt to provide you the argument quickly. I want to make it easy for you to understand this vision of the future. I want to take 300 pages of book and make it 3 pages of web site.
I want to scare the bejesus out of YOU with just a few minutes reading.
My hope is that you will agree with these predictions and then you too will start spreading the word and thinking about solutions.
Humankind has been through many technological revolutions. These revolutions have changed the way we live and work, destroying old jobs but always creating new jobs. Horses were phased out, cars and tractors were phased in. Jobs to raise and care for horses disappeared but jobs to make and take care of cars were created. People moved and developed new skills and were hired into new jobs. It's always been like this.
We are currently at the beginning of another technological revolution that is quite different from those of the past. This revolution is removing jobs from the economy and not creating new ones.
The current revolution is robotics, automation, new materials, lasting quality, machine learning. This revolution is rapidly removing jobs from our economy, we can see this everywhere. Yes, the U.S. has lost a lot of manufacturing jobs overseas, but those overseas factories are also being automated. “Bringing the factories back” is a great sound bite and a few jobs will come back for a few years. But we cannot bring back all the lost jobs; those jobs are gone.
Let’s consider a couple of examples...
We, as a society, need far fewer people making things for us than we used to. That’s nothing new. But in the past, when productivity improved, things got cheaper and consumption increased so that we needed to build more things. Those two forces tended to balance out. In fact, when consumption increased faster the net result was more jobs. It's how the middle class was born.
In today’s manufacturing revolution productivity and quality improvements are rising exponentially. There is no way that increased consumption will keep up to balance the equation. We can all have more, cheaper, better stuff but fewer people will be employed making that stuff.
It no longer takes five people to build a toaster or a washing machine in a day. Instead, we only need five robot technicians to keep a factory working 24x7 building thousands of toasters or washing machines each day. Yes, you can argue with the exact numbers, but you have to admit the basic truth of this – jobs making things in factories are going away and being replaced with jobs taking care of the automated assembly line. In each case we lose hundreds of jobs making stuff and replace them with tens of jobs tending the machines.
This same revolution has happened in the past in agriculture. We no longer have every other person tending a field or milking a cow. We feed many more people but with far fewer farmers and ranchers. Now the revolution is happening to manufacturing.
Every year we need fewer people employed to make all the stuff that we all want to have. The job loss is relentless.
Years ago mom and pop local stores gave way to big chain stores: CVS, Safeway, Sears, shopping malls. All provided greater economies of scale in purchasing, distribution, and selection. Now those big chain stores are yielding to warehouse stores: Wal*Mart, CostCo. Remember when you had to drive over an hour to get to a CostCo? And you had to work for one of the “select” companies to get a membership? Now there are CostCo and Wal*Mart warehouse stores 10 minutes from most people and anyone can get in. These warehouse stores often have a smaller selection but much greater economies of scale and distribution and thus lower overall prices.
Now Amazon is eating the warehouse store. Bigger selection, huge economies of scale. Internet enabled. No physical stores. A few strategically placed gigantic distribution warehouses that are staffed with very few people considering how many units of product they put out every second of every day – and Amazon is constantly automating even more.
Think of the number of people that each mom and pop store employed in direct staffing and in the suppliers that served them in each small city. Now think of how many people are employed by Amazon in a few massive warehouses servicing half the state of California. We get our stuff delivered to our homes and don’t need people working like mom and pop did any more. The Amazon shopping revolution is eliminating jobs but no new jobs are being created. (Well, we do need more delivery people and cardboard box makers but Amazon is diligently working to eliminate those positions as well. See the part about self driving vehicles below.)
No one is immune to this technological revolution. One example: radiologists. These doctors read x-rays. Computers do not make radiologists obsolete but they do make them more productive. Machine learning is advancing at a breakneck pace. In the old days a radiologist might read 20 cases a day. Today, with sophisticated computer help that same radiologist might read 100 – sometimes just to confirm that the computer analysis is correct! So now we need only 20% of the radiologists we used to need. Oh, and with today’s high speed networking we don’t need 3 radiologists to cover every shift in every small hospital, just a regional team of radiologists.
By the way, this isn’t all bad news. Reading more x-rays makes a radiologist better at their job, so now we have better diagnoses with far fewer radiologists. Better output, fewer people, lower cost. Great stuff!
Did this revolution create a bunch of new jobs? No. We have some more IT people keeping the network going and we have a few geniuses at IBM Watson Labs improving the software that all the radiologists use. The net result is job loss.
Of course if this was only happening to radiologists it wouldn’t be a big problem. The fact is, this is happening in many, many professions. Do you visit your insurance agent or just renew your policy online? Prepare your own tax returns with Quicken? Legal forms available online - do your own divorce click, click, click. Cashiers give way to self-checkout. Dental labs use CNC routers to make new crowns instead of technicians. It's hard to believe that in 1990 every office team of 10 had a secretary to answer the phone and type up reports; those jobs are already gone, but not the people.
It used to be that a college education was a guaranteed path to the middle class. Study hard, learn well, earn a good living to support a new family. Today that isn’t such a sure thing. Your 30-year old barista at Starbucks probably has a 4 year college degree. And that barista is probably working one or two other jobs to support themselves living in an apartment they rent with three other people. Or they’re living with their parents as they try to bootstrap themselves into the middle class. Having the money to buy a house and raise a family seems hopelessly out of reach to them. They work several jobs and still live paycheck to paycheck, not because they are spendthrifts but because they simply don’t make enough money working three jobs to enter the middle class. You probably know a number of people living this nightmare.
These are individuals who want to succeed. They are not afraid of work - they'd take a fourth job if it paid well and gave them enough hours to be worth it. It’s depressing to me that these smart, hardworking people start to think, “Why am I working so hard with no chance to get ahead? What happened to the American Dream for me?” The feeling that they can’t get ahead no matter how hard they work can lead to many serious problems for all of us. Our country is built on the principle that by working hard you can get ahead. That foundation is in jeopardy today.
If you’ve read this far and don’t agree that lots of jobs are going to go away forever, then you might want to read the book. Raising the Floor has a lot of authoritative data that I think will convince you. This article will move forward assuming you have been convinced.
Take a minute to imagine what it means when we don’t have jobs for half the people in the U.S. We have 200 million working age adults. What if 100 million people don’t have a job? 100 million! It’s not that these people won’t want to work; the fact is, we won’t have a job for them. The good news is that we won't need them to have a job. Through this technological revolution we will all live a better, longer life than we have today and yet half the people won’t have a job.
In our current society this presents a huge problem. If you don’t have a job, then you don’t earn an income, then you don’t have a place to live, then you can’t buy food or clothing, then you have no health care. Without a job you have no way to take care of yourself. Imagine 100 million people in the US who are homeless and unable to feed themselves and their families. What kind of social upheaval might come out of that?
You might think, “we just need to reduce our population by half,” but that doesn’t help. If we reduce the population to half, then we reduce demand as well and we still only need half of those people to work. Reduce the work-able U.S. population to 100 million and only 50 million would have jobs – in this scenario half the people still don’t have jobs.
Is it really a problem for those who work in the jobs that are left? You bet.
If we don’t find a way to support those people without jobs, then the lives of those who do have jobs will be quite different as well. We can see it in countries today that have a huge class without jobs and living in poverty. Those in the more affluent class – those who have stuff – live in walled compounds with barbed wire. They employ private security guards to protect their homes and themselves. Every small business has an armed guard standing at the door. The half that have stuff travel in SUVs with bulletproof glass to go to the grocery store. If you don’t have enough money to pay for guards, then you have bars on your windows and worry about being robbed while sitting in traffic waiting for a green light. (I know someone this happened to. It’s common in their region of the world to have a person jump your car and force you to go to an ATM and take out a modest sum of money for them to steal. You might be carrying a concealed weapon, but you can’t draw on them fast enough. Once they have a gun in your face you just go to the ATM and give them the money.) This is so not the way I want to live.
Unfortunately, this bleak future is the default outcome. If we do nothing but let the future happen, then we’ll all be living in a very dark place. We’ll either be eking out a living at the bottom of society or we’ll be living in fear of the have-nots, behind tall walls that block the nice view. We have to find a solution.
It’s not just a matter of when, but of how fast. Do you think self-driving cars and trucks will never happen? If so, you’re in the minority. Most people think we’ll have them, but disagree on when. 2020? 2030? 2040? At some point we will have advanced the technology to the point that cars and trucks will be autonomous. 2040 seems like a long way off, but it's just over 20 years from now. And if self-driving vehicles get here sooner...
What happens when cars and trucks drive themselves? Two or three years after that happens, 80% of the people who drive for a living will be out of a job. A huge number of people drive for a living. In 28 states “truck driver” is the most common job title; we have 1.6 million truck drivers in the US. No more bus drivers, no more taxi drivers, no more intercity transport; another million jobs. Gone.
But that’s not all. With self-driving vehicles comes a huge reduction in accidents. 80% of the auto body and repair shops will be gone: 500,000 people. So will 80% of the businesses that supply these shops - part suppliers, tool companies, cleaning services, the list goes on.
When the self-driving vehicle needs gas, who cares that it has to drive a ways to fill up? Is there really any significant difference any more between Shell and ARCO? When gas stations go away, so do the people who work in gas stations, refill gas stations, and build gas stations. Meter maids, parking lot attendants, valet parking runners, rental car companies. 80% gone.
Insurance adjusters and claim processors? Don’t need them. And those radiologists? Far fewer accidents mean far fewer patients in emergency rooms. We can cut staffing there – doctors, nurses, assistants, receptionists, cleaning crews.
Self-driving cars could easily put more than 1% of our labor force out of work in the span of two years.
When this change happens it is going to happen very, very fast. We are facing a tidal wave of a change. Holy cow, we better be ready to deal with all those hard working people who are suddenly out of a job and headed to a life of poverty.
There will certainly be some jobs that stay in high demand. Some jobs require such a highly technical skill that we won’t have enough of them. People in those jobs might struggle for some work life balance, like they do today. They will have jobs but that’s not everyone. We’re talking here about the 100 million people who will want to work but won’t find any job to support their family.
We’ve seen something like this before. Remember when people had to work 12-hour days, 7 days a week to survive? Me neither, that was so long ago. Then Sunday became a day off. Then Saturday. Eventually we came to a point where one person could work just 5 days a week, 8-hours a day and support their family with four kids. That’s the family I was lovingly raised in. Five days of working a job and two days of working at leisure pursuits. Those were "the good old days." When society moved to a five day work week did we consider everyone slackers? “How dare they not work every day of the week!” No we didn’t; it was a natural consequence of our improving society. It was quite an opportunity for us all.
We face a similar challenge now. When our society has improved to the point that half the people don’t need to work at a job, we had better have a solution ready. This doesn’t have to be seen as a problem, it could be viewed as a huge leap forward, a huge opportunity for our whole society.
There are at least two things to consider: 1) how do the 100 million non-job people stay out of poverty, and 2) what will they do?
One proposal for survival is a Universal Basic Income. This is a payment from the government to every adult in the country. This payment would be enough to cover food, shelter, clothing, health care, and a few basic luxuries (internet, beer, the occasional movie, whatever). We would provide this UBI to everyone so we reduce the “us vs. them” politics. Who knows, you might have a job, but once this monthly payment starts you might decide to stop working and live more simply. That’s a-o-k, someone else will be happy to take your job.
Isn’t the UBI un-American? Hardly. Alaska has been doing this for years; every resident gets a yearly check from the state government; I don’t think of Alaska as anything less than red, white, and blue. Call an Alaskan un-American and you’ll have a fight on your hands.
There would be a lot to work out: how much is the UBI payment, does it vary by geography, and most importantly how do we pay for it.
What if the UBI was $1,000 a month? With 200M eligible people, that’s $2.4 trillion a year. Half of that might come from eliminating all current government subsidies to individuals and families. Raising the Floor claims that housing vouchers, food stamps, earned income tax credits, other social welfare programs, and the bureaucracy to administer them all add up to $1.2 trillion. Where do we get the other half of the money? It’s obvious that the money will have to come from the half of the population that has jobs. Probably through tax on businesses.
Initially I thought this would never work, those with jobs in the economy will never agree to fund those who are not. But then I thought about all those middle class people in other countries living behind tall walls and barbed wire. I thought about having to hire a security guard service to protect my person and my property. Given those horrifying downsides I think we can find a way to fund a UBI.
Some people wonder if a UBI will be a disincentive to get a job. That will certainly be true for some people, but I think that will be a small minority. I’ve asked people, if you got $1,000 a month would you quit your job? Of those that aren’t at retirement age I’ve only had one person say, “hell yes.” That person didn’t want to be idle; they had lots of ideas on what they’d do to improve society by doing things that just pay minimum wage - or less - today. The vast majority of people want to do something to earn their keep, but today that’s defined as having a job. Even with UBI I know people will want to contribute. We only have to look at people who are very well off today; do they stop working? No, they keep working. Why does the VP, CEO, or owner of a successful plumbing shop keep working? Because they want to contribute.
It will be difficult for us to shift away from thinking that the only way to contribute is to have a job, but we have to realize that we’ve created this “everyone must have a job” mentality and we can change that. We’ll have to stop thinking that people without a job are losers and welfare slackers, stealing money from those virtuous people who do have a job. We will have to start thinking that those without jobs live a normal life situation.
Several countries are experimenting on a small scale with UBI today. They specifically want to discover how a UBI changes people’s lives, motivations, and dreams. In a few years we’ll have data from those experiments so we don’t have to work with conjecture.
What will people who are not working do to achieve satisfaction? This is no small question. For some people this will be an easy transition. For others, it will be hard. People today often define themselves by what the job they hold; as a society we’ve encouraged that. Many people retire and become depressed because they have nothing “meaningful” to do. We will have to talk about this a lot. A new enlightenment about what it means to live in a grand society like ours will have to emerge.
I think we’ll discover that people are hungry to find meaningful activity and they will create new things to do. Not jobs making things, but occupations doing good. Some will just paint terrible pictures, write terrible songs, knit bad sweaters, or try to catch fish all day. Those are ok pursuits in this new economy. Many more will help older and younger people, clean up watersheds, contribute as citizen scientists, improve hiking trails, the list is limited only by human imagination. I know people will do these things because they do them today in the limited amount of precious free time they have. As I said earlier, this could actually be quite an opportunity for us all.
I’m certainly interested in other solutions to the problem. UBI is just one solution. Maybe you have some other solution. In this essay my purpose is to have you recognize that we have a problem coming. The problem is big – huge actually – and the solution(s) could be very difficult. We have to start working on this now; we can’t wait. Waiting condemns us to a dystopian future.
If you’re ready to work on solutions, that’s great. Right now we need to get people talking about the problem so that they’ll be engaged in discussing the solutions you envision.
We are clearly heading to a future where society will not have jobs for half the people. Half the people. Half! They won’t be jobless because they don’t want to work; they will be jobless because our society will not have any job for them. These people will want to work, will long to have a job, will have some very valuable skills, yet there will not be jobs for them that will support them. That could lead to great social unrest in a very ugly way. We can avoid a dire future for us all by recognizing the coming problem and working on a solution now.
The first step is to get people talking about the problem. I talk to anyone who will listen about this no jobs revolution. If my friends agree there’s a problem, then I talk about UBI as a potential solution. I always try to end with the thought that UBI is just the solution that I see now. I would enjoy a discussion about other solutions. What I want to avoid is a future where I huddle inside my family compound to avoid the violence around me.
You can help by spreading the word. Talk about the coming problem and opportunity with your family and friends. Can you get them to acknowledge the situation? If so, what do they think we should do about it?
I hope I’ve done justice to the concepts in the book Raising the Floor. I hope I’ve made the case for the coming crisis in a succinct few pages that were not a slog to read. I’d like to improve this article and I would really enjoy feedback from you, the reader. If you’re a friend, call me or bring it up the next time we meet. Don’t be afraid to give me direct, specific (and non-punishing) feedback on the essay or the topic in general. If we’re not acquainted, then send me an email with your thoughts. I honestly feel that the future of our society rests on finding a solution to this coming opportunity.
1. Truck driver most common profession
2. Alaska permanent fund
3. Raising the Floor by Andy Stern