Thought provoking essay by Walter Russell Mead for the American Interest entitled: The job crisis: Bigger than you think. Worth reading!
Mead tells well the story Michigan Future has been describing for years. That just as more than a century ago when agriculture could no longer be a source of a prosperous America, the same is true today. The mass production economy that anchored 20th Century American –– and particularly Michigan–– prosperity can not be the anchor of a prosperous 21st Century America. Future American and Michigan prosperity most be built on a new economy.
Essentially, the problem is this: automation and IT are moving routine processing, whether what’s being processed is information or matter, out of the realm of human work and into the realm of machines. Factory floors are increasingly automated places where fewer and fewer human beings are needed to transform raw materials into finished products; clerical work and many forms of mass employment in business, government and management are also increasingly performed more economically by computers than by trained human beings.
The transformation is only beginning to kick in. Self driving cars and trucks may reduce the need for human beings in the transportation and freight industries. Information processing is beginning to change the nature of the legal profession and even as law school applications fall by almost 50 percent there is much more change to come. Computer assisted diagnosis is making itself felt in health care. MOOCs are likely to change the way much of higher ed works.
… automation and globalization aren’t going away; in both good times and bad the foundations of the old social order will continue to erode. … The old jobs are going away and they aren’t coming back. More, we can’t fix the problem by trying to create new jobs in factories or traditional office bureaucracies to replace the ones going away. We need new kinds of jobs that don’t involve manufacturing or traditional forms of information processing.
Unlike many others, Mead is optimistic that we can and will build a more prosperous America just as we did a century ago after the decline of agriculture. But to do so will require fundamental change from all of us. There are no political levers available to make the old economy work again. He writes:
In the 19th century most Americans spent their time working with animals and plants outdoors in the country. In the 20th century most Americans spent their time pushing paper in offices or bashing widgets in factories. In the 21st century most of us are going to work with people, providing services that enhance each others’ lives.
… A service economy resting on the high productivity agriculture, manufacturing and information processing will be a more affluent and a more human economy than what we have now. Human energy will be liberated from wringing the bare necessities from a reluctant nature; energy and talent will flow into making life more beautiful, more interesting, more entertaining and easier to use. By 1960 few American suburbanites really envied their hardscrabble, uneducated ancestors shivering through the winter in sod huts on the open prairie; one suspects that few Americans in 2060 will be pining for the glorious old days of 9 to 5 at GM.
But the change will come hard. The tax system and the financial system will have to change to promote the rise of a new world of jobs. The educational system will have to change to prepare young people for new kinds of lives. We are going to have to make all kinds of changes as our society comes to embody a new kind of economic logic. The changes won’t be easy but they aren’t optional.