SOMETIMES EVEN VISIONARIES ONLY SEE HALF THE PROBLEM
Marc Andreessen, he who created the Netscape Navigator and ushered in the age of the Internet, now runs a very successful venture capital firm in Silicon Valley. From time to time, Marc can be found on social media sites conversing about technology, economics, and any number of other topics. One these topics is something that a number of economists have been discussing for the last few years and the general public seems to be waking up to – the impact of technology on jobs.
Marc argues that technology isn’t a job destroyer but a job creator. A favorite data point of his seems to be the U.S. economy recording 5 million new hires each month (Marc mistakenly quotes this as per quarter in the article, it’s actually per month). This isn’t to say there are 5 million new jobs created each month, just that 5 million people were hired into existing open roles.
Marc’s point, which is valid to a degree, is that robots aren’t taking our jobs if 5 million people are being hired each month.The problem with this argument is it represents only one half of an equation.
WELCOME TO THE CHURN
Yes, 5 million people are hired per month, which is great! But, and this is the kicker, 5 million people are fired or quit each month. That’s 10 million people cycling in and out of work every month with no gain to the economy. After a year, that’s equivalent to half the population of the United States.
Feel the churn!
Taken together these two statistics show how inefficient (broken?) the U.S. labor market is for employers, employees, and those seeking work.
Essentially, there’s a giant churn going on throughout the economy. This is an enormous productivity drain for everyone involved (btw, everyone = all of us) not to mention the toll it takes on people’s well-being by working in jobs they aren’t qualified for or dislike.
So yes, Marc is right, the robots aren’t taking our jobs just yet. But we humans aren’t making it tough for them to do better given our record of getting the right people into the right roles and the right companies.