Popular economics moves in cycles, and each cycle gives rise to a new worry about the future. Back in 2008/9 the fashionable concern was about debt, a fear driven partially by Carmen Reinhart and Kenneth Rogoff’s This Time is Different. By 2014, cooler kids were clutching copies of Thomas Piketty’s Capital in the Twenty-First Century, and fretting about inequality. Nowadays the zeitgeist anxiety is that robots are about to take all of our jobs. Propelled by a never-ending stream of books and op-eds, it is a fear that is surprisingly well spread, encompassing a spectrum from billionaire technologist Bill Gates to French Socialist presidential contender Benoît Hamon. Thankfully though, while a robot takeover is capturing a lot of column inches, it isn’t showing up in the data.
Management consultants McKinsey are the latest to, er, drone on about the drones. Their Global Institute has published a report on automation that looks at 46 countries covering around 80 per cent of the worldwide jobs market. They argue that with a combination of robotics, artificial intelligence and neural networks, almost half of the activities that workers are currently paid to do could be automated by 2055. That would have consequences for 1.2bn workers, who between them earn around $14.5 trillion in wages. These are big and scary numbers, even in global terms.
The report follows in the footsteps of thought-provoking, but under-questioned, work by two Oxford academics, Carl Frey and Michael Osborne. In 2013 they claimed that almost half of all US occupations were at a high risk of automation in the next 20 years. They later extended their analysis to the global economy, and found that an outright majority of jobs in advanced economies, more than two-thirds in India and fully three-quarters in China were susceptible to replacement. The annual Alpine jamboree for the rich and powerful in Davos was last year dedicated to discussing the so-called “fourth industrial revolution.” An associated report warned that 5m jobs would go by 2020 across 15 major economies, all driven by technological change.
But there has also been one major recent study of technology, automation and the future of work that hasn’t grabbed the headlines at all. A 2016 OECD report came to a starkly different conclusion: across the developed economies “only” around nine per cent…