Here's a 1 1/2 hour talk on the 2013 Oxford University report, "The Future of Work." Among other findings, the researchers estimated that 47% of U.S. jobs could be lost to new forms of technology from 2013 to 2038. The U.S. "workforce" is about 165 million people, officially, and 47% of that would mean about 75 to 80 million Americans will lose their jobs to some form of new technology over this 25 year period. That's a lot of people. That's why I feel this issue, and small businesses, as one major solution, deserve a lot of attention.
When I was a kid in the 1970's, my dad would pull into a "service station," what gas stations were still often called back then, and a man would walk out to our car. I'm not talking a high school kid, but it was usually a grown man, who had a family he supported. That man would not only pump our gas, but he would clean the windows, and offer to check the oil, for free, while pumping the gas. This was a normal thing every time we got gas, back when gas was about 50-55 cents a gallon. That man usually would spend part of the day in the garage, repairing cars, as well. Those men working at gas stations made a decent living back then, pumping gas and fixing cars. In those days, gas stations weren't mini-marts, and people rarely went into the stations, usually my parents would pay while sitting in the car.
Obviously now, we have self service gas pumps, and we pump our own gas, which is now $3 per gallon, and $4 a gallon here in California. Those gas pump jobs are long gone. The new technology (in the 1970's) of self-serve gas pumps, was a major factor in replacing those gas station attendant jobs. In a similar fashion, ATM machines replaced hundreds of thousands of bank teller jobs in later years. Industrial robots and computer technology replaced millions of high paying U.S. factory jobs in the 1980's through the 2000's. Outsourcing jobs to foreign countries gets demonized for the loss of factory jobs, but just as many were lost to new technology. Income tax software has replaced thousands of tax preparer and accountant jobs in more recent years. These are just a few of the most obvious cases of new forms of technology replacing human jobs in the last 50 years.
In 2013, researchers at Oxford University in England released this report on the future of work,, which predicted that 47% of U.S. jobs could be replaced by new technology between 2013 and 2038. I heard about this report, being a geek on economics and Big Picture social dynamics in 2017. It blew my mind. Yes, like everyone, I realized that new forms of technology had replaced millions of human jobs already, and would continue to replace human jobs. But this report put an estimated number on that... a HUGE estimated number.
The U.S. workforce is generally estimated at about 165 million of our 328 million total population. Those are basically the people from ages 16-18, to age 65. So the 2013 Oxford report predicted about 75-80 million Americans would use their jobs to new technology from over 25 years. That's an enormous number of people. Now you can argue the researchers' thinking and estimate. But even if they're off by 20% to the downside, that's still well over 60 million people losing their jobs, through no real fault of their own, in a generation. That's huge. If the estimate is low, and the number goes higher, we get up near 100 million jobs losses in 25 years. So I added this huge trend into my own Big Picture of where society is heading in my brain. I even wrote about this is my blog (Steve Emig: The White Bear, June 28, 2017) in the summer of 2017. This continuing loss of jobs to new forms of technology is a huge issue that almost no one seemed to be paying much attention to. But it seemed to be an issue that would affect most people, in some way, at some point. Plus, my career as a taxi driver went down the tubes when new technology (dispatch computers replacing the old CB radios), so I had experienced this first hand.
As I blogged about the major recession or likely depression I saw coming (back in 2017-2019), I saw job loss from new tech as a major amplifying factor. Since I geek out on these kinds of things, I tried to figure out possible solutions. Yes, 75 million jobs will likely disappear over 25 years, but new tech will also create some new jobs. But nowhere near enough. Another option would be large new companies hiring massive numbers of people. But most of our most valuable companies now employ relatively small numbers of people compared to the major industrial age companies of 50-70 years ago. Amazon has 810,000 employees in the U.S., according to Wikipedia. As we all know, Amazon is a behemoth in retail, and is coming up on its 27th birthday as a company. Apple has 147,000 employees. Google (aka Alphabet) has 135,000 employees. Netflix has 9,400 employees. Facebook has 58,000 employees. Those are five of the most successful, valuable, major companies in the world today. All of them grew exponentially in the last 20-45 years from nothing, due to the tech revolution. Together they employ about 1,159,400 employees. Even if they all double their workforce in the next 25 years, it would barely make a dent in the job losses. The simple fact is, there will not be enough major businesses created to put 75-80 million people back to work.
For about 2 1/2 years, early 2017 to 2020, I was trying to figure out what the best solution to this huge issue would be. The only people who seemed to even think about this issue were smart people at the high tech companies themselves, and their answer was to push for a Universal Basic Income. That's where the government gives every adult a check each month, say $1,000 a month. But then, how does the government finance that? Creating that much money would lead to massive inflation, and likely hyper-inflation, where those checks become almost worthless over a year or two.
The best solution to this huge societal dilemma that I could come up with is to encourage tens of millions of Americans (and the same in other countries) to start small businesses. In effect, people could create their own jobs. This trend in micro and small businesses has been happening for many years now. Think of eBay sellers, and all the freelance people doing work using the internet, and other new tech. In fact, Amazon has 1.9 million resellers, who are small businesses, often 1 or 2 people in a garage, that work in conjunction with Amazon. That's more than the big 5 companies have in actual employees.
While no major corporation will come along to hire 40 million people, the idea of 40 million people starting a micro business (1 person business) is entirely possible. Not easy, but possible. If half of those businesses hire one person, that's 60 million people working. The numbers become possible when new small businesses are considered. After all, the U.S. began as a nation of farmers and shopkeepers, it's in our nation's DNA. So that became what seemed like the best solution to me. Then the economy began to tank in late 2019 (Repo Crisis, Sept. 2019). Then Covid-19 hit the U.S. in February/March 2020, and withing 2 months, over 45 million people were out of work, although "temporarily." About half have gone back to work, to some degree, since.
Suddenly, this long term issue of job losses to new tech seemed very real. But even now, few in business and politics are talking about this issue. Everyone is betting on the false hope that the end of the pandemic will get everything going full bore again. It will be better in in 6-8 months, but far too much damage has been done. Far too many people, tens of millions, can barely make rent or mortgage payments right now. And many major businesses are using the pandemic to find new tech to replace even more workers, and not hire them all back. This is all on top of the fact that about 60% of U.S. jobs are fairly low paying service jobs, which no one can live well on, to start with.
So for all these various reasons, I'm now focusing much of my personal writing and thought on getting my own business off the ground (I'm one of the tens of millions struggling), and helping small businesses get more creative, use the internet and social media more effectively, and looking at how different people are creating small businesses in our ever changing, high tech enabled world. So that's where I'm at.
As if this issue needed any more emphasis, I heard a presidential economic advisor say on TV that 400,000 small businesses have already closed down because of the Covid-19 pandemic. So the U.S. has not only lost over 555,000 American lives to the pandemic, we've lost 400,000 small businesses, as well.
We need MILLIONS of new small businesses in this decade. Got any ideas?
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