Is technology to blame for our stubborn unemployment? President Obama scored ATMs and airport kiosks in a 2011 "Today Show" interview, blaming them for "structural issues with our economy." Other technophobes have piled on. Former Labor Secretary Robert Reich wondered late last year: "What if we're stuck at a new normal of high unemployment and low job growth? It's possible because technology might just have gotten the best of us." In March, Salon.com declared "Your iPhone kills jobs." And in May, the Economist suggested "technology may destroy more jobs than it creates."
The road to wealth does indeed pass through the graveyard of today's jobs. But history shows that better, higher paying jobs are always created by technology—even if no one seems to remember this during periods of creative destruction.
The trick is to lower the cost of new machines and inventions that can do things never before possible, making them available for wide use. Here are a few recent examples that could be economic game-changers and job-creators:
• Three-dimensional printing. By now, you've probably heard of 3-D printers, the gadget du jour for geeks that creates objects from computer models, building them layer by layer. Right now, they are priced between $1,000 and $10,000, with the most expensive version able to print multiple materials.
Some 50,000 have been sold so far, mostly to designers in order to create expensive prototypes. But by next year, the expiration of a key patent on "laser sintering," a method that fuses materials with lasers, will mean cheaper 3-D printers and the growth of an industry of producers of hard-to-find auto parts, industrial designs and even jewelry. Some are even talking about the possibility of printing human tissue.
This reminds me of laser printers, which now cost $200, but cost $17,000 when the Xerox Star 8010 hit the market in 1981. Today, most magazines and office jobs couldn't exist without them.
• Blood markers. As ObamaCare inevitably drives health-care costs higher, it will be in the best interest of insurers to detect disease early to prevent the high cost of treatment. This is particularly true with cancer. Each cancer tumor expresses unique proteins that end up in our blood streams. Once found, these markers can be used to identify the disease before it spreads.
Postgraduate biochemists have been working with $100,000 mass spectrometers analyzing results in studies. This spring, blood markets were even discovered for Alzheimer's. As cheaper machines come on line in the next few years, the process will go mainstream. In turn, researchers will invest in more machines and will need to hire thousands of scientists to man them.
• Gene therapy. If cancer is detected, it can be cut out, radiated or drugged. But often the underlying gene mutations that cause cancer and other diseases persist.
The era of gene therapy may be upon us. By hacking genes—in effect, genetically engineering a retrovirus programmed with DNA to overwrite a particular mutation—the body then does the work of reversing disease. Dogs have been cured of Type 1 diabetes with gene therapy, and Glybera, a gene therapy treatment, has been approved by theEuropean Union for treating people with lipoprotein deficiency.
The equipment to do this—they are called Fast Protein Liquid Chromatopraphy and Polymerase Chain Reaction—already exists and I suspect will get cheaper with volume. This requires smart scientists at every hospital to identify mutations, harvest stem cells and then reprogram and re-inject them.
This is much like gene splicing, which Genentech used 30 years ago to create insulin, and the ever-cheaper DNA sequencing of the last decade. Gene therapy will be a boon for biologists and chemists.
• Funding platforms. Last year in the U.S., venture capitalists, who have traditionally funded our entrepreneurs, invested just $27 billion in 3,800 companies. It's inefficient.
Fortunately, new funding platforms like Kickstarter and Indiegogo allow entrepreneurs and creative types to appeal directly to users to fund their projects, much as eBay and Craigslist helped drive individual merchants.
Kickstarter has helped raise $619 million for more than 45,000 projects. I expect this to grow 100-fold over the next decade, and each funded project will create new jobs.
• Robots. Robots have already been welding car parts, making the chips in your iPhoneand moving things around warehouses for many years. But now they are getting personal. Not so much R2-D2, but programmable for repetitive tasks.
At $22,000, Baxter from Boston's Rethink Robotics is easy to train and human-friendly (it stops if you stick your hand near it.) Yes, it's cheaper than a human worker, but like laser printers and soon 3-D printers, it will augment rather than replace people.
Robots might bring back some mass manufacturing from offshore, but the real upside is that they can do things that haven't been done before. Like programmable machine tools, these more personal robots will change the way small- and medium-size manufacturers operate, lowering costs and creating a hiring binge for those savvy enough to use them.
Add the above to the manufacturing renaissance driven by fracking, and tens of millions of new jobs will be created by technology. Most of these great, higher-paying jobs will require smart college graduates or retrained workers. But, as always, each great job creates a handful of good jobs, such as lab assistants and human resources professionals, and another handful of fine jobs in food service and retail.
Just as politicians and policy makers are currently blaming these new technologies for destroying jobs, once the technologies start creating jobs, those in Washington will inevitably take credit. These types are best advised to clear a path and stay out of the way.