Before generative AI replaces me (it can pry my keyboard from my cold dead hands), what’s going on with jobs? The jobs report for January was huge: 517,000 new hires and a 3.4% unemployment rate, the lowest since Woodstock. Restaurants and retailers can’t hire fast enough. Yet we’re bombarded with layoff announcements: Google, Amazon, Goldman Sachs, Salesforce, Microsoft, Disney, Dell and—say it ain’t so—fake meaters Impossible Foods and Beyond Meat. Meanwhile, productivity dropped 1.5% in 2022. Something’s screwy.
Technology has brought wonders: desktop publishing, spreadsheets, automated check deposit, social networks and speech bots. Many jobs became obsolete. And now ChatGPT spits out humanlike prose. Google’s Bard promises the same. So why are productivity statistics so underwhelming?
In 1987, the economist Robert Solow said, “You can see the computer age everywhere but in the productivity statistics.” Why? Because, as science-fiction author William Gibson purportedly said, “The future is already here. It’s just not evenly distributed yet.”
Same with technology and jobs. This headline from November is a case in point: “ILWU clerks shut down Port of Oakland.” As International Longshore and Warehouse Union president Willie Adams had written in a letter to California Gov. Gavin Newsom, “This is simply not the time to allow further job losses to automation.” Uneven distribution indeed. This pushback is sad because technology enables better jobs as capital flows to more productive uses.
We saw this on Wall Street in the 1980s with spreadsheets, which replaced X-Acto-knife-wielding experts cutting Mylar sheets spread out on large tables. Many jobs were lost, but Wall Street expanded because everybody could build digital balance sheets and dividend discount models. I think Wall Street and private equity made more money from spreadsheets than Lotus or Microsoft did.
Same with desktop publishing. Layout jobs were lost, but 10 times as many magazines were printed until the web enabled digital delivery.
