Tech Is Splitting the U.S. Work Force in Two

A small group of well-educated professionals enjoys rising wages, while most workers toil in low-wage jobs with few chances to advance.

Automation is splitting the American labor force into two worlds. There is a small island of highly educated professionals making good wages at corporations like Intel or Boeing, which reap hundreds of thousands of dollars in profit per employee. That island sits in the middle of a sea of less educated workers who are stuck at businesses like hotels, restaurants and nursing homes that generate much smaller profits per employee and stay viable primarily by keeping wages low.

Recent research has concluded that robots are reducing the demand for workers and weighing down wages, which have been rising more slowly than the productivity of workers. Some economists have concluded thatthe use of robots explains the decline in the share of national income going into workers’ paychecks over the last three decades.

In the past, with every technological advance, humans can always go up in the value chain and do more with the help of machines. The rise of productivity is what pushes wages and living standard higher. So what if with robots and AI some humans are just not smart enough anymore? That machines can do everything better than them and they have no value to society?

Deep questions. But fortunately (or unfortunately) AI is not there yet. It may never get there.

Soon even manual labor is not safe from AI.

@manch discovered new continent! What NYT said have been discourse in this forum months ago. No new insight.

No new insight, yes. But where does this lead to?

It would be wonderful for robots to take over the entire work force. Foolish for people to resist. Why work when you can have robots do all the work for you? Go to the park and play!!! :rofl:

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Capitalists, the ones who own the robots, get all the benefits.

The guys being replaced, the low to mid skill labor, get nothing.

That’s just inequality on steroid. Not sure how it will play out. :thinking:

We are already seeing a preview of the backlash against tech companies. Maybe USA will turn into a communist country and all robots will be owned by the state. Nationalize the means of production! :smile:

Did you see “Eagle Eye” Movie? The AI drives…

No, didn’t see the movie.

Looking back at history, the Industrial Revolution completely changed the trajectory of the modern West. China used to be the dominant world power but Industrial Revolution put West on top decisively.

Will the upcoming AI Revolution have impact of a similar scale? How will it change the politics? I don’t think a democracy can sustain such a high level of inequality. Something’s gotta give.

Interesting time. Can’t wait. :smile:

It is tough to win the AI, we have seen in games, precision drone attack, HFTs, now driver less cars, big data analysis…etc.

I do not know how it changes politics, but impact is high as we proceed year over year.

If you get a chance, see Eagle Eye, may be in netflix or amazon prime. Computer (AI) controls everything in life. Even though fiction, some of them will be reality.

Too much fearmongering. Nothing indicates robots will make the lower class miserable. They can benefit both the rich and the poor. The rich definitely gets a lot richer but doesn’t mean the poor becomes worse off. This is not a zero sum game, otherwise capitalism would not have worked so well.


The industrial revolution sparked communism, WW1, mass murder, and major disruptions in society. Buckle up the next wild ride could be devastating.

Someone needs to design, manufacture, operate, maintain, and upgrade the machines. And - most importantly - the profits the owners of the robots realize will get plowed into new ventures; money never sleeps.
If this really is a trend (I’m still skeptical) where are the investment opportunities? Shortly after Obama’s’ famous auto-teller remark an ETF was launched as a play on robotics and automation. It underperformed the market terribly.

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Exactly. But people don’t see it that way. For example,
Your $1M grew to $5M in 5 years.
@manch, $500k grew to $2.5M in 5 years.
@manch won’t be happy that his also grew by the same percentage. He would claim that 5 years ago, the difference in net worth is $500k, now is $2.5M, a HUGE jump of 500%. So rich becomes richer! He wants to maintain the same absolute difference i.e. his to grow to $4.5M :slight_smile:


Banks employ more employees now than they did before the ATM. It won’t necessarily cause job loss, but the jobs created will be different. For the first time in history, the number of open jobs is greater than the number of unemployed. That would seem to disprove the doom and gloom that it’s already happening.

At least they correctly identified that profit per employee is the determining factor in how much a business can afford to pay employees.

I’d argue regulations are weighing down wages. Every employee hired for compliance is an added expenses that doesn’t increase revenue. Those expenses add up. Also, a significant hidden pay increase is higher healthcare premiums paid for by businesses.

What you just said is ATM reduces jobs, compliance increases jobs. Simple answer to unemployed, put in more regulations and compliances. Done.

The ATM didn’t lead to less jobs. It led to different jobs. Banks started to offer more services.

Compliance jobs are a drain on profits and will drag wages for everyone lower.

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Those services has nothing to do with ATM, right?

Doesn’t matter. What people want is jobs.

The ATM replaced the teller, and the banks moved people to new jobs selling services which led to revenue growth. Without the ATM, they never would have had the freedom to make the change.

There are more jobs than unemployed people. The issue is stagnant wage growth. Compliance jobs are a drag on wage growth, since they don’t increase revenue.

The article already says, correctly, the number of jobs is not necessarily the whole story. You also need to look at the quality of jobs. Increasingly jobs are created at the two extremes of skill levels. The middle skill level is gone.

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