First Social Disruption from Technological Unemployment–a Warning

Donald Trump’s ascendancy in politics is certainly disruptive. It probably wouldn’t be happening if large numbers of well-paying middle class jobs hadn’t been outsourced in recent years, either permanently lost or replaced by minimum wage jobs. The people to whom this has happened understandably feel frustrated and scared.

What nobody has put together, at least that I have seen, is the understanding that outsourcing is a form of technological unemployment. Outsourcing wouldn’t be possible, certainly not on anything like the scale we’ve seen, without advanced technology:

  • Internet telephony has enabled companies to move customer service to third world nations
  • Distance learning and the non-physical nature of software work have enabled relocation of software jobs, with the work product available worldwide
  • Complex and automated supply chain management has made it possible to have different aspects of a production process in different countries, allowing manufacturers to use the nations with the cheapest labor

If we don’t find a way to address the very real frustrations and fears of large populations of people, the Trump ascendancy will look like a mere warmup act to what comes in the 2020s. Desperate people will grab at any solution that’s offered, whether that solution seems rational or irrational to others who still enjoy comfort and safety. When your home and livelihood are threatened, anything new seems better than the status quo.

Oxford and other researchers have forecast job losses in the United States and other developed countries in the range of 40%+, and job losses up to 85% in less developed countries. The highest unemployment levels reached during the Great Depression didn’t exceed 25%. Yet, even at those levels, the disruption was enough that Americans flirted with electing Huey Long, and Father Coughlin’s demagoguery was quite popular.

Accelerating automation is the ultimate form of outsourcing. it will not be limited to a single nation, but will instead be a worldwide phenomenon. It will hit all nations like a tsunami in the 2020s. Also, unlike the Great Depression, this source of unemployment will not be curable by public works programs. The notion of massive “make work” programs will only insult and degrade those “workers”, who will quickly become painfully aware that they are being forced to do things that machines could do better and cheaper.

Likewise, the various flavors of a guaranteed income, as commonly proposed, are seriously insufficient for reasons I have discussed elsewhere on these blogs, on Quora and elsewhere.

Social disruption from technological unemployment is already upon us. We’d better heed the warning before things get ugly.

2 thoughts on “First Social Disruption from Technological Unemployment–a Warning

  • Howard Milano


    You need to distinguish between offshoring (moving work outside the country especially overseas), outsourcing (moving work to another company) and automation (moving work to machines). Outsourcing is not bad unless it’s also offshoring. Automation can easily be done in-house, no outsourcing required. I do agree that automation is a huge threat to employment.

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