Machines replacing workers: documents raise worries about loss of jobs
Jordan Press and Alexander Panetta, The Canadian Press
Published Saturday, March 18, 2017 11:02AM EDT
Last Updated Sunday, March 19, 2017 3:17PM EDT
Federal officials were warned over the summer that machines are going to replace more jobs in the workforce in the coming years and that will require a rethink of how government helps the unemployed.
Documents prepared for top officials at Employment and Social Development Canada don't hint at how federal policy will have to adapt to increased automation in the workforce, noting that predicting the future is a risky proposition.
Experts say what's missing from the documents is any hint of concern that the rise of the machines is an immediate concern that the government must quickly address.
"Many of the trends that may concern us about technology and automation in terms of what their impacts could be on workers are already happening and that's, I think, the missing piece here," said Sunil Johal, policy director with the Mowat Centre at the University of Toronto.
"People are projecting this into, well, in 10 years we may be in a difficult situation. The reality is many Canadians are already ill-served by government policies when it comes to skills training, when it comes to employment insurance, when it comes to the broader suite of public services to support Canadians."
Depending on the methodology used, the Canadian economy could lose between 1.5 million and 7.5 million jobs in the coming years due to automation.
The jobs at the most risk are those that require repetitive activities like an automotive assembly line, although even some high-skilled workers, such as financial advisers, are already being replaced by software programs. The documents also note that journalists could see themselves increasingly replaced by robots.
One industry source, who spoke on condition of anonymity in order to discuss private conversations, said senior government officials acknowledge automation is something they have to deal with, but likely not for decades. The source said that senior officials believe new jobs will be created to keep people working.
The documents say new jobs will be created because that's just the way the economy works: As technology kills jobs, it also creates new ones. The issue, the documents say, is that no one knows if enough jobs will be created to replace those lost, nor if they will all be as well-paid.
"Predicting the future brings significant risk," reads part of a presentation released to The Canadian Press under the Access to Information Act.
"We cannot know what future jobs will be created or whether enough of them will be created to offset displaced workers or whether automation will offset the pressures arising from slowing labour force growth."
The rest of the slide has been blacked out because it contains sensitive advice on future policy paths.
The Liberals are telegraphing that they will make skills training services a focus of Wednesday's budget. Once the budget puts a dollar figure on the federal contribution to training, negotiations with provinces and territories on the main funding vehicle for the cash -- the labour market development agreements -- can be finalized.
In a paper he co-wrote last year, Johal argued that the government also needs to look at expanding access to existing training programs, create targeted programs and labour market protections like minimum wage rules for independent contractors and look at introducing emergency lines of credit for people who need a short-term financial boost.
Labour Minister Patty Hajdu said the government is looking to find a way to help sectors who are short of workers, and guide people into emerging fields.
"Successful economies and countries are ones that can be adaptive and that's why skills development is so important," Hajdu said in an interview.
"I'm excited about being able to do that work and help people gain those skills for the shortages that we have in specific sectors and to help support that innovation agenda that really is about fostering creativity and being thoughtful and deliberate about what skills we're training people for."
A study at Oxford University in 2013 concluded that 47 per cent of jobs risk being computerized. That includes blue-collar and white-collar jobs. A more nuanced conclusion comes in a recent McKinsey study: that few careers will be completely eliminated by mid-century, but almost half of human tasks will.
The coming change could be as dramatic as the shift from an agriculture-based economy -- at a far faster speed, says a well-known Silicon Valley entrepreneur, author, and now semi-retired lecturer on the societal effects of artificial intelligence at Stanford University.
"These developments are likely to usher in a new age of unprecedented prosperity and leisure, but the transition may be protracted and brutal," Jerry Kaplan writes in his book "Humans Need Not Apply."
"We may be in for an extended period of social turmoil. The warning signs are everywhere... If these are left unchecked, we may witness the spectacle of widespread poverty against a backdrop of escalating comfort and wealth."
One example of wealth without workers comes in Martin Ford's book "Rise of the Robots." He notes the decades-long decline in U.S. labour-force participation. And he points to Google turning a bigger profit in 2012 than General Motors at its 1979 peak, in inflation-adjusted dollars -- with just 4.5 per cent of the workers.
Bill Gates is so worried he wants to tax robots. The revenues would go to displaced workers. The costs would be a temporary disincentive for companies to automate, slowing the pace of change and giving humans some time to plan.
The biggest disruption could be driverless vehicles.
Kaplan says they'll do great things -- saving thousands of lives by reducing accidents, making cities more efficient, reducing people's transportation budgets as they hop a ride with roving pods.
Yet they will obliterate millions of livelihoods in the U.S. alone, he says.
Long-haul trucking could be first. Mining giant Rio Tinto has bragged about the performance of its self-driving trucks at Australian test sites. It won't be as easy for urban transport, but companies are already working to lobby governments for regulations friendly to self-driving cars.
Uber is testing autonomous vehicles -- which could replace its drivers, who have just disrupted taxi drivers.
One auto executive said in a chat with The Canadian Press that fully autonomous vehicles were 10 years away. When asked what might happen to millions of truck drivers, the executive replied that it's a hard job -- they will find something better.
Policy-makers aren't all so confident.
Finance Minister Bill Morneau tasked an advisory council to study issues like this. It's unclear how many of its suggestions will wind up in next week's federal budget, or future ones. It proposed creating a partnership called FutureSkills -- uniting governments, companies, and unions to share data on labour trends, and co-operate in skills training.
The partnership model isn't new.
Barack Obama created manufacturing hubs in the U.S., inspired by Germany's Fraunhofer institutes. In nine U.S. cities, federal agencies like NASA, college researchers, and companies share intellectual property and high-tech equipment.
Obama's senior adviser for innovation and manufacturing policy says the textile hub is working on smart fabrics -- like hospital gowns that monitor vital signs and could alert the doctor in an emergency, or military gear that tracks injured soldiers.
An Australian panel recommends preparing young people for multiple careers -- instead of getting skills for just one job, they learn about several related ones.
Kaplan suggests a simpler idea.
He calls it a job mortgage.
The same way you can sign a contract for a house, he believes a laid-off worker should be able to sign a company contract that guarantees a job following some training; take it to the bank and request a loan covering the transition costs; and get tailor-made training, designed by the industry and offered by a private education startup.