Economy

Myth Debunked: Machines Create More Jobs Than They Destroy

Many assumed automation would take jobs from real workers, but that seems not to be the case
Many assumed automation would take jobs from real workers, but that seems not to be the case
Alexander Hagelüken

MUNICH — Do machines replace humans? Since the beginning of industrialization 200 years ago, we earthlings have been plagued by this fear. From the early uprisings of the weavers to the 1970s "job killer computer" slogan, and up until the 2013 thesis of researchers Michael Osborne and Carl B. Frey, according to whom machines could soon take away every second job. But a German researcher, Terry Gregory of the Institute of Labor Economics (IZA), now presents a very different calculation. According to him, automation has brought Europe an additional 1.5 million jobs in the past decade.

Whether machines are our friends or enemies is one of the most intense economic debates, and one in which extreme positions dominate. On the one hand, you have the optimists, who only calculate models in which machines and people complement each other perfectly. On the other, skeptics the likes of Osborne and Frey who use vague job descriptions and neglect positive effects.

Gregory and his colleagues at the Leibniz Centre for European Economic Research (ZEW) try instead to get closer to reality using comprehensive models. Yes, between 1999 and 2010, machines cost Europe 1.6 million jobs, mostly of them in production. But according to what the companies had originally forecast, it should have been three times as much. On the other hand, computers and robots made it possible to produce goods more cheaply. As a result, consumers bought more and thus created new jobs. The companies made more profits, which in the wallets of their owners also turned into more consumption and thus more jobs. This resulted in the creation of a total of three million jobs — twice as many as the machines destroyed.

By 2025, digitization in Germany will create about as many jobs as it will destroy.

This positive balance can also be explained by the fact that factories are losing importance. Three out of four Germans now work in the service sector, delivering parcels, caring for the sick or designing houses. They are therefore not as easily replaced as people working in production on assembly lines, at least not yet. If, unlike Osborne and Frey, you look at concrete jobs instead of vague job descriptions, the automation potential of existing jobs drops from 50% to 10%, according to the OECD. Germany's Institute for Employment Research (IAB) doesn't see computers as job killers either. According to its forecast, by 2025, digitization in Germany will create about as many jobs as it will destroy.

This, however, doesn't mean in any way that those who lose their jobs to a robot will automatically get a new position that suits them. In certain sectors, the risks are concentrated. One in four Germans now works in a profession that can largely be handled by machines. Two million people work in warehousing, drive trucks or buses, which could potentially be replaced by autonomous vehicles. "Employees have to train themselves further, companies have to retrain them", Terry Gregory says. "Out with the routine, workers have to be redirected towards analytical, socially interactive activities. This is the transformation that economies must create." So, how much will the era of the machine affect people in the future? It will depend very much on politics. Also scientists at the World Bank have said so. According to them, the automation of the past decades has hit workers in the U.S., Great Britain, and Australia harder than elsewhere because of a bad social safety net and poor basic education that prevents laid-off industrial workers from being retrained for new jobs.

The consequences of the machine boom also depend on who owns them. Terry Gregory says that one positive effect is the fact that automation generates additional profits that the company owners spend, thus creating additional jobs. However, according to his findings, if a German company happens to be in the hands of foreign shareholders, they will spend most of their money abroad. The model shows that if all the profits had been drained away, there would have been 300,000 fewer jobs created in Europe. According to the model, it seems to make no difference whether Chinese, Indians or Arabs buy up most German companies, the end result is the same. There is, therefore, a strong argument for turning as many Germans as possible into shareholders, in order to share with them the profits brought by the machines, and thus stimulate national consumption.

Still, the bottom line is that, according to Gregory, automation in Europe has had a positive effect on jobs in the 2000s. The only question is: Will this also be the case in the future? This is the biggest counter-argument coming from skeptics like Osborne and Frey: The new technology of today and the future cannot be compared with anything we've seen before because the latter can potentially threaten every sector. Future robots, computers, and algorithms could simultaneously destroy simpler as well as more sophisticated service activities. They could deliver parcels as well as take care of the sick and answer customer inquiries in call centers. They could also design houses, prepare complaints and diagnose patients, thus replacing architects, lawyers, and doctors. That's already often the case in the U.S. If machines make products cheaper, the additional demand may not result in new jobs for people, simply because the machines would take up these jobs too.

Technologies always end up spreading more slowly than expected.

Terry Gregory finds this too pessimistic. "There have always been such horror scenarios over the past centuries," he says. Admittedly, artificial intelligence brings a lot of novelty with it. "But such technologies always end up spreading more slowly than expected." Until now, for example, only 5% of German companies have adopted networked robots and other such tools of the industry 4.0. "Of course, nobody knows exactly what the future holds. It's a gaze into the crystal ball. But people will have time to adapt to it."

They'll have to anyway. But according to a World Economic Forum study, not even half of Germans have the basic knowledge that the jobs of the future will require.

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Coronavirus

Where Lockdowns For LGBTQ Meant Moving Back In With Homophobic Relatives

The confinement experience could turn brutal for those forced to live with relatives who would not tolerate a member of the family living their sexual orientation openly as a young adult. Here are stories from urban and rural India.

At a Rainbow pride walk in Kolkata, India

Sreemanti Sengupta

Abhijith had been working as a radio jockey in the southern Indian city of Thiruvananthapuram when the COVID-19 pandemic hit in March, 2020. When the government imposed a nationwide lockdown, Abhijith returned to the rural Pathanamthitta district , where his parents live with an extended family, including uncles, cousins and grandparents.

Eighteen months later, he recalled that the experience was "unbearable" because he had to live with homophobic relatives. "Apart from the frequent reference to my sexual 'abnormality', they took me to a guruji to 'cure' me," Abhijith recalled. "He gave me something to eat, which made me throw up. The guru assured me that I was throwing up whatever 'demon' was possessing me and 'making' me gay."


Early in 2021, Abhijith travelled back to Thiruvananthapuram, where he found support from the members of the queer collective.

Inspired by their work, he also decided to work towards uplifting the queer community. "I wish no one else goes through the mental trauma I have endured," said Abhijit.

Abhijith's story of mental distress arising from family abuse turns out to be all too common among members of India's LGBTQ+ community, many of whom were trapped in their homes and removed from peer support groups during the pandemic.

Oppressive home situations

As India continues to reel from a pandemic that has claimed more lives (235,524) in three months of the second wave (April-June 2021) than in the one year before that (162,960 deaths in March 2020-March 2021), the LGBTQ community has faced myriad problems. Sexual minorities have historically suffered from mainstream prejudice and the pandemic has aggravated socio-economic inequalities, instigated family and institutionalized abuse, apart from limiting access to essential care. This has resulted in acute mental distress which has overwhelmed queer support infrastructure across the country.

Speaking to queer collective representatives across India, I learned that the heightened levels of distress in the community was due to longstanding factors that were triggered under lockdown conditions. Family members who are intolerant of marginalized sexual identities, often tagging their orientation as a "disorder" or "just a phase", have always featured among the main perpetrators of subtle and overt forms of violence towards queer, trans and homosexual people.

Calls from lesbians and trans men to prevent forced marriages during lockdowns.

Sappho For Equality, a Kolkata-based feminist organization that works for the rights of sexually marginalized women and trans men, recorded a similar trend. Early in the first wave, the organization realized that the existing helpline number was getting overwhelmed with distress calls. It added a second helpline number. The comparative figures indicate a 13-fold jump in numbers: from 290 calls in April 2019-March 20 to 3,940 calls in April 2020-May 2021.

"Most of the calls we have been getting from lesbians and trans men are urgent appeals to prevent forced marriages during lockdowns," said Shreosi, a Sappho member and peer support provider. "If they happen to resist, they are either evicted or forced to flee home. But where to house them? There aren't so many shelters, and ours is at full capacity."

Shreosi says that the nature of distress calls has also changed. "Earlier people would call in for long-term help, such as professional mental health support. But during the pandemic, it has changed to immediate requests to rescue from oppressive home situations. Often, they will speak in whispers so that the parents can't hear."

Lack of spaces

Like many of his fellow queer community members, life for Sumit P., a 30-year-old gay man from Mumbai, has taken a turn for the worse. The lockdown has led to the loss of safe spaces and prolonged residence at home.

"It has been a really difficult time since the beginning of the lockdown. I am suffering from a lot of mental stress since I cannot freely express myself at home. Even while making a call, I have to check my surroundings to see if anybody is there. If I try to go out, my family demands an explanation. I feel suffocated," he said.

The pandemic has forced some queer people to come out

Sumit is also dealing with a risk that has hit the community harder than others – unemployment and income shortage. He's opened a cafe with two other queer friends, which is now running into losses. For others, pandemic-induced job losses have forced queer persons from all over the country to return to their home states and move in with their families who've turned abusive during this long period of confinement.

Lockdowns force coming out

According to Kolkata-based physician, filmmaker and gay rights activist Tirthankar Guha Thakurata, the pandemic has forced some queer people to come out, succumbing to rising discomfort and pressure exerted by homophobic families.

"In most cases, family relations sour when a person reveals their identity. But many do not flee home. They find a breathing space or 'space out' in their workspaces. In the absence of these spaces, mental problems rose significantly," he said.

Not being able to express themselves freely in front of parents who are hostile, intolerant and often address transgender persons by their deadname or misgender them has created situations of severe distress, suicidal thoughts and self-harm.

Psychiatrist and queer feminist activist Ranjita Biswas (she/they) cites an incident. A gender-nonconforming person died under suspicious circumstances just days after leaving their peer group and going home to their birth parents. The final rites were performed with them dressed in bangles and a saree.

"When a member of our community asked their mother why she chose a saree for someone who had worn androgynous clothes all their life, she plainly said it was natural because after all, the deceased 'was her daughter,'" Biswas recalls.

The Indian queer mental health support infrastructure, already compromised with historical prejudice, is now struggling

David Talukdar/ZUMA

"Correctional" therapy

In India, queer people's access to professional mental healthcare has been "very limited," according to community members such as Ankan Biswas, India's first transgender lawyer who has been working with the Human Rights Law Network in West Bengal.

"A large majority of the psychiatrists still consider homosexuality as a disorder and practice 'correctional therapy'. It's only around the big cities that some queer-friendly psychiatrists can be found," Biswas said. "The pandemic has further widened the inequalities in access to mental health support for India's LGBTQ community."

Biswas is spending anxious days fielding an overwhelming amount of calls and rescue requests from queer members trapped in their homes, undergoing mental, verbal and even physical torture. "We don't have the space, I just tell them to wait and bear it a little longer," he said.

Medical care is dismal

Anuradha Krishnan's story, though not involving birth family, outlines how the lack of physical support spaces have affected India's queer population. Abandoned by her birth family when she came out to them as a trans woman in 2017, Anuradha Krishnan (she/they), founder of Queerythm in Kerala who is studying dentistry, had to move into an accommodation with four other persons.

Isolation triggered my depression

"I am used to talking and hanging around with friends. Isolation triggered my depression and I had to seek psychiatric help." Living in cramped quarters did not help with quarantine requirements and all of them tested positive during the first wave.

What is deeply worrying is that the Indian queer mental health support infrastructure, already compromised with historical prejudice, is now struggling, placing more and more pressure on queer collectives and peer support groups whose resources are wearing thin.

During the 10 months of the first wave of the pandemic in India in 2020, Y'all, a queer collective based in Manipur, received about 1,000 distress calls on their helpline number from LGBTQ+ individuals. In May 2021 alone, they received 450 such calls (including texts and WhatsApp messages) indicating a telling escalation in the number of queer people seeking help during the second wave.

As India's queer-friendly mental health support infrastructure continues to be tested, Y'all founder, Sadam Hanjabam, a gay man, says, "Honestly, we are struggling to handle such a large number of calls, it is so overwhelming. We are also dealing with our own anxieties. We are burning out."

Sreemanti Sengupta is a freelance writer, poet, and media studies lecturer based in Kolkata.

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