Tuesday, July 28, 2015

New technologies-they destroy jobs? – Entrepreneurial Dynamics

Entrepreneurial Dynamics


they are destroying jobs technologies

The idea of ​​seeing technology destroy jobs is not new: it dates back to the early nineteenth century with the British Luddites. With the automation of tasks, fear resurfaced as evidenced by the survey that 74% of French people fear that the new technologies do not destroy their jobs. But can we establish a real link between technical innovations and rising unemployment?

A short-term negative effect

With automated processes, it becomes possible to produce more with fewer employees. The generalization of the machines in a sector leads unavoidably personal referrals.

There may be massive layoffs as in the automation of the automotive industry in the 1980 Products of innovations can also be a source of job destruction: the generalization of washing machines has greatly reduced the number of domestic workers, as ice sellers have disappeared with the arrival of freezers

. In 2014, a study by the consulting firm Roland Berger estimates that three million jobs could be lost in France by 2025 with robotics. In the building industry and agriculture in particular, automating tasks entail many job losses. Under this scenario, the unemployment rate would then be 18%.

A job engine long-term

However, the development of new technologies can be , long-term job creator. This hypothesis was formulated by the French sociologist and economist Alfred Sauvy with his theory of the spill that can approach the concept of creative destruction Joseph Schumpeter.

He considered that technical progress, improving productivity, induce over time a transfer of jobs to a sector of activity to another. This process was visible in France during the Industrial Revolution. With the mechanization of agricultural tasks, the share of employees in the primary sector in past century and a half from 65% to 3%.

At the same time, the labor force has increased dramatically in the secondary sector where new jobs are created. For thirty years, the increasing automation in the fields of industry and construction led the process to reproduce: the jobs lost in the manufacturing sector are re-created in the service sector

Uncertainties. in employment for the future

However, the spill is not mechanical theory and does not necessarily mean much job creation, as jobs destroyed by technical innovations . This process not only takes into account the impossibility for some people made redundant to find new employment.

The economist Jean Fourastié particular gives the example of a worker laid off by his robotics position who will struggle to retrain in information technology. Nothing says the spill theory can be applied to the current economic model. The Roland Berger study referred to above and is considering layoffs in almost all sectors. Three million more unemployed we count, it will be difficult to compensate.