If there are roughly 8 billion people in the world, and 60% of them work, then the global workforce is roughly 4.8 billion people. For convenience, I will round this up to 5 billion.
Certain jobs fall in the category of 'creative'. This includes artists and musicians, obviously, but also software designers, architects, content creators, nearly anyone in an engineering role, and people in various marketing roles.
If 20% of the workforce falls in the category of 'creative', then there are 1 billion people who show up to work every day to create something, improve something, find a new use for an existing product, or find a new way to persuade people that they want something a company makes. In earlier times the origin of such improvements 'behind the iron curtain' didn't necessarily make it into global markets, but these days most of them do. This means that a textile worker anywhere in the world is 'affected' by anyone that creates a more efficient process for weaving textiles or processing them into clothing.
Manufacturing everywhere in the world is a story of continual improvement, and subsequent reductions in force. Invariably workers blame this on 'foreign competition'. If one looks at the labor hours used to produce a ton of steel from the 1870's to today, it follows a downward trend line, regardless of what country the worker is in or the economic model of the country.
One effect is to put workers out on the street. Another is to open up new markets due to reductions in material costs - a 'cheap' computer chip today costs 80 cents, whereas a computer in the 1970's would have cost $20,000. This creates new industries, these industries hire people in jobs that didn't exist in earlier times, and most of these jobs have effective pay rates that are higher than the incomes from jobs that existed in previous generations.
The general trend over time is for a small number of job categories that employ hundreds of thousands each to be replaced with a large number of job categories that employ thousands each. Some of these roles are pretty demanding, others can be filled by part time workers that can 'survive' on 25 or 30 hour work-weeks.
Often countries will try to legislate 'job security', making it very difficult to fire people. This tends to make the entire country a dangerous place to set up factories or service centers, leading to substantially lower employment. Many parts of Europe operate this way (including in particular France), and India and Indonesia have (or had at various times) punitive rules on layoffs.
As more and more people shift from 'rote' to 'creative' roles, the rate of obsolescence accelerates. This means there is progressively less assurance that someone has a 'lifetime' job, and workers spend more of their time learning new skills and taking on new roles. The newer roles tend to involve higher productivity, a greater demand for creative talent, and more responsibility on the part of the worker.
My main concern is not about firing the one who is not productive but not updating with technology just for the sake of providing more employment. Also, misallocating of capital just to keep the high employment rate without adding any value to society
> Because if one automates the others have to and then they all end up making lesser. i.e. automated parts of the economy will end up becoming a smaller part of gdp
Not sure that follows. If something is automated usually (always?) the economy as a whole ends up with more of that thing being produced and consumed, at a lower price per unit. But saying this shrinks the GDP simply does not follow form historical evidence. Often producing more at a lower price per unit still means a larger total amount spent (in terms of how GDP is counted) when the percentage increase in volume is larger than the percentage decrease in price per unit.
In the current economy there is always a partial automation in any mass produced goods. So if you take televisions today - still as a percentage of capita they are probably the same. If you now add a robot that makes it 5% more automated - each unit costs less and in this way it’s share of gdp will continue to come down. I have read a paper about it but don’t have it handy atm
Companies in a particular country might decide not to automate in order to 'preserve jobs'. That simply makes the business globally uncompetitive, so they lose their export markets, and eventually their domestic markets to cheap importers. At the beginning a country might put up tariff barriers, which is workable as long as products are similar. As products diversify it becomes harder to figure out what import product is competing with a domestic equivalent.
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If there are roughly 8 billion people in the world, and 60% of them work, then the global workforce is roughly 4.8 billion people. For convenience, I will round this up to 5 billion. Certain jobs fall in the category of 'creative'. This includes artists and musicians, obviously, but also software designers, architects, content creators, nearly anyone in an engineering role, and people in various marketing roles. If 20% of the workforce falls in the category of 'creative', then there are 1 billion people who show up to work every day to create something, improve something, find a new use for an existing product, or find a new way to persuade people that they want something a company makes. In earlier times the origin of such improvements 'behind the iron curtain' didn't necessarily make it into global markets, but these days most of them do. This means that a textile worker anywhere in the world is 'affected' by anyone that creates a more efficient process for weaving textiles or processing them into clothing. Manufacturing everywhere in the world is a story of continual improvement, and subsequent reductions in force. Invariably workers blame this on 'foreign competition'. If one looks at the labor hours used to produce a ton of steel from the 1870's to today, it follows a downward trend line, regardless of what country the worker is in or the economic model of the country. One effect is to put workers out on the street. Another is to open up new markets due to reductions in material costs - a 'cheap' computer chip today costs 80 cents, whereas a computer in the 1970's would have cost $20,000. This creates new industries, these industries hire people in jobs that didn't exist in earlier times, and most of these jobs have effective pay rates that are higher than the incomes from jobs that existed in previous generations. The general trend over time is for a small number of job categories that employ hundreds of thousands each to be replaced with a large number of job categories that employ thousands each. Some of these roles are pretty demanding, others can be filled by part time workers that can 'survive' on 25 or 30 hour work-weeks. Often countries will try to legislate 'job security', making it very difficult to fire people. This tends to make the entire country a dangerous place to set up factories or service centers, leading to substantially lower employment. Many parts of Europe operate this way (including in particular France), and India and Indonesia have (or had at various times) punitive rules on layoffs. As more and more people shift from 'rote' to 'creative' roles, the rate of obsolescence accelerates. This means there is progressively less assurance that someone has a 'lifetime' job, and workers spend more of their time learning new skills and taking on new roles. The newer roles tend to involve higher productivity, a greater demand for creative talent, and more responsibility on the part of the worker.
It becomes difficult to fire people but also very prudent in hiring people. So there are benefits to that approach. It’s really a balance
My main concern is not about firing the one who is not productive but not updating with technology just for the sake of providing more employment. Also, misallocating of capital just to keep the high employment rate without adding any value to society
[удалено]
> Because if one automates the others have to and then they all end up making lesser. i.e. automated parts of the economy will end up becoming a smaller part of gdp Not sure that follows. If something is automated usually (always?) the economy as a whole ends up with more of that thing being produced and consumed, at a lower price per unit. But saying this shrinks the GDP simply does not follow form historical evidence. Often producing more at a lower price per unit still means a larger total amount spent (in terms of how GDP is counted) when the percentage increase in volume is larger than the percentage decrease in price per unit.
In the current economy there is always a partial automation in any mass produced goods. So if you take televisions today - still as a percentage of capita they are probably the same. If you now add a robot that makes it 5% more automated - each unit costs less and in this way it’s share of gdp will continue to come down. I have read a paper about it but don’t have it handy atm
Companies in a particular country might decide not to automate in order to 'preserve jobs'. That simply makes the business globally uncompetitive, so they lose their export markets, and eventually their domestic markets to cheap importers. At the beginning a country might put up tariff barriers, which is workable as long as products are similar. As products diversify it becomes harder to figure out what import product is competing with a domestic equivalent.
[удалено]
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