Monday, October 10, 2016

Where Are the Jobs Going?

“Daddy, I want to be an elevator operator when I grow up.”  “Daddy, I want to be a gas station attendant when I grow up.”  What is wrong with this picture?  We understand it now, but 50 years ago, though it might not have been an ambitious career choice, it was a possibility.

Today kids might grow up wanting to be an autoworker making $60 an hour including benefits.  Those jobs are disappearing as the older workers retire to be replaced by workers making more modest wages.  Today it takes an extreme combination of patience and luck to actually be able to speak to a human when trying to resolve a billing problem or check on an order.  (“Your business is very important to us, so please stay on the line and your call will be answered in the order in which it was received, or go to our website.”)  A good question to ask is, where are all the jobs going?  Some politicians say they are going overseas and south of the border, but when they come back, if they come back, will people do them?

These thoughts come as I look through a few recent articles.  “Walmart (WMT) has patented a robotic device that would create self-driving shopping carts, giving customers free hands while they shop. While that might benefit shoppers, the robot could lead to cutbacks in staff if it lives up to the potential highlighted in the patent, ranging from retrieving containers and abandoned items to helping with stocking and checking inventory.”  According to CBS News:  “A wave of automation is predicted to take 5.1 million jobs away from humans over the next five years, with low-paying, low-skill jobs considered those most at risk.”

In another instance, Zume Pizza, a Silicon Valley company, is using robots to prepare and cook their pizzas. This article calls it “the latest in a new trend within the food industry…to increasingly depend upon machines rather than human labor.”  The management says they are doing it for the employees, as they “eliminate boring, repetitive, dangerous jobs.”  Workers are still needed to prep the dough and measure out the cheese and other ingredients but the robots will soon be taking over those tasks too.  Robots will eventually remove pizzas from the oven, slice them, and box them for delivery – in self-driving cars perhaps.

In other related news, Foxconn, an electronics maker, recently cut around “60,000 factory jobs and replaced them with machines. And Wendy’s cited the rising cost of labor and competition among fast food chains as motivation for its own decision to replace some cashiers with kiosks.”

Meanwhile back at Walmart, they are also “eliminating about 7,000 store accounting and invoicing positions over the next several months.”  Mostly long-term employees held these highly sought-after and well paid jobs among Walmart’s hourly workforce.  There is also talk of a trend to cut back on middle management and support jobs in other industries.

Note how many of these changes can be made under the heading of improving customer service or giving the workers more challenging and rewarding jobs.

The question looms:  Will many of those jobs that may come back from Mexico, China and Vietnam only to be taken by robots, machines that can work 24/7 without vacations, require no government mandated health insurance and don’t give a hoot about the minimum wage?  It is something to thing about today instead of waiting 25 years to wonder what happened – both to the jobs themselves and to all those political promises about creating them.

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