Technology Hindering Recovery in Job Market? , Sales Declines
Machines may be replacing humans in the workforce in the US, according to a report from Reuters. For decades, technology spending actually spurred job growth, as companies had to hire new workers to operate the machines they were building. But that trend appears to be reversing. Since 1999, total spending on equipment and software by American companies has increased 33 percent, but the number of people employed by private companies has not changed much at all.
This gap between technological innovation and workforce grew even wider after the Great Recession, which explains why the US is still struggling with an unemployment rate stuck above 9 percent. Throughout history, drastic changes in technology have led to changes in how people work. Britain's 19th century industrial revolution left skilled artisans without work, but led to mass employment at newly developed factories.
The current drought in the US job market, more than 10 years in, is raising questions about whether we are in the midst of a fundamental shift in the US job market's structure. Some of the labor market's woes can be attributed to displacement, rather than disappearance of jobs, as technological innovation has spawned a trend of companies outsourcing jobs to countries whose worker demand lower wages. Operations ranging from call centers to engineering departments are now commonly conducted overseas, and millions of Americans are unable to find jobs here at home.
Technology is also reducing the number of the most basic, entry-level positions in some sectors, such as retail. VDC Research released a report last week that US retailers will increase spending on self-checkout kiosks, which require less staff, by the year 2015. In Massachusetts, a grocery chain called Stop & Shop is testing out a new program that allows shoppers to use their smartphones to scan groceries as they pull them off of shelves, a move that could lead to even more job cuts.
|
