×

Don’t fear the robots, tech creates jobs: Report

Those modern day luddites complaining that technology is taking people's jobs may have to eat their hat. Research by economists shows technology has created more jobs than it's destroyed—and they have 140 years of data to prove it.

Data complied by management consultants Deloitte from the census data for England and Wales stretching back to 1871 suggest that the growth of jobs in the creative, care, tech and business service industries have more than offset the loss of jobs in the agricultural and manufacturing sectors.


A robot carrying food to customers in a restaurant in Kunshan, China.
Johannes Eisele | AFP | Getty Images
A robot carrying food to customers in a restaurant in Kunshan, China.

The report, which was shortlisted for an economics prize earlier this year, focused on the employment numbers between sectors that have either been hit or helped by technology.

"It's been very easy to identify where jobs have been destroyed. Job losses generally are very conspicuous, whether it's a middle manager replaced by software, or checkout staff displaced by auto terminals, whereas job gains harder to identify," Ian Stewart, a chief economist at Deloitte, and one of the three authors of the report, told CNBC.

For example, 6.6 percent of the U.K. workforce was classified as agricultural workers in 1871. That number has fallen by 95 percent to 0.2 percent in 2011. Manufacturing jobs have dropped from 38 percent of the labor force in 1948 to 8 percent in 2012, Stewart said.

Deloitte (Source: England and Wales Census records, authors’ calculations)

Meanwhile, the number of accountants counted in the U.K. in 2011 was over 2,000 percent higher than it was 140 years ago, the report showed.

Technology has also complemented industries like medicine and management consultancy, where it has boosted productivity and subsequent demand for these specializations has increased, Stewart explained.

Since 1992 alone, U.K. Labour Force Survey data shows a 909 percent increase in nursing auxiliaries and assistants, and a 580 percent increase in teaching staff. That's against a 82 percent decline in footwear and leather trade positions and a 79 percent slide in weavers and knitters.

Stewart also emphasized the effect of technology on consumer behavior. As machines replace labor, and products become cheaper, consumers are throwing their money at new products and services.


Deloitte

"They spend it on entirely unthought-of new areas: gym membership, short holidays, and overpriced coffees. Those sectors in turn create new employment."

"Human desires are infinite," Stewart explained. "And once we have enough food to eat, 100 pairs trousers, we look for more. I wouldn't bet against the evolution of human desire."

But the future of work isn't entirely rosy, with the report predicting that income inequality will widen as economies increasingly reward high level education and skills that can service a high-tech society.

It will require governments to review education and training policies as well as income distribution schemes, Stewart said.

"I'm not saying tech is answer to everything, but there's very strong evidence of job creation."