Giving Compass' Take:

• Robert E. Litan shares strategies to prevent economic disaster in the automation economy by working to protect workers.

• How can philanthropy support the implementation of these ideas? How else can we prepare for the automation economy? 

• Find out how local workforce systems can support lifelong learning. 

Last year, the Pew Center reported that 72 percent of Americans said they were worried about the impact of automation on jobs – this, despite the unemployment rate at the time being at a twenty-year low (and even lower since).

The fears of a jobless dystopia are misplaced. Despite cyclical ups and downs, economies generate new jobs to replace the old ones disrupted by technological change (or by “globalization,” or increased competition from firms in other countries). There are multiple reasons for this, as outlined in my new paper “Meeting the Automation Challenge to The Middle Class and the American Project,” but the simplest is that the savings enabled by automation do not disappear into thin air. They get spent on other goods and services, which creates more jobs elsewhere in the economy.

The real concern about automation is the wages those new jobs pay, or more precisely, on the distribution of those wages. If, as automation proceeds, it continues to favor those especially able to use it at the expense of those who don’t have those skills – in economists’ language continues to be “skills biased” – it will further widen income inequality.

  1. Maintain a high-pressure economy.
  2. Insure wages.
  3. Finance lifetime learning
  4. Target distressed places.

Read the full article about automation anxiety by Robert E. Litan at Brookings.