David Goldman/Associated Press
David Goldman/Associated Press
Editor’s note: This is the second report in a three-part series on the loss of middle-class jobs in the wake of the Great Recession and the role of technology.
By PAUL WISEMAN, BERNARD CONDON and JONATHAN FAHEY
AP Business Writers
WASHINGTON – Art Liscano knows he’s an endangered species in the job market: He’s a meter reader in Fresno, Calif. For 26 years, he’s driven from house to house, checking how much electricity Pacific Gas & Electric customers have used.
But PG&E doesn’t need many people like Liscano making rounds anymore. Every day, the utility replaces 1,200 old-fashioned meters with digital versions that can collect information without human help, generate more accurate power bills, even send an alert if the power goes out.
“I can see why technology is taking over,” said Liscano, 66, who earns $67,000 a year. “We can see the writing on the wall.” His department employed 50 full-time meter readers just six years ago. Now, it has six.
From giant corporations to university libraries to start-up businesses, employers are using rapidly improving technology to do tasks humans used to do. That means millions of workers are caught in a competition they can’t win against machines that keep getting more powerful, cheaper and easier to use.
To better understand the impact of technology on jobs, The Associated Press analyzed employment data from 20 countries; and interviewed economists, technology experts, robot manufacturers, software developers, CEOs and workers who are competing with smarter machines.
The AP found most disappearing jobs pay middle-class wages, ranging from $38,000 to $68,000 – jobs that form the backbone of the middle class in developed countries in Europe, North America and Asia.
In the United States, half of the 7.5 million jobs lost during the Great Recession paid middle-class wages, and the numbers are even more grim in the 17 European countries that use the euro as their currency. A total of 7.6 million mid-pay jobs disappeared in those countries from January 2008 through last June.
Those jobs are being replaced in many cases by machines and software that can do the same work better and cheaper.
“Everything that humans can do a machine can do,” says Moshe Vardi, a computer scientist at Rice University in Houston. “Things are happening that look like science fiction.”
Google and Toyota are rolling out cars that can drive themselves. The Pentagon deploys robots to find roadside explosives in Afghanistan and wages war from the air with drone aircraft. North Carolina State University this month introduced a high-tech library where robots – “bookBots” – retrieve books when students request them, instead of humans. The library’s 1.5 million books are no longer displayed on shelves; they’re kept in 18,000 metal bins that require one-ninth the space.
A double-edged sword
The advance of technology is producing wondrous products and services that once were unthinkable. But it’s also taking a toll on people because they so easily can be replaced.
In the United States, more than 1.1 million secretaries vanished from the job market between 2000 and 2010, their job security shattered by software that lets bosses field calls themselves and arrange their own meetings and trips. During the same period, the number of telephone operators plunged by 64 percent, word processors and typists by 63 percent, travel agents by 46 percent and bookkeepers by 26 percent, according to Labor Department statistics.
In Europe, technology is shaking up human resources departments across the continent. “Nowadays, employees are expected to do a lot of what we used to think of as HR from behind their own computer,” said Ron van Baden, a negotiator with the Dutch labor union federation FNV. “It used to be that you could walk into the employee-affairs office with a question about your pension, or the terms of your contract. That’s all gone and automated.”
Two-thirds of the 7.6 million middle-class jobs that vanished in Europe were the victims of technology, estimates economist Maarten Goos at Belgium’s University of Leuven.
Does technology also create jobs? Of course. But at nowhere near the rate that it’s killing them off – at least for the foreseeable future.
Here’s a look at three technological factors reshaping economies and job markets:
At the heart of the biggest technological changes is what computer scientists call “Big Data.” Computers thrive on information, and they’re feasting on an unprecedented amount of it – from the Internet, from Twitter messages and other social-media sources, from the barcodes and sensors being slapped on everything from boxes of Huggies diapers to stamping machines in car plants.
According to a Harvard Business Review article by Andrew McAfee and Erik Brynjolfsson of the Massachusetts Institute of Technology, more information now crosses the Internet every second than the entire Internet stored 20 years ago. Every hour, they note, Wal-Mart Stores Inc. collects 50 million filing cabinets’ worth of information from its dealings with customers.
No human could make sense of so much data. But computers can. They sift through mountains of information and deliver valuable insights to decision-makers in businesses and government agencies. For example, Wal-Mart’s analysis of Twitter traffic helped convince it to increase the amount of “Avengers” merchandise it offered when the superhero movie came out last year and to introduce a private-label corn chip in the American Southwest.
Google’s automated car can drive by itself by tapping into Google’s vast collection of maps and using information pouring in from special sensors to negotiate traffic.
“What’s different to me is the raw amount of data out there because of the Web, because of these devices, because we’re attaching sensors to things,” said McAfee, principal research scientist at MIT’s Center for Digital Business and the co-author of Race Against the Machine.
“The fuel of science is data,” he said. “We have so much more of that rocket fuel.”
In the old days – say, five years ago – businesses that had to track lots of information needed to install servers in their offices and hire technical staff members to run them. “Cloud computing” has changed everything.
Now, companies can store information on the Internet – perhaps through Amazon Web Services or Google App Engine – and grab it when they need it. And they don’t need to hire experts to do it.
Cloud computing “is a catch-all term for the ability to rent as much computer power as you need without having to buy it, without having to know a lot about it,” McAfee said. “It really has opened up very high-powered computing to the masses.”
Small businesses with few resources for a big technology department, are especially eager to take advantage of cheap cloud computing.
Hilliard’s Beer in Seattle, founded in October 2011, bought software from the German company SAP that allows it to use cloud computing to track sales and inventory and to produce the reports that federal regulators require.
“It automates a lot of the stuff that we do,” owner Ryan Hilliard said. “I know what it takes to run a server. I didn’t want to hire an IT guy.”
And the brewery keeps finding new ways to use the beefed-up computing power. For example, it’s now tracking what happens to the kegs it delivers to restaurants and retrieving them sooner for reuse. “Kegs are a pretty big expense for a small brewery,” Hilliard said.
Though many are still working out the kinks, software is making machines and devices smarter every year. They can learn your habits, recognize your voice, do the things that travel agents, secretaries and interpreters have traditionally done.
Microsoft has unveiled a system that can translate what you say into Mandarin and play it back – in your voice. The Google Now personal assistant can tell you if there’s a traffic jam on your regular route home and suggest an alternative. Talk to Apple’s Siri and she can reschedule an appointment. IBM’s Watson supercomputer can field an awkwardly worded question, figure out what you’re trying to ask, retrieve the answer and spit it out fast enough to beat human champions on the TV quiz show “Jeopardy!” Computers with that much brainpower increasingly will invade traditional office work.
Beside becoming more powerful and creative, machines and their software are becoming easier to use. That has made consumers increasingly comfortable relying on them to transact business. As well as eliminated jobs of bank tellers, ticket agents and checkout cashiers.
People who used to say “Let me talk to a person. I don’t want to deal with this machine” are now using check-in kiosks at airports and self-checkout lanes at supermarkets and drugstores, said Jeff Connally, CEO of CMIT Solutions, a technology consultancy.
The most important change in technology, he said, is “the profound simplification of the user interface.”
Four years ago, the Darien, Conn., public library bought self-service check-out machines from 3M Co. Now, with customers scanning books themselves, the library is processing more books than ever while shaving 15 percent from staff hours by using fewer part-time workers.
So machines are getting smarter and people are more comfortable using them. Those factors, combined with the financial pressures of the Great Recession, have led companies and government agencies to cut jobs during the last five years, yet continue to operate just as well.
How is that happening?
Reduced aid from Indiana’s state government and other budget problems forced the Gary, Ind., public schools last year to cut its transportation budget in half, to $5 million. The school district responded by using sophisticated software to draw new, more efficient bus routes. And it cut 80 of 160 drivers.
When the Great Recession struck, the Seattle police department didn’t have money to replace retiring officers. So it turned to technology – a new software system that lets police officers file crime-scene reports from laptops in their patrol cars.
The software was nothing fancy, just a collection of forms and pull-down menus, but the impact was huge. The shift from paper eliminated the need for two dozen transcribers and filing staff members at police headquarters, and freed desk-bound officers to return to the streets.
“A sergeant used to read them, sign them, an officer would photocopy them and another drive them to headquarters,” said Dick Reed, assistant chief for technology. “Think of the time, think of the salary. You’re paying an officer to make photocopies. ”
Dave Martin/Associated Press