Is Technology Killing Middle-Income Jobs in the US - Essay Example

?Is Technology Killing Middle-Income Jobs in the U.S? The global financial crisis that commenced near the end of the year 2007 has had tremendous adverse impacts on the economy. Almost five years have passed since the commencement of the global financial crisis and the consequences are still quite noticeable in many parts of the world in general and the US in particular. Hundreds of thousands of middle-class jobs have vanished in the developed economies all over the world. Growth of middle-class jobs in the US has come to a halt, incomes of the middle-class workers have stagnated, inequality among the workers has increased to alarming levels whereas the middle class workers have been splintered with the disappearance of more jobs. While some middle-class workers have joined the top levels of income, a greater number of the middle-class workers have been pushed down to the lower-wage and lower-skill service jobs (Zaccone 1). The actual situation is worse than what it seems to be when studied from the surface. A vast majority of the jobs that have been lost are the ones that might never return, and the experts of the labor market consent that more of them are expected to disappear in the near future (Condon and Wiseman). These jobs from the US are neither only being lost to such developing countries as China nor are they simply factory work. These jobs are increasingly being lost in the service sector that is home to almost two-thirds of all middle-class workers in the US. Technology is rapidly obliterating these jobs. “If it’s not solved, then in the coming decades you can expect a self-perpetuating privileged elite to accrue more and more of the wealth generated by software and robots, telling themselves that they’re carrying the entire world on their backs” (Evans). Science fiction has been warning of a future in which man would design his own obsolescence as he would be replaced by machines for decades, and that future has already become the present. The influence of technology on the contemporary systems and organizations is tremendous. Indeed, many of the contemporary systems fundamentally depend upon technology. Benefits derived from the use of technology in the workplace include but are not limited to improved productivity, improved and consistent quality of work, increased reliability of work, and streamlining and organization of different units in the system. Use of technology has benefited the entrepreneurs in two fundamental ways; firstly, it has increased the productivity and quality of work so that there are no reworks and wastage of time, and secondly, increased dependence on technology has reduced the need for manual labor, thus cutting down the costs of businesses by obviating the need for the entrepreneurs to pay the workers. While on one hand, this has made the circumstances extremely favorable for the entrepreneurs and business owners, the situation is far worse for the workers on the other hand. The richest 1 per cent of the Americans have experienced a growth of 33 per cent in their income over the last two decades and have thus left a vast majority of the average Americans in the dust (Censky). “Today the top 1 percent of Americans control 43 percent of the financial wealth…while the bottom 80 percent control only 7 percent of the wealth” (“American Pie”). The widening gap between the rich and the poor is explained by two fundamental factors; globalization and technological advancement. Contemporary organizations are tremendously dependent upon the technology which can in part be attributed to the rapid advancement of technology. Software that are employed in running the computers and a host of devices and machines are upgraded every single year so that they become more powerful and sophisticated. One of the main objectives of designing and introducing new models in the market is to improve the machines’ capability of performing the tasks traditionally performed by manual workforce more efficiently. “The jobs that are going away aren't coming back. I have never seen a period where computers demonstrated as many skills and abilities as they have over the past seven years.” (McAfee cited in Condon and Wiseman). Machines that are used to generate and evaluate data in enormous amounts are reshaping the global economy. Such machines include but are not limited to tablet computers and smartphones that provide the users with the facility to work almost anywhere in any kind of setting. These machines offer services that allow the businesses to rent the power of computing as the need arises rather than having to install expensive equipment and recruit and allocate skilled IT staff for its operation. Different categories of employment ranging from the travel agents to the secretaries are starting to vanish. “There's no sector of the economy that's going to get a pass. It's everywhere” (Ford cited in Condon and Wiseman). Technology has been reducing the scope of manual labor in the jobs of manufacturing for over three decades now. The advent of computer in general and the Internet in particular are some of the most fundamental and important advancements in technology that have replaced manual services with the technological services. While this has led to increase in work opportunities on different levels, growth of opportunities for the middle-class workers has been relatively quite limited. “There is an abundance of work to do in food service and there is an abundance of work in finance, but there are fewer middle-wage, middle-income jobs” (Autor cited in Freeland). Robots and computer driven machines have been integrated into the work systems rapidly because they provide a lot of benefits over the traditional manual labor system; not only machines produce more work in lesser time, the quality of work is always same and high and there is no rework because of lack of mistakes on the part of the machines. The service economy that provides employment to over two-thirds of the developed countries’ total workforce has started to unleash the same efficiency. Every day, many jobs in retail establishments, office buildings, and different kinds of businesses are eliminated because of the incorporation and use of technology in the workplace. Every type of organization in which people are employed is adopting technology these days. Workers in small businesses as well as large corporations are being replaced and new companies are being established. Technology is omnipresent; in schools, hospitals, profit and nonprofit organizations. A considerable extent of the job growth in the advanced economies can be attributed to the start-ups. However, entrepreneurs are increasingly using the software to establish businesses with very few employees than what it took to launch a business in the past. Many companies have customized software that centrally control the organizations and all of the systems on which the work depends. Today, lesser administrative support is required as a result of which, there has occurred a decline in the number of back-office jobs that handle such subjects as payroll, benefits, and accounting. Contemporary business has taken the form of a self-serve world with minimal need of and dependency upon the workforce. Rather than relying on other people in the personal lives or workplace, entrepreneurs have started to use technology for performing the tasks. For some entrepreneurs particularly those who are used to the traditional way of working with huge dependency on the workforce, increased dependence on technology rather than workforce is frustrating whereas others like the feeling of self-sufficiency and empowerment that comes with the use of technology. Growth in this trend is expected with the increased permeation of software in human life. Workers in the developed countries including the US are being replaced by the technology irrespective of their policies, laws, and politics. Although the labor laws and union rules tend to retard the process of employees’ dismissal, yet countries like the US do not attempt to prohibit the organizations from the use of technology that is deemed useful for the organization even if that limits the number of employees. “The pre-eminent political and economic challenge in the industrialized democracies is how to make capitalism work for the middle class” (Freeland). Critics refute the idea that technology kills jobs. A vast majority of the critics emphasize on the positive impacts of use of technology in the organization and base their refutation of the impact of technology on the employability of the middle-class workers in the US on the collapse of the market of housing in the US and several other countries including Spain and Ireland, and the fact that the latest global financial crisis got millions of middle-class factory and construction jobs wiped out. Critics think that many of the vanished jobs can be brought back by the government if such concerns as spending more and heavy debts are placed aside. However, the role of technology in the decline in the number of middle-class jobs to a certain extent cannot be denied. Even after the end of the global financial crisis as the growth of economy has accelerated, technology has raised the high unemployment’s specter. According to some economists, certain middle-class workers need skill development, counseling, and retraining to be able to perform in other jobs if there is any hope of the recovery of the lost jobs. Paul Kedrosky discussed the cultural technical debt in these words, “Organizations or technologies that persist, largely for historical reasons, not because they remain the best solution to the problem for which they were created. They are often obstacles to much better solutions” (Kedrosky cited in Evans). Technology is frequently compared to trade with respect to its impact on the employment status of the middle-class workers in the US. It is often assumed that technology and trade go side by side. Since technology is required for trade, outsourcing in the present age cannot be imagined without the use of the Internet, jet travel, and use of sophisticated systems of logistics. Technology depends heavily on trade as well. One reason for the yielding of such outsize rewards by the technological innovation is the opportunity for the global scale. However, an in-depth analysis of the local labor markets of the US has led three academics to the conclusion that technology and trade impact jobs differently. “We were surprised at how distinct the two were. We found that the trade shock had a very measurable impact on the employment rate. Technology led to job polarization, but its employment effect was minimal” (Autor cited in Freeland). Of the two, trade has caused more harm to the middle-class workers in the US as well as many other advanced countries around the world. Trade actually shipped the jobs overseas in the short term at least. Although technology has not altogether killed the jobs, yet it has hollowed the essential jobs out in the middle. Concluding, while the positive impact and contribution of technology in the development of society as a whole and individual organizations in particular cannot be overemphasized, it is indeed a harsh reality that loss of many middle-class jobs in the US is attributed to the use of technology in the workplace. As the organizational productivity has increased as a result of use of technology in place of manual work, many middle-class workers in the US had no choice but to choose alternate professions or fields where there was still scope. If the lost jobs reappear after several years of absence, the old workers might need retraining and short courses to catch up with their lost skills. A very optimistic estimate leads to the conclusion that the loss of middle-class jobs in the US because of the integration of technology in the workplace is temporal; in the long run, more jobs would be created than what have lost in the past few decades. However, even if that is true, it would take very long for the new jobs to outnumber the old lost ones. Under the present conditions, the US and much of the developed world would face several years of unemployment of the middle-class workers, divisive politics, social discord, declined standard of living, and lost hope. Considering the adverse impact on the organizations’ dependency of technology and the rapid advancement of technology on the employability of the middle-class workers in the US, there is urgent need to take measures to protect their employability. Works Cited: “American Pie: Wealth and Income Inequality in America.” N.d. Web. 19 Feb. 2013. . Censky, Annalyn. “How the middle class became the underclass.” CNN Money. 16 Feb. 2011. Web. 19 Feb. 2013. . Condon, Bernard, and Wiseman, Paul. “AP IMPACT: Recession, tech kill middle-class jobs.” My Way. 23 Jan. 2013. Web. 19 Feb. 2013. . Evans, Jon. “America Has Hit “Peak Jobs”” 26 Jan. 2013. Web. 19 Feb. 2013. . Freeland, Chrystia. “Trade and technology as middle class job killers.” The Globe and Mail. 14 Feb. 2013. Web. 19 Feb. 2013. . Zaccone, June. “Has Globalization Destroyed the American Middle Class?” n.d. Web. 19 Feb. 2013. . Read More