One of the main factors which Donald Trump relied on in his campaign -- and that he now uses to justify his absurd anti-immigrant measures, the high taxes on imports and others -- was the promise of reducing job loss.

Nevertheless, according to official statistics of the United States, the greater part of the loss of employment in the US is due to the automatization and robotization of industries. The United States now produces 85 per cent more goods than it produced in 1987, but with a labour force two thirds of that which existed then (FRED Economic Data). The projection is that with greater use of systems of artificial intelligence, automatization will expand to more industries and sectors, eliminating still more jobs.

The industries that recently announced that they will remain or relocate plants to the United States, such as Ford and General Motors, already have an important part of their production automatized and will do so further. A great part of the supposed new “job positions” that will be created will in fact be done by robots. General Motors proudly claims to be the automobile industry that has most invested in new technologies, including the development of driverless cars, which will also result in fewer jobs (drivers, distribution of goods and other branches).

Carrier, that announced that two production plants for air conditioning equipment will remain in the United States instead of going to Mexico (which is presented as an achievement of Trump), recognized in the press that the fiscal incentives that Trump promised them will be used to notably increase the automatization of their factories, which means they will increase their profits in the medium range, while reducing the number of jobs (Business Insider 5/12/16). 

As president elect, the New York Times asked Trump if robots would replace the workers who voted for him. Trump happily agreed "They will, but we are also going to build the robots" (NYT, 23/11/16 https://tinyurl.com/juymes5). 

However, for now, the country that builds the most industrial robots in the world is China, which has already undertaken large investments in order to also become the first global producer of robots applied to agriculture and to new areas of industrial manufacture. (NYT 25/1/17 https://tinyurl.com/hwmd4p6).

The transfer of big industrial manufacturing plants to Mexico and other countries of the South in recent decades was due to the fact that the transnationals thus found ways of increasing their profits exponentially, by exploiting a situation of low and very low wages, abysmal labour conditions and rights and a terrain for scot-free contamination and environmental devastation, in addition to saving taxes in their homeland. All this was guaranteed and augmented with the free trade agreements.

The return of some industrial plants to the United States is based on a re-evaluation of the comparative advantages with respect to the present crises. No doubt Trump’s threat to impose high taxes on imports is one component, but the new wave of "intelligent" automatization plays a key role. If Trump, as he promised to businesses, subsidizes a more rapid development towards the new generation of intelligent automatization with money from the treasury, this doubtless makes up part of the profit equation for these companies. Clearly this also serves Trump as a supposed demonstration of strength and as an image that he is reversing the loss of jobs.

But the predictions on the quantity of jobs that will be lost by the industrial application of new forms of robotics and artificial intelligence in this country vary from 9 to 47 per cent, depending on the study that one takes as a reference. At the global level, recent reports of the OECD, Oxford University and the Davos Forum -- among those most quoted on this theme -- all foresee greater net loss of jobs than what has already happened, a tendency that they claim has accelerated since the year 2000. UNCTAD, the United Nations Conference on Trade and Development, foresees that in the so-called developing countries, up to two thirds of jobs could be replaced by robots 

(UNCTAD 2016, https://tinyurl.com/zu2r3vc).

But automatization and robotics are far from being novelties. The "newness" is the exponential leap in the development of artificial intelligence and the convergence with this and other new technologies, such as nano and biotechnology, that is expanding beyond industrial manufacture, to agriculture and food, transport, communication, services, trade, extractive industries, among other key sectors; with multiple impacts on the environment, health and also on employment.

This is a process of convergence that in the ETC Group we have been calling BANG since 2001 (bits, atoms, neurons, genes) and that the Davos Forum since 2016 calls the "fourth industrial revolution". The automatization of the last few decades has involved an increase in productivity, but not in social welfare, quite the opposite: wage stagnation and increased inequality. Note that of the eight richest men on the planet -- who concentrate more wealth than half of the world population -- the majority are businessmen from the computing sector or whose activity is closely tied to digitalization and robotization.

And according to the aforementioned reports, the expansion of the new wave of "intelligent" automatization will eliminate more jobs than will be created, also affecting different sectors to those that were already being substituted by it. How Trump intends to resolve this contradiction is an enigma.

20/02/2017  

(Translated for ALAI by Jordan Bishop) 

- Silvia Ribeiro, Researcher with the ETC Group

www.etcgroup.org