Brad Wardell's site for talking about the customization of Windows.

imageI don’t like sounding like chicken little. Nevertheless, the sky is falling.

For those of you who don’t know me, I run one of the oldest independent software companies in the world. My specialty for the past 20 years has been in AI. It is my job to research, evaluate trends and invest accordingly to stay ahead of the curve. And I am here to tell you that the sky is falling.

It is automation. It is inevitable. It is irresistible. And if you think that automation always creates new opportunities look back to horses. Technology made them more useful too…for a time. Now it’s our turn and in this Facebook post I’m going to walk you through, in plain terms, why I think the sky is falling.

I’m not going to try to persuade you. I’m just going to put out the data. I suspect anyone reading this is intelligent enough to reach their own conclusions whether they agree with my assessment or not.

Before I begin, I want you to refer to this page: http://www.bls.gov/emp/ep_table_201.htm This is the Bureau of Labor statistics. It’s the government’s site that tracks what people are employed in.

To summarize we Americans work primarily in these areas:

1. Factory work (8%)

2. Construction (4%)

3. Retail (10%)

4. Transportation (3%)

5. Business Services (13%)

6. Healthcare (12%)

Next, I would like to quote you this statistic: “The maximum unemployment rate during the Great Depression was 25%.”

The sum of the percentages I give above is 50%. You be the judge on what percentage of the areas I am going to discuss below will likely be out of a job in the near future.

Like I said, my day job is to evaluate technology and try to predict where it’s going to go next. And with that, I am telling you the automation revolution isn’t happening soon. It’s happening right now.

Amazon Prime

Do you use Amazon Prime? It’s pretty great right? How are they able to do it so cheaply? It’s because it’s largely automated now. Over the past few years, Amazon has been quietly laying off thousands of employees and replacing them with machines.

http://www.techrepublic.com/article/amazon-robots-and-the-near-future-rise-of-the-automated-warehouse/

Amazon currently employs over 200,000 people, most of whom will be out of a job in less than five years. Right now, you go to their website, you order something. That signals a AGV to go over and pick it up in the warehouse which then takes it over to another AGV (automated guided vehicle) that in turn takes it over to the auto packager which in turn sends it to be sorted and packaged.

I’m not talking about some future technology either. Did you get something from Amazon Prime recently? Look at the box you received. You will see an MSI code and a Code-128 code (very similar) along with a Datamatrix code (a box with graphical blotches). Right now, some of this is still handled by a person. But this will soon be completely automated.

Right now, the Code 128 code is used by UPS or Fed Ex staff (people) to load trucks and get them to you. But this is not going to last much longer. The transportation industry is already in process of being automated. You don’t hear much on this publicly because no one wants to talk about it. But this isn’t a 10 or 20 year away thing. This transformation is happening right now.

Products and goods will soon be transported to you through autonomous vehicles. I’m not talking about drones. That’ll happen too but that’s a distraction. I mean that UPS trucks and Fed Ex trucks will soon be autonomous. Loaded at the warehouse by machines and transported to you by AFVs (autonomous freight vehicles).

And even if you think “how will they get up to my doorstep” remember most shipments occur from business to business who have their own loading docks and warehouses. Moving stuff from point A to point B is a huge part of our employment.

Going…going…gone

Retail, where a lot of people now work, is going to be hit soonest, hardest and most obviously. We are familiar with self-checkouts but that’s really not that big of a deal. It’s the stocking that is going to go away and you won’t even notice. Walmart, Target, you name it, will quietly and not-so-gradually replace their stock people with machines. Read a bar code, go to the proper location in the store and place it. 24 hours a day, 7 days a week.

Chain restaurants? The only reason why McDonalds and Burger King haven’t automated already is the relatively low minimum wage. But that’s going away. Kiosks will replace the order taking and the food preparation will be handled by machines. And machines in 2016, already do voice recognition better than most humans for the drive through (that’s something I never would have thought possible even 5 years ago). And people will be happy for this because it’ll be more convenient and the results more consistent. They’ll never “fuck you at the drive through” because the order will be perfect every time.

What about office jobs? They’re safe right? No. Again, I want to emphasize that I am not talking about some “20 years from now” thing. I am telling you that this automation revolution is happening as you read this. It’s not something to prepare for in the future. It’s already upon us. And with that in mind, Walmart just announced that it is cutting 7,000 office jobs.

http://fortune.com/2016/09/01/walmart-job-cuts-layoffs/

This was a week ago.

These are administrative jobs. Accounting jobs. All those jobs that involve paperwork, inventory management, producing invoices, handling payroll. Do these jobs sound familiar? They’re not going away in the future. They’re going away right now. And it’s accelerating.

Today, you walk into a Walmart and pick up a can of soup off the shelf. That soup was placed there by a person. You probably still go to a person to check it out because you have a bunch of stuff and it’s still a pain to do self-checkout. Nevertheless, everything you bought is automatically deducted from Walmart’s inventory. The acquisition of that item and its purchase doesn’t require people anymore so it was automated.

But relatively soon, every item, from food to your clothes, will have a tiny passive RFID tag in it. You’ll simply walk through a checkout and everything will be deducted automatically (for those with a NFC device like an iPhone or an Android phone). There will still be a person handling stuff for old people. But most people will naturally prefer to take their cart full of stuff through the RFID scanner and have it handled automatically.

Ironically, the service is likely to get better because they’ll probably soon have auto-baggers so you won’t even have to bag your own stuff anymore. But that’s probably around 7 (2023) years away from becoming mainstream. You’ll have RFID tagging sooner than that.

If you’re feeling stressed and want to go to the doctor, well, they’re going to be automated away too soon. And this will be a good thing for everyone. Today’s doctors will become more focused on dealing with patients’ needs while the machines handle the diagnosing and prescription writing.

You, reading this right now, when was the last time you went to the doctor not knowing what you already had? You probably just needed the prescription and had to wait. The machines, networked with each other across the world and able to sample billions of people’s anonymous data will make Dr. House look like an amateur and prescribe you with what you need vastly faster than having to wait for the doctor.

However, this won’t be good news for a lot of people in the health industry. Your doctor today with the thriving practice will be fine. He or she will save up and buy these diagnostic machines that will handle the vast majority of cases he or she currently handles. But those next generation doctors? They’re in for a rough time. Those in the medical profession can comment below and explain the problem a lot better than I can.

What about lawyers? They’re screwed. As someone who routinely gets sued (intellectual property is a mine field), I have a lot of experience with lawyers. The most expensive part, by far, is discovery. This is the part where each party sifts through the other’s sides stuff to determine what bullshit to put into their motions to convince a jury that their narrative of the case is the correct one. 99% of that time is wasted. Machines could handle that 99%.

It is unlikely that there will be such a thing as a paralegal in 20 years. They’ll go the way of the gas station attendant.

http://technoccult.net/archives/2013/10/08/report-47-of-u-s-jobs-at-risk-of-being-automated-out-of-existence/

Now, I’m not suggesting all these jobs are going to be gone in 5 years or even 20 years. Not all of them. But a lot of them. And unlike in the past, there’s no job for these people to go to. There’s no “training” for a new job because this time, the machines aren’t creating a new type of job in their wake, they are simply replacing the existing jobs without creating a new one.

We are not ready

We are not ready for this. We are oblivious now and we will remain oblivious until it’s far too late for our society to adapt carefully.

People will continue to be oblivious even as they watch their malls close down just like people shrugged when their bookstores went away.

http://time.com/money/4327632/shopping-malls-closing/

They’ll continue to be oblivious when their neighbor’s kid loses their job at the coffee shop because there’s a machine that makes the perfect Mocha Latte every single time.

They’ll still ignore it even as their sister’s husband loses his job at DHL (the world’s largest logistic company).

http://roboticsandautomationnews.com/2016/04/20/dhl-opens-supersize-logistics-centre-featuring-130-robotic-shuttles/4068/

They’ll only notice when their job at the local dentist’s office handling appointments and other office duties suddenly, without notice, disappears because Dr. Benning, such a great guy, has bought a Wavenet Office bot that can call patients to make appointments, reschedule, and handle all the tasks they previously did.

https://deepmind.com/blog/wavenet-generative-model-raw-audio/

And what about the unemployed? Think that they’ll just raise up a mob and take on the 5% of the population who owns the means of production now? Think again. The one area automation is already doing very well is security.

The new uber class (calling them rich isn’t even the right term at that stage) will be way ahead of the mob. They’ll have machines to protect their holdings, homes and families from the rabble. So those who think “they’ll have to do something for everyone else or they’ll be a revolution” think again. Don’t assume a universal basic income is a definite.

/">http://www.digitaltrends.com/cool-tech/security-robot-knightscope-/

What we do as a civilization, will define my generation. I pray we figure it out. Nothing scares me more than a future of split between the Gods and the Useless.

Further reading:

Economic Singularity


Comments (Page 2)
on Sep 13, 2016

eggsnbeans

Again with the horses example.

Just take a look at how horses live in develop countries. They have the best possible life ever. They do not work, they are the focus of rich people who love them and care them to degrees most people would ever dream of. All of that is exactly the result that horses don't have to work anymore. Same thing with dogs, just a fraction of them work right now.

Just take a look at how cheap leisure is right now. Games are cheap or free, Netflix is only 10 dollars. Those are hours and hours of fun. Social networks are fun for some people, and those are 100% free. Some economists even argue that cheap gaming and porn is the primary reason some men are out of the work force!

 The tractor killed most farming jobs, people just moved to other industries. Same thing would happen with this revolution. Always remember that it's easy to see which jobs are going to be destroyed, but it's really hard to predict which ones are going to be created.

How many horses are there now?

on Sep 13, 2016

Borg999


Further AI is far from being perfect. Look at recent incidents with driverless cars... I seriously doubt that it's "just around the corner". Companies are risk adverse, and there is still plenty of risk.

My Tesla Model X drove me 200+ miles this past weekend with me largely a passenger.  Two years ago, that would have been a ridiculous thing to imagine having by 2020.

on Sep 13, 2016

JcRabbit

We have a minimum wage here in Portugal. Doesn't really help having one if it's 500 Euros (about $560) *per month*. You can't live on that, you merely scrap by (well, at least you *might* not starve to death). And even though it's pretty obvious how ridiculous this amount is, the EU is totally against the Portuguese government raising it any further.

 

I don't mean a minimum wage, I'm talking about the universal basic income. Minimum wage causes problems by making labor more expensive which drives people towards automation for jobs that aren't worth the minimum wage. The universal basic income instead makes labor cheaper by satisfying the bare minimum amount that people need to survive, but does so without the overhead of bureaucracy, and also gets rid of the issue with welfare systems that make it so earning $1 more doesn't make you lose money in benefits.

Oh yeah, I forgot to mention that I did the US minimum wage calculations earlier this month. It's roughly $1260 per month in the US.

Frogboy

How many horses are there now?

9.2 Mililon horses exist now in the US. 33 thousand of them are Feral. One site I found said this was down from the peak of 21.5 million in 1915, but up from 1867 (8 million) and up from 1950 (3 million)

 

 

on Sep 13, 2016

The real big question to ask about this is what the net effect will be on the population, and how it will be affected. Personally, I think they would try to find a way to set it up so that the decrease in the necessity of humans matches the natural decrease in the population due to affluence. In the developed world we're already running into the problem of aging populations and a decreasing workforce because our people are prosperous enough that they don't feel like having many children. If the automation happens slowly enough, we might end up in a scenario where there's enough jobs for the people that are left, but there's not all that many people left in general because technology has taken over most of the jobs that it can take over.

It's not going to be a blood in the streets, lets kill all the useless people or let them starve sort of thing. 

Now the question is, how do you export this affluence and its resulting decrease in population wide enough?

This whole thing seems like the backdrop to John Ringo's Council Wars book series.

on Sep 14, 2016

Kazriko

I don't mean a minimum wage, I'm talking about the universal basic income. Minimum wage causes problems by making labor more expensive which drives people towards automation for jobs that aren't worth the minimum wage.
I think you are missing his point. I think the point is, that you don't need universal basic income (UBI) if it is only 500$ (or any other amount which is not enough) a month.

Kazriko

If the automation happens slowly enough, we might end up in a scenario where there's enough jobs for the people that are left, but there's not all that many people left in general because technology has taken over most of the jobs that it can take over.
Yes, but that's not what's happening. Natural change in population is in the range of <1% per year in the US within the last 50 years (wikipedia). If this should compensate for the 25 - 50% unemployed, it will be taking several decades, while the automation might have happened within the next 20 years.

And are we gonna see a natural decrease at all, if people have more time at home and need distraction from being 'the useless'?

I agree with you though, that it will probably not be blood in the streets. The average elite will push for something like a barely enough universal basic income - enough to keep people off the streets, not enough to make them feel happy or fullfilled.

on Sep 14, 2016

zuPloed


Quoting Kazriko,

I don't mean a minimum wage, I'm talking about the universal basic income. Minimum wage causes problems by making labor more expensive which drives people towards automation for jobs that aren't worth the minimum wage.

I think you are missing his point. I think the point is, that you don't need universal basic income (UBI) if it is only 500$ (or any other amount which is not enough) a month.

The point of a basic income isn't to make someone comfortable, but to allow them to survive and make it attractive for them to still try and find work. It does the latter by being barely enough for survival, but also by not disappearing if they do find other income.

zuPloed

Quoting Kazriko,

If the automation happens slowly enough, we might end up in a scenario where there's enough jobs for the people that are left, but there's not all that many people left in general because technology has taken over most of the jobs that it can take over.

Yes, but that's not what's happening. Natural change in population is in the range of <1% per year in the US within the last 50 years (wikipedia). If this should compensate for the 25 - 50% unemployed, it will be taking several decades, while the automation might have happened within the next 20 years.

And are we gonna see a natural decrease at all, if people have more time at home and need distraction from being 'the useless'?

I agree with you though, that it will probably not be blood in the streets. The average elite will push for something like a barely enough universal basic income - enough to keep people off the streets, not enough to make them feel happy or fullfilled.

It's something that happened before. The rise of Gin from the industrial revolution was partially to distract people from their uselessness, until the society readjusted and found ways for that class of people to contribute. Some people will figure it out earlier than others.

You may be correct on the population change, but incorrect about how it impacts the workforce. How many of those people will be retiring instead of dying? That is the biggest demographic shift. The population is getting older and there are fewer young people to do the work. The biggest age group alive is approaching retirement age now, and over the next decade or so.

on Sep 14, 2016

Kazriko

The point of a basic income isn't to make someone comfortable, but to allow them to survive and make it attractive for them to still try and find work. It does the latter by being barely enough for survival, but also by not disappearing if they do find other income.
Yes, but that's the point: What work? It is automated now.

Will all these people start studying? Will there be work for them when they are done?

Kazriko

You may be correct on the population change, but incorrect about how it impacts the workforce. How many of those people will be retiring instead of dying? That is the biggest demographic shift. The population is getting older and there are fewer young people to do the work. The biggest age group alive is approaching retirement age now, and over the next decade or so.
Will these retired be compensated for retiring early or are they gonna live under similar minimum universal base income conditions?

US demographic pyramid 2015:

Without people retiring earlier (a lot), there is not gonna be a big enough change in the workforce within the next 20 years. After that it depends on the current natural growth rates.

on Sep 14, 2016

zuPloed


Quoting Kazriko,

The point of a basic income isn't to make someone comfortable, but to allow them to survive and make it attractive for them to still try and find work. It does the latter by being barely enough for survival, but also by not disappearing if they do find other income.

Yes, but that's the point: What work? It is automated now.

Will all these people start studying? Will there be work for them when they are done?

 

There's always room and a small demand for artisanal hand-crafted goods, even if you can get dirt cheap mass produced products for cheaper.  There's still some fields that will be slower to take up automation. It's also trickier when you're first starting some business to actually get the automation in place, so things that are not routine will always need someone flexible up to the point where it makes sense to spend on the capital goods. The young are more inclined to work at startups anyway.

Of course, part of our problem at the moment is we've spent 8-9 years putting laws in place that drastically discourage new entrepreneurial activity and entrench the large corporations through regulation, and even directly handing money to these huge companies because they're "too big to fail." Unless we can stop doing that, none of this will work correctly. Old, crusty companies rarely provide job growth. That's almost entirely in small business, and small business is severely damaged by the banking environment our awful laws have created since 2008.

zuPloed

Quoting Kazriko,

You may be correct on the population change, but incorrect about how it impacts the workforce. How many of those people will be retiring instead of dying? That is the biggest demographic shift. The population is getting older and there are fewer young people to do the work. The biggest age group alive is approaching retirement age now, and over the next decade or so.

Will these retired be compensated for retiring early or are they gonna live under similar minimum universal base income conditions?

US demographic pyramid 2015:

Reduced 57%
Original 1024 x 768



Without people retiring earlier (a lot), there is not gonna be a big enough change in the workforce within the next 20 years. After that it depends on the current natural growth rates.

How the retired live largely depends on their own planning. Someone who has no retirement savings whatsoever would live off social security, and then would be living under those conditions. People who planned ahead though would be better off.

Note the larger lump towards the top of that graph, from the 50 to 67 range. 67 is the current retirement age, so that gives you 17 years until that large group retires. You were talking about 20 years in the last post. Just eye-balling it, that looks like about 30% of the workforce, which is in the 25-50% range you were highlighting, perhaps closer to the low end. The second big group has already entered the workforce, and the future ones seem to be getting smaller.

(Given that the markings on the chart indicate surpluses on of genders, it looks like men will have to start dating older women.)

on Sep 14, 2016

Kazriko

Note the larger lump towards the top of that graph, from the 50 to 67 range. [...] Just eye-balling it, that looks like about 30% of the workforce, which is in the 25-50% range you were highlighting
Good.

Now eye-ball the 3-20 region and subtract it from the retiring 50-67 region. Will the net change still be 30%? Will it even be over 10%? I would estimat this change to be about 5%. Don't forget, if we are looking at the work force, natural growth will have a delay of about 20 years: Even if everyone stopped having children right now, it wouldn't change anything for the workforce in 20 years.

Kazriko

People who planned ahead though would be better off.
I am not familiar with US retirement plans, so all I can do is drop this, I guess. I am sure everyone can afford retiring 5-10 years early. Especially these guys who worked in amazon packaging.

on Sep 14, 2016

I have consistently said precisely this, for 2 decades now.

http://www.scoop.it/t/concentration-of-wealth-existential-risk

Let's say I have come to accept my death of age and poverty and despair, as well the death of the premature majority of human beings on this planet. I have enough of warning people. Nobody cares.

on Sep 14, 2016

Stumbled across this little current example of "They're here..."

http://www.cbsnews.com/news/invasion-of-the-pizza-making-robots/

Wonder what the person who used to be standing there is doing for money now.

on Sep 14, 2016

Frogboy


Quoting Borg999,


Further AI is far from being perfect. Look at recent incidents with driverless cars... I seriously doubt that it's "just around the corner". Companies are risk adverse, and there is still plenty of risk.



My Tesla Model X drove me 200+ miles this past weekend with me largely a passenger.  Two years ago, that would have been a ridiculous thing to imagine having by 2020.

 

But if a driver has to be in the car, then no job is lost.

 

Some recent articles discussing driver-less cars.

http://www.businessinsider.com/uber-driverless-car-in-pittsburgh-review-photos-2016-9/#to-try-the-cars-we-lined-up-at-ubers-advanced-technologies-center-in-the-strip-district-of-pittsburgh-a-small-neighborhood-on-the-allegheny-river-with-nearby-warehouses-the-atc-is-tucked-under-an-overpass-for-a-freight-train-keeping-it-secluded-1

 

http://www.businessinsider.com/autonomous-cars-bridges-2016-8

 

http://www.businessinsider.com/autonomous-car-limitations-2016-8

on Sep 14, 2016

there's a big problem with minimum income. eligibility. it would work in a completely isolated country. or if there's unlimited resource. (which would make eligilibity an non-issue)

the idea isn't unsound, just probably unworkable in today's environment. i believe switzerland had a referendum on it and was rejected.

 

on Sep 14, 2016

There is kind of a bind with automation. If computers got good enough to not need people. If I was incharge maybe; otherwise, not going to happen, and this is why without me they haven't overcame the fact they can'tdeal with new variables. This is always going to happen requiring a manual override. If this is fully automated, and it was planned for it would regularly shut down sending a signal to the president of the company everyday. If there is no It, or whatever for that matter. Then he wouldn't be able to diagnose the problem not nowing who to call, or maybe this would be the new kind of president skill set. No way to describe a unforseen problem. We are going to still need people to do things the big people don't want to do.

Yes small business does seem to be the solution, and does seem to be a solution for other problems to. Framchising does seem to cause problems. I think small business; not, franchising, but bamks discourage small business, but prefer franchises.

Now let's assume that 50% of the work force is put out of work without some kind of supplementing income. SSI for everyone wether you qualify or not. First supplementing income would cause a lot of young people to stop working shrinking the work force. Without supplementing income their would be no demand for goods and services. This would almost stop. Without money coming in then businesses would go out of business. Causing another great depression. If small businesses were incouraged then they couldn't affordautomation, so this could still maintain the workforce. After the depression automation would be considered a society killer, and we would go back to before.

Or we could up the entertainment, or art industry where the place to work for humans is this. There are several ways the mind can take you here.

on Sep 14, 2016

I remember early in my Economics education, and periodically through my university career I would bring this up. As far I could tell it is something that nobody in charge of research, or policy takes seriously at all. 

Maybe the people's fears are over-stated, but nobody is actually looking into this. I was told once by a Ph.D student that anyone who is curious about this area is usually warned away, apparently this would be a career killer for most economists.

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