Job Displacement

Extracted Attributes

• Definition

  Loss of jobs resulting from technological advancements, particularly automation and labor-saving machinery, or changes in organizational needs like restructuring or downsizing.

• Keynes' View

  Only a temporary phase of maladjustment

• Also Known As

  Technological unemployment

• Optimist View

  Innovation may be disruptive in the short term, but compensation effects ensure no long-term negative impact on jobs; technological innovation ultimately creates more jobs and industries.

• Broader Causes

  Economic downturns, company restructuring, offshoring

• Pessimist View

  New technologies can lead to a lasting decline in the total number of workers in employment.

• Related Fallacy

  Luddite fallacy

• Debate Participants

  Optimists, Pessimists

• Contemporary Examples

  Self-service checkouts replacing retail cashiers, cashierless stores

• Historical Precedents

  Artisan weavers reduced to poverty after mechanized looms, bombe codebreaking machine

• Mitigation Strategies

  Retraining programs, enhancing job matching, providing support services, promoting economic diversification, welfare programs (e.g., basic income)

• Current Driver of Debate

  Advances in artificial intelligence (AI)

• Key Concept Popularized By

  John Maynard Keynes

• Predicted Impact by AI (2030)

  20-50 million new jobs expected, particularly in healthcare and pharmaceuticals

• Historical Economic Counter-Argument

  Classical economists argued for the net positive effects of innovation on employment.

• US Worker Concern (2023, Ernst & Young LLP)

  65% concerned about losing jobs to AI, 66% worried about falling behind at work without AI tools

• Predicted Impact by World Economic Forum (2025)

  Displacement of 75 million jobs globally, creation of 133 million new jobs globally (net gain of 58 million jobs)

• Experienced Displacement (US, 2022, Socius journal)

  14% of workers due to automation or AI

Timeline

• Discussion of machines displacing human labor since at least Aristotle's time; elite and common people generally took a pessimistic view on technological unemployment. (Source: Wikipedia)

  Pre-18th century

• Fears over the impact of machinery on jobs intensified with the growth of mass unemployment, especially in Great Britain during the Industrial Revolution. (Source: Wikipedia)

  18th century

• David Ricardo challenged the view that technology is unlikely to lead to long-term unemployment. (Source: Wikipedia)

  Early 1800s

• Classical economists formalized arguments against fears of job losses due to innovation, claiming overall innovation would not have negative effects on jobs. (Source: Wikipedia)

  Early 19th century

• Concerns over the negative impact of innovation diminished as technological progress was seen to benefit all sections of society, including the working class. (Source: Wikipedia)

  Second half of 19th century

• John Maynard Keynes popularized the phrase 'technological unemployment,' describing it as 'only a temporary phase of maladjustment'; debate about the issue spiked. (Source: Summary, Wikipedia)

  1930s

• Debate about technological unemployment spiked again. (Source: Wikipedia)

  1960s

• An enduring rise in unemployment in many industrialized nations led to renewed warnings about technological unemployment, especially in Europe. (Source: Wikipedia)

  1970s onwards

• The World Bank's World Development Report argues that while automation displaces workers, technological innovation creates more new industries and jobs on balance. (Source: Wikipedia)

  2019

• Research published in the peer-reviewed sociology journal Socius indicated that 14% of workers had already experienced job displacement due to automation or AI. (Source: Web Search)

  2022

• Ernst & Young LLP research found that 65% of US workers were concerned about losing their jobs to AI, and 66% were worried about falling behind without AI tools. (Source: Web Search)

  2023

• The World Economic Forum predicts AI will have displaced 75 million jobs globally but created 133 million new jobs, resulting in a net gain of 58 million jobs. (Source: Web Search)

  2025

• AI is expected to create and enhance 20-50 million new jobs, particularly in healthcare and pharmaceuticals. (Source: Web Search)

  2030

Technological unemployment

The term technological unemployment is used to describe the loss of jobs caused by technological change. It is a key type of structural unemployment. Technological change typically includes the introduction of labour-saving "mechanical-muscle" machines or more efficient "mechanical-mind" processes (automation), and humans' role in these processes are minimized. Just as horses were gradually made obsolete as transport by the automobile and as labourer by the tractor, humans' jobs have also been affected throughout modern history. Historical examples include artisan weavers reduced to poverty after the introduction of mechanized looms. Thousands of man-years of work was performed in a matter of hours by the bombe codebreaking machine during World War II. A contemporary example of technological unemployment is the displacement of retail cashiers by self-service tills and cashierless stores. That technological change can cause short-term job losses is widely accepted. The view that it can lead to lasting increases in unemployment has long been controversial. Participants in the technological unemployment debates can be broadly divided into optimists and pessimists. Optimists agree that innovation may be disruptive to jobs in the short term, yet hold that various compensation effects ensure there is never a long-term negative impact on jobs, whereas pessimists contend that at least in some circumstances, new technologies can lead to a lasting decline in the total number of workers in employment. The phrase "technological unemployment" was popularised by John Maynard Keynes in the 1930s, who said it was "only a temporary phase of maladjustment". The issue of machines displacing human labour has been discussed since at least Aristotle's time. Prior to the 18th century, both the elite and common people would generally take the pessimistic view on technological unemployment, at least in cases where the issue arose. Due to generally low unemployment in much of pre-modern history, the topic was rarely a prominent concern. In the 18th century fears over the impact of machinery on jobs intensified with the growth of mass unemployment, especially in Great Britain which was then at the forefront of the Industrial Revolution. Yet some economic thinkers began to argue against these fears, claiming that overall innovation would not have negative effects on jobs. These arguments were formalised in the early 19th century by the classical economists. During the second half of the 19th century, it stayed apparent that technological progress was benefiting all sections of society, including the working class. Concerns over the negative impact of innovation diminished. The term "Luddite fallacy" was coined to describe the thinking that innovation would have lasting harmful effects on employment. The view that technology is unlikely to lead to long-term unemployment has been repeatedly challenged by a minority of economists. In the early 1800s these included David Ricardo. There were dozens of economists warning about technological unemployment during brief intensifications of the debate that spiked in the 1930s and 1960s. Especially in Europe, there were further warnings in the closing two decades of the twentieth century, as commentators noted an enduring rise in unemployment suffered by many industrialised nations since the 1970s. Yet a clear majority of both professional economists and the interested general public held the optimistic view through most of the 20th century. Advances in artificial intelligence (AI) have reignited debates about the possibility of mass unemployment, or even the end of employment altogether. Some experts, such as Geoffrey Hinton, believe that the development of artificial general intelligence and advanced robotics will eventually enable the automation of all intellectual and physical tasks, suggesting the need for a basic income for non-workers to subsist. Others, like Daron Acemoglu, argue that humans will remain necessary for certain tasks, or complementary to AI, disrupting the labor market without necessarily causing mass unemployment. The World Bank's 2019 World Development Report argues that while automation displaces workers, technological innovation creates more new industries and jobs on balance.

Web Search Results

• What is Job Displacement? Definition and Explanation - AllVoices

  AllVoices logo .svg) Watch how to streamline workplace investigations .png) # Job displacement ## What is Job Displacement? The process of removing employees from their current roles due to changes in organizational needs. Job displacement can result from automation, restructuring, or downsizing. .jpg) ## Understanding Job Displacement [...] Job displacement refers to the involuntary loss of employment due to various factors such as economic downturns, technological advancements, company restructuring, or offshoring. Displaced workers often face challenges in finding new employment, especially if their skills are no longer in demand. ## Causes of Job Displacement Job displacement typically involves: ## Impact of Job Displacement Job displacement has significant impacts on individuals and the economy: [...] Understanding and addressing job displacement effectively is essential for supporting workforce transition and economic stability. By developing retraining programs, enhancing job matching, providing support services, and promoting economic diversification, organizations and policymakers can effectively manage job displacement and mitigate its negative impacts. Stay up to date on Employee Relations news Stay up to date on Employee Relations news. .svg) .svg)

• The Impact of AI on Job Roles, Workforce, and Employment

  According to a report by the World Economic Forum, by 2025, AI will have displaced 75 million jobs globally, but will have created 133 million new jobs. This means that there will be a net gain of 58 million jobs globally, but there will still be significant job displacement in certain industries. [...] Despite these potential benefits, there are also concerns about the drawbacks of implementing AI on a larger scale in the workforce. One potential concern is job displacement, which can lead to unemployment and the need for reskilling and upskilling. Another concern is the potential for bias and discrimination in algorithms, which can have negative consequences for marginalised individuals and communities. [...] is changing the job market, creating new types of jobs while automating routine tasks. With 20-50 million new jobs expected by 2030, AI is creating and enhancing jobs in healthcare, pharmaceuticals and other industries. While some industries may experience significant job displacement, the economy is expected to benefit from increased productivity and output. As AI continues to evolve, understanding its impact on employment and the economy is crucial.

• What To Do About AI-Driven Job Displacement

  As artificial intelligence continues to advance, it may lead to job displacement and lower wages for some workers. To help those affected by these changes, governments can implement various welfare programs aimed at easing the transition and supporting workers as they adapt to the new job landscape. Some potential welfare programs include: [...] The problem of job reallocation is a general one that is rooted in the fact that our national income is primarily doled out using factor payments to labor and capital. When people lose their jobs, their labor factor payments are reduced to $0 until such time as they find a new job. Finding a new job may also be difficult if the kinds of jobs a person is capable of doing are shrinking in number due to technological shifts. Once a new job is found, the factor payments that flow to it may also be [...] Every time a new technology or a new economic proposal requires a significant reallocation of labor — such as the phasing out of fossil fuels or the creation of a universal public health insurance system — we see this exact same discourse. It’s a strange discourse in that it never really changes but we also treat every instance of it as if it is a novel thing that requires a novel response.

• AI and the Workforce: Preparing for the Jobs of the Future | Thoughtful

  However, the use of AI also raises concerns about job displacement. As machines become more capable of performing tasks traditionally done by humans, some jobs may become obsolete. Workers in industries such as manufacturing, transportation, and retail are particularly vulnerable to automation. It is important for workers to develop new skills and adapt to changing job requirements to remain employable in the age of AI. [...] As AI and automation continue to advance, the future of work is an ever-evolving topic. Many experts predict that AI will lead to job displacement, while others argue that it will create new job opportunities. [...] However, there are also concerns about the impact of AI on job security and income inequality. As AI and automation become more prevalent, there is a risk that certain jobs will become obsolete, particularly those that involve routine and repetitive tasks. This could lead to job displacement and a widening gap between the highly skilled and the less skilled workers.

• How AI is Impacting the US Workforce - Camoin Associates

  According to research conducted by Ernst & Young LLP in 2023, 65% of US workers surveyed said they were concerned about losing their jobs to AI, and 66% said they were worried about falling behind at work if they didn’t know how to use AI tools. Research published in the peer-reviewed sociology journal _Socius_ in 2022 indicated that 14% of workers have already experienced job displacement due to automation or AI.