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The Impact of Technology on Job Loss and the Economy

Technological unemployment is the loss of employment due to technological changes and working methods. “Structural unemployment” refers to a more general idea that includes technological unemployment. With the world changing so quickly and so many technological advancements appearing, there is no doubt that technology has raised living standards and given some people job opportunities.

Nevertheless, there has frequently been concern that these technological developments will result in widespread unemployment. The prospect of technological advancement leading to increased unemployment threatens many people in particular occupations. Many businesses and companies are now using high-end technologies to increase efficiency, increasing profit.

Future improvements in information technology, robotics, and other exciting new scientific technologies promise higher production and economic development. However, although technology has simplified living and enhanced productivity and efficiency in businesses, it has started to pose issues for workers and threaten job security. Jobs have been impacted by technology both positively and negatively. This article centers on how technology has harmed jobs.

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Instances of technical unemployment

ATM replaces Bank Jobs

For instance, automated teller machines, or ATMs, have replaced some bank positions. Before the invention of ATMs, which eliminated the need for certain people to handle the disbursement of money to customers, the work was supervised by specific people.

Rise of AI

Many professions are under threat as a result of new technologies such as automation and artificial intelligence.
Machines and automation are increasingly replacing low-skilled employees. Because of technology’s effectiveness and high productivity, many businesses have decided to substitute human labor.

However, due to the intense rivalry from other technology-using companies, they risk losing out if they do not equally replace human labor with technology.

Technological advancements

These technological advancements have a particularly negative impact on low-skilled workers. Jobs like switchboard operators, mail sorters, etc., have dramatically declined or even disappeared due to the development of technologies that supplanted human labor.

For instance, eateries would stop needing to hire a human dishwasher if they invested in commercial dish-washing equipment. Today, fewer people than a century ago labor in automobile factories. Most auto factories now regularly use machines to remove, fix, and paint body components, reducing the need for human labor.

A restaurant in China employs robots to provide customers with a completely automated dining and cooking experience. Robotic arms at restaurants make fast food after being programmed to follow instructions for making stir-fries and noodles. Many economists believe that technology increases productivity and generates prosperity for society. However, the impact of technology on clerical and professional jobs has been less pronounced.

A company can eliminate workers and produce the same quantity of goods when labor-saving machines are added to the production process. Consequently, some employees may lose their jobs.

Read Also: Why technology is making us less social?

Why Technology development may result in higher unemployment

Since 2000, employment growth and product development are no longer linked. Early in the new millennium, employment increased more slowly than output.

Since the Great Depression ended, job growth has accelerated. (though in a flexible labor market – many new jobs are low-paid). But this might indicate that automation’s productivity gains result in slower employment growth. (though there could be other factors too)

Technological change will only lead to unemployment if labor marketplaces are flexible. However, if there are rigidities in the job market, this could result in unemployment—at least temporarily.

For instance, employment losses among coal miners may result from technological advancement. However, they might need to find a way to accept new positions in the service industry due to geographic and occupational immobility. (e.g., a miner may need to gain skills to work in computers; he may find it hard to relocate).

In this situation, technical advancement may lead to a brief rise in unemployment, which will last until coal miners acquire better skills and mobility. Corporate profits saw a significant increase in this time frame starting in 2000, indicating that businesses are making more money thanks to greater productivity. This demonstrates that since 1990, the contribution of labor (salaries and earnings) to GDP has decreased. This does not consider the widening wage gap and pays for the highest 1%.

Why does unemployment not arise from technical change?

The development of computers and robots allowed businesses to create manufactured goods with fewer employees. Let’s assume that technological advancements will allow us to create food with fewer laborers. Therefore, food production is more affordable, meaning food prices should decrease.

As a result, individuals can spend a smaller portion of their income on food. In addition, people can now afford to buy other products and services because they have more money. In addition, since the relative cost of manufactured goods decreased due to higher productivity, more people could find employment in the service industry.

Hence, technology is beneficial to the economy in that:

  • There will be a higher worker demand due to the greater need for manufactured goods.
  • Technology innovation modifies the kinds of jobs that exist in the economy. As a result, we can access a wider variety of goods and services if labor productivity rises.

In the UK, there were 1.2 million producers of coal in 1However, the. The number of employed people decreased to less than 5,000 in 2012 due to technological development.

Conclusion

Although technology has made a living more accessible, those who have experienced significant job loss are the ones who have suffered the most.

They will now be compelled to acquire additional high-paying skills to stay relevant. Therefore, it makes sense for anyone who feels threatened by these quick technological advancements, particularly low-skilled workers, to ensure they don’t wait until they are ultimately laid off from their employment before learning new skills.

With more technological advancements, more people will lose employment, except those who have decided to go with the flow. Technology is here to stay. In addition, due to technological advancements, people must continue to update their knowledge to stay relevant in the employment market.

For some people, juggling jobs and personal obligations can be completely overwhelming. Reports claim that technology has displaced 90 percent of human labor, including factory employees, customer service representatives, and those filling out paperwork.

Robin Okwanma
Robin Okwanmahttps://justrobin.dev
Hi, I'm Robin Okwanma. Software Engineer || Django, Python || React, React Native || Blogger. Technical Writer.
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