The Automation, particularly when it comes to robots (artificial intelligence – AI) and software (take self-driving trucks, and industries from auto manufacturing, to metal products, pharmaceuticals, food service, and warehouses) is swallowing up brick-and-mortar retail jobs and rendering the middle-class powerless.
Yet, a report by the Progressive Policy Institute on “How Ecommerce Creates Jobs and Reduces Income Inequality,” the corresponding rise of e-commerce is creating different kinds of jobs such as fulfillment-center jobs (where incoming orders are received from affiliated stores or locations and these orders are processed and filled) that otherwise wouldn’t even have existed.
The MIT Technology Review reports that 140,000 U.S. conventional jobs have disappeared since 2007. Meanwhile, the Bureau of Labor Statistics states, says that during that period, e-commerce has created only 126,000 jobs.
Michael Mandel, Chief Economic Strategist of the Progressive Policy Institute who compiled the report, estimates that careers in ecommerce businesses and fulfillment centers increased by 400,000 between December 2007 and June 2017, significantly surpassing the 140,000 drop of traditional retail jobs. He explains the job rise by revealing that ecommerce has led families to save 64 million hours a week on time spent shopping. Moreover, a percentage of these free hours are being moved into market work.
A result worth mentioning is that efficiency progress is being undervalued. By analyzing different countries, it is estimated that jobs at fulfillment centers pay 31 percent more than traditional retail jobs in the equivalent arena. This implies that the move to ecommerce jobs is dipping revenue disparity by increasing high school graduates’ salaries.
The Wall Street Journal retorts that “for retailers, the robot apocalypse isn’t a sci-fi movie. As digital giants swallow a growing share of shoppers’ spending, thousands of stores have closed and tens of thousands of workers have lost their jobs.” If e-commerce corporations have made their workers more productive through the use of automation, why have they also raised the total number of retail jobs and even managed to improve wages?
The article continues that e-commerce doesn’t merely flog the identical just cheaper product as a shop, but allows customers to inspect a wide array of goods and pick exactly the ones they wish to buy and have it supplied within a short timeframe, saving them money, time, and the aggravation of visiting numerous shops. E-commerce has people using more retail facilities with better quality than in the pre-online period.
Bottom line, unlike the Industrial Revolution, AI poses a far greater threat in taking over human labor than machines once did. Having said that, the effects might still be positive — after all, AI could dramatically improve the economy and aspects of everyday life, but the government and political circles need to invent ways to make sure everyone benefits — if the rapid emergence of new digital technologies and AI are left up to chance, labor disparities might worsen.
Even if the end-of-work scenario may just be a speculation, it’s time to adopt educational and labor policies to address the plight of workers either displaced by technology or ill-suited for the new opportunities!