6 ms·

The rise of robots in the German labour market

171 points by hexrcs 9y ago

sarabande 9y ago
It's admirable to me that unions protect low-skilled workers from losing their job, not by preventing them from getting fired at current wages, but by accepting wage decreases for their workers while getting them re-trained into jobs of higher cognitive skill. That seems like the fair and humane thing to do for workers, while at the same time not screwing over capital owners or stifling automation.
- kensai 9y ago
  This. Germany is one of the few places that Unions are working (mostly) as intended. When Germany was under pressure in the Schröder era, it was the Unions that helped dealing with convincing the workers to accept shorter shifts and salaries, instead of pushing companies to relocation or, worse, bankruptcy.
  - maxxxxx 9y ago
    No idea why you got downvoted. Your comment is right on.
    - cnlevy 9y ago
      Maybe from a non-German union ?
  - agumonkey 9y ago
    Interesting. For those who know Germany, it's often said that even if the economic numbers are high, there's a lot of poor workers that need two jobs to live. Is it true ? true but only a small % ? normal according to you ?
    - ManuelKiessling 9y ago
      I can only report from a viewpoint inside my own filter bubble obviously, but this "two or three jobs to earn a living" is something that is still associated with the US here and practically unheard of in Germany.
      - goldbricked 9y ago
        Well, then i guess your bubble has a particularly large diameter. With almost 1 in 10 workers in Germany being part of the 'working poor' [1], there would otherwise be one in your social circle. [1] https://www.boeckler.de/106575_109897.htm https://www.boeckler.de/106575_109897.htm
        germanier 9y ago
        The definition of "working poor" they use is not "having two or more jobs" but "earning less than 60% of the median". According to IAB 2.7 million workers have a second job in Germany (which is about 1 in 12). Most of them probably because they don’t earn enough in their first.
        readittwice 9y ago
        Not to forget that this number alone doesn't mean anything, we still need to compare this number to other countries or to the past. But then we also need to consider stuff like this: AFAIR the number of "working poor" or "relative poor" decreased in/after the crisis 2008. Why? Not because companies paid more during the crisis but simply since the median income decreased.
        pgeorgi 9y ago
        "Working poor" in Germany means having to use the social security systems to make up for the difference between what they earn and what they need. And yes, this means that those jobs are tax subsidized.
      - agumonkey 9y ago
        It used to be an Americanism, but French documentaries showed the disappointments of many factory jobs; and lots of politicians there too say that the economic wonder is only so because they allowed for very harsh but unmeasured life condition.
  - jojoo 9y ago
    As a member of the German Education and Science Union i have to strongly disagree. Germany is becoming a low income country for a lot of jobs and the unions are doing nothing against it. Year after year all German workers have collective bargaining agreements close to inflation, while the economy booms. The union-reps are in bed with the companys and workers eat it up.
    - usrusr 9y ago
      Oh, unions are fighting for workers, just not very successful. They can lower the impact of market forces, but they cannot negate them. Who they are notoriously not fighting for is temp workers and future temp workers who have it much worse than barely matching inflation. Darkly logical, temps are not members.
    - karllager 9y ago
      > Germany is becoming a low income country for a lot of jobs and the unions are doing nothing against it. Yes, this is true. About 39% of the currently employed have so called atypical jobs [1] - some of which are actually subsidized by the state, because income is so low. Germany is an austerity poster child - I wonder what will happen, if the export boom is over. Things might become much worse, once the debt-financed foreign purchases dry up for some reason. [1] https://www.boeckler.de/108863_108907.htm https://www.boeckler.de/108863_108907.htm (German only).
      - lucaspiller 9y ago
        It sounds like Germany is just catching up with the rest of Europe.
    - adventured 9y ago
      Where are you seeing that the German economy is booming? It hasn't net expanded in ten years. GDP 2007: $3.44 trillion vs 2016: $3.46 trillion It has been averaging around 1.5% GDP growth since 2011. That is not booming. Germany may finally climb above the pre great recession era GDP numbers in 2017. Germany is having the problems that it is, precisely due to the lack of meaningful economic growth. There's no scenario where you're going to see almost any wage growth if GDP is mired in 0.5% to 1.5% type expansion; to make matters worse, the next recession will easily swat the recent modest gains right back down (which is one of the many reasons faster growth is a must, inevitably a recession will occur).
  - jernfrost 9y ago
    Works the same in Norway, but it is not because US/UK unions are so badly behaved. They behave as the anti-union system in the UK and US have made them act. Unions in Germany and Scandinavia work because they got considerable power and are represented on the company boards. That means they learn to take responsibilty by being given considerable responsibility and power. Unions in the US and the UK are not given any trust or power but instead are fought and sabotaged at every opportunity. This is what has made them a reactionary force dealing with management as the enemy.
  - _pmf_ 9y ago
    > it was the Unions that helped dealing with convincing the workers to accept shorter shifts and salaries Schröder paved the way for the Arbeitnehmerüberlassung, which causes a massive rise in time restricted contracts and external workforce. Unions are very happy to keep this going, as this keeps salaries for proper employees higher than ever (a 20000 EUR difference is not uncommon for the same job), and bonus payments that amount to 10000 EUR for Porsche and 6000 EUR for Daimler. For the growing number of employees working under these contracts, it amounts to having a 30 to 40 per cent lower salary to your colleague who works beside you, doing the same job. (Add to that the constant yapping of the SPD regarding a perceived gender based wage gap and you know why they are so detested in large parts of the population.)
- wiz21c 9y ago
  It is not admirable at all. It basically means that you're putting a competition between machines and humans. If machines do become smarter, then humans will be moved out of the equation (except for the 0.001% who can create and maintain the machines). This kind of fight may be good on the short term, but it legitimates the fact than man are inferior to machine. For example, it may soon legitimates that, contrary to man, the machine works non stop, doesn't go on strike, doesn't want a raise, doesn't go to the toilet, whatever... If machines are to rule, then we have to change the way we redistribute the worth they produce.
  - damnstraight 9y ago
    Maybe we should value humans beyond the labor they can fulfill.
    - thephyber 9y ago
      We already do, it's just not anywhere close to evenly distributed. Kim Kardashian and Paris Hilton did no actual work, yet made a lucrative living, even in their late teens. Almost everyone has personal family+friends that they value in ways other than needing their labor. But it doesn't scale. People have a Dunbar number of somewhere a little (perhaps a lot) over ~140, but nowhere near a nation-state population.
  - avar 9y ago
    Men are also inferior to machines when it comes to farm work, but judging from your comment you'd presumably like to go back to the good old days when over 50% of the population worked on farms.
    - richthegeek 9y ago
      Or the really good old days when 97% worked in agriculture...
      - usrusr 9y ago
        Only in times of peace. (To nitpick on myself, it could be argued that war campaigns were also mostly agricultural work: they were just harvesting other people's fields)
- Mikeb85 9y ago
  That's not a good thing. If we want society to be more equal, funnelling money to capital holders at the expense of workers isn't the way to accomplish that goal.
- matt4077 9y ago
  At the core of the comparatively good relationships between labor and capital in Germany is the law requiring labor representation of 50% - one vote on large companies' boards. This results in a complicated role for both sides that isn't just adversarial as it is in most other countries. Labor shares the responsibility for the company's future and gets to be part of every step of the process when it comes to making hard decisions. But it also requires management to strive to improve their employees' well-being, since they will often require their cooperation. If these specific solutions are anything but band-aids/wishful thinking/PR remains to be seen. Germany has, just like all other countries, seen an increased use of time-limited contracts and temp agencies, leaving many employees in perpetual danger of immediate social decline if the economy hits a road bump. And it isn't quite clear if the rise of machine learning + robotics isn't the one innovation and bucks the trend, and actually does create a class of people that is essentially shut out of the jobs market by machines that are strictly more productive at any job they can realistically perform: there's only so much programming you can teach a bricklayer in his 50s.
HillaryBriss 9y ago
they seem to be saying that high skill workers and owners are getting a net benefit from the additional robots. but, medium skill and low skill workers are seeing some negative wage impacts, but not necessarily additional unemployment. perhaps more interesting is the background info about the global focus of industrial robotics: it's in Japan (and to a much lesser extent, Germany) -- but not the US. this reinforces my current belief that robotics startups in the US face a pretty serious uphill battle from day one.
rndmize 9y ago
I'm not sure how useful it is to look at the effects of robotics in Germany in isolation. Germany exports a fair bit more than they import, and I'd expect if there are people being unemployed as a result of German use of robotics, it'd be in other parts of the EU that can no longer compete effectively.
- usrusr 9y ago
  Same for service sector automation: in California it is easy to say that technology will bring new jobs to displace the lost ones, but what is rarely seen is how every engineer at Google or Facebook is replacing whole offices of more traditional (and incredibly inefficient, compared to googbook) local ad media sales and administration all over the world. If progress brings efficiency, there will be less work. Zero sum competition can eat up those efficiency gains providing substitute jobs, but then what is the point of progress?
  - sien 9y ago
    The data says that in 2010 there were ~160K jobs in advertising in the US but in 2015 there were 200K. https://www.statista.com/statistics/498424/number-advertising-agency-employees-usa/ https://www.statista.com/statistics/498424/number-advertisin... However, it's the newspaper jobs that have gone: https://www.theguardian.com/media/greenslade/2016/jun/06/almost-60-of-us-newspaper-jobs-vanish-in-26-years https://www.theguardian.com/media/greenslade/2016/jun/06/alm... The next thing to look at would be the change in IT jobs.
    - thephyber 9y ago
      > The next thing to look at would be the change in IT jobs. We are already deep in the current cycle of disruption by software. "IT" (if you include programming, security, data centers, support staff etc) is fairly large and more diverse than advertising and/or "newspaper". I don't think it works like a waterfall / Gantt chart; it happens in parallel and we are currently seeing lots of white collar office jobs changing. (HR|Finance|Recruiting|Legal Council|Retail) are all getting optimized to the point that their ranks are thinning quickly. My first job was moving physical file-folders between a storeroom and an office -- that job is now obsolete as those files have largely been digitized.
Animats 9y ago
Note how small the ratio of robots to workers still is. 2 robots per thousand workers in the US, 8 per thousand in Germany. Those are still below 1% yet having an effect on wages. What happens at 10%? 20%? 50%? Few people thought in 1980 that there would be more computers than people in their lifetime.
- varjag 9y ago
  Most mid-1980s technology books expected majority of production jobs taken over by robots any moment soon (and the rest going to ninja-like Japanese workers). Of course what happened is the jobs went to China.
  - Top19 9y ago
    Lol I appreciate your comment about the Japanese ninja-workers. Reading business books from the 90’s, it is astounding how many people feared the Japanese and thought they would be the end all be all. Of course it ended with them going into a depression much worse than even our Great Recession. Michael Crichton, who wrote “Jurassic Park”, also wrote a book called “Rising Sun” right before that about just this topic. In that book, the velociraptors were the ninja workers you describe.
    - Animats 9y ago
      "Rising Sun" was made into a movie.[1] It has some of the early MIT Leg Lab robots in it. [1] https://en.wikipedia.org/wiki/Rising_Sun_(film) https://en.wikipedia.org/wiki/Rising_Sun_(film)
      - Top19 9y ago
        Oh man forget about these / that movie! As another aside, current really David Halberstam’s “The Next Century”, published in 1991, and his main focus in the book, after Eastern Europe, is Japan. All of this is laughable now (though some say Japan will be a superpower due to the military it’s built up to counter North Korea after NK falls), but makes you wonder, what threat do we all believe in now that will really turn out to be a paper tiger in the years ahead? EDIT: quote from the book...”the Cold War is over, the Japanese won”
neilwilson 9y ago
There's a serious category mistake in this analysis. Germany is not really a separate country. It is a state in a union called the Eurozone, and controlled by a constitution called the Treaty of the European Union. You cannot compare a currency zone such as the USA to Germany - a state in a currency zone. Germany drains demand from the rest of the Eurozone to maintain its employment level. The unemployment arises in Greece, Spain, et al instead. If you look at the near fully employed state areas in the USA and draw a line around them, then compare those with Germany you'll get a better idea. Within the US there is an 'export boom' from California and New York to the rest of the union. Similarly in the UK from London to the rest of the country. It's time for economic analysis to catch up with monetary theory. Floating rate currency zones matter.

171 points by hexrcs 9y ago

It's admirable to me that unions protect low-skilled workers from losing their job, not by preventing them from getting fired at current wages, but by accepting wage decreases for their workers while getting them re-trained into jobs of higher cognitive skill. That seems like the fair and humane thing to do for workers, while at the same time not screwing over capital owners or stifling automation.

kensai 9y ago
This. Germany is one of the few places that Unions are working (mostly) as intended. When Germany was under pressure in the Schröder era, it was the Unions that helped dealing with convincing the workers to accept shorter shifts and salaries, instead of pushing companies to relocation or, worse, bankruptcy.
- maxxxxx 9y ago
  No idea why you got downvoted. Your comment is right on.
  - cnlevy 9y ago
    Maybe from a non-German union ?
- agumonkey 9y ago
  Interesting. For those who know Germany, it's often said that even if the economic numbers are high, there's a lot of poor workers that need two jobs to live. Is it true ? true but only a small % ? normal according to you ?
  - ManuelKiessling 9y ago
    I can only report from a viewpoint inside my own filter bubble obviously, but this "two or three jobs to earn a living" is something that is still associated with the US here and practically unheard of in Germany.
    - goldbricked 9y ago
      Well, then i guess your bubble has a particularly large diameter. With almost 1 in 10 workers in Germany being part of the 'working poor' [1], there would otherwise be one in your social circle. [1] https://www.boeckler.de/106575_109897.htm https://www.boeckler.de/106575_109897.htm
      - germanier 9y ago
        The definition of "working poor" they use is not "having two or more jobs" but "earning less than 60% of the median". According to IAB 2.7 million workers have a second job in Germany (which is about 1 in 12). Most of them probably because they don’t earn enough in their first.
        readittwice 9y ago
        Not to forget that this number alone doesn't mean anything, we still need to compare this number to other countries or to the past. But then we also need to consider stuff like this: AFAIR the number of "working poor" or "relative poor" decreased in/after the crisis 2008. Why? Not because companies paid more during the crisis but simply since the median income decreased.
      - pgeorgi 9y ago
        "Working poor" in Germany means having to use the social security systems to make up for the difference between what they earn and what they need. And yes, this means that those jobs are tax subsidized.
    - agumonkey 9y ago
      It used to be an Americanism, but French documentaries showed the disappointments of many factory jobs; and lots of politicians there too say that the economic wonder is only so because they allowed for very harsh but unmeasured life condition.
- jojoo 9y ago
  As a member of the German Education and Science Union i have to strongly disagree. Germany is becoming a low income country for a lot of jobs and the unions are doing nothing against it. Year after year all German workers have collective bargaining agreements close to inflation, while the economy booms. The union-reps are in bed with the companys and workers eat it up.
  - usrusr 9y ago
    Oh, unions are fighting for workers, just not very successful. They can lower the impact of market forces, but they cannot negate them. Who they are notoriously not fighting for is temp workers and future temp workers who have it much worse than barely matching inflation. Darkly logical, temps are not members.
  - karllager 9y ago
    > Germany is becoming a low income country for a lot of jobs and the unions are doing nothing against it. Yes, this is true. About 39% of the currently employed have so called atypical jobs [1] - some of which are actually subsidized by the state, because income is so low. Germany is an austerity poster child - I wonder what will happen, if the export boom is over. Things might become much worse, once the debt-financed foreign purchases dry up for some reason. [1] https://www.boeckler.de/108863_108907.htm https://www.boeckler.de/108863_108907.htm (German only).
    - lucaspiller 9y ago
      It sounds like Germany is just catching up with the rest of Europe.
  - adventured 9y ago
    Where are you seeing that the German economy is booming? It hasn't net expanded in ten years. GDP 2007: $3.44 trillion vs 2016: $3.46 trillion It has been averaging around 1.5% GDP growth since 2011. That is not booming. Germany may finally climb above the pre great recession era GDP numbers in 2017. Germany is having the problems that it is, precisely due to the lack of meaningful economic growth. There's no scenario where you're going to see almost any wage growth if GDP is mired in 0.5% to 1.5% type expansion; to make matters worse, the next recession will easily swat the recent modest gains right back down (which is one of the many reasons faster growth is a must, inevitably a recession will occur).
- jernfrost 9y ago
  Works the same in Norway, but it is not because US/UK unions are so badly behaved. They behave as the anti-union system in the UK and US have made them act. Unions in Germany and Scandinavia work because they got considerable power and are represented on the company boards. That means they learn to take responsibilty by being given considerable responsibility and power. Unions in the US and the UK are not given any trust or power but instead are fought and sabotaged at every opportunity. This is what has made them a reactionary force dealing with management as the enemy.
- _pmf_ 9y ago
  > it was the Unions that helped dealing with convincing the workers to accept shorter shifts and salaries Schröder paved the way for the Arbeitnehmerüberlassung, which causes a massive rise in time restricted contracts and external workforce. Unions are very happy to keep this going, as this keeps salaries for proper employees higher than ever (a 20000 EUR difference is not uncommon for the same job), and bonus payments that amount to 10000 EUR for Porsche and 6000 EUR for Daimler. For the growing number of employees working under these contracts, it amounts to having a 30 to 40 per cent lower salary to your colleague who works beside you, doing the same job. (Add to that the constant yapping of the SPD regarding a perceived gender based wage gap and you know why they are so detested in large parts of the population.)
wiz21c 9y ago
It is not admirable at all. It basically means that you're putting a competition between machines and humans. If machines do become smarter, then humans will be moved out of the equation (except for the 0.001% who can create and maintain the machines). This kind of fight may be good on the short term, but it legitimates the fact than man are inferior to machine. For example, it may soon legitimates that, contrary to man, the machine works non stop, doesn't go on strike, doesn't want a raise, doesn't go to the toilet, whatever... If machines are to rule, then we have to change the way we redistribute the worth they produce.
- damnstraight 9y ago
  Maybe we should value humans beyond the labor they can fulfill.
  - thephyber 9y ago
    We already do, it's just not anywhere close to evenly distributed. Kim Kardashian and Paris Hilton did no actual work, yet made a lucrative living, even in their late teens. Almost everyone has personal family+friends that they value in ways other than needing their labor. But it doesn't scale. People have a Dunbar number of somewhere a little (perhaps a lot) over ~140, but nowhere near a nation-state population.
- avar 9y ago
  Men are also inferior to machines when it comes to farm work, but judging from your comment you'd presumably like to go back to the good old days when over 50% of the population worked on farms.
  - richthegeek 9y ago
    Or the really good old days when 97% worked in agriculture...
    - usrusr 9y ago
      Only in times of peace. (To nitpick on myself, it could be argued that war campaigns were also mostly agricultural work: they were just harvesting other people's fields)
Mikeb85 9y ago
That's not a good thing. If we want society to be more equal, funnelling money to capital holders at the expense of workers isn't the way to accomplish that goal.
matt4077 9y ago
At the core of the comparatively good relationships between labor and capital in Germany is the law requiring labor representation of 50% - one vote on large companies' boards. This results in a complicated role for both sides that isn't just adversarial as it is in most other countries. Labor shares the responsibility for the company's future and gets to be part of every step of the process when it comes to making hard decisions. But it also requires management to strive to improve their employees' well-being, since they will often require their cooperation. If these specific solutions are anything but band-aids/wishful thinking/PR remains to be seen. Germany has, just like all other countries, seen an increased use of time-limited contracts and temp agencies, leaving many employees in perpetual danger of immediate social decline if the economy hits a road bump. And it isn't quite clear if the rise of machine learning + robotics isn't the one innovation and bucks the trend, and actually does create a class of people that is essentially shut out of the jobs market by machines that are strictly more productive at any job they can realistically perform: there's only so much programming you can teach a bricklayer in his 50s.

HillaryBriss 9y ago

they seem to be saying that high skill workers and owners are getting a net benefit from the additional robots. but, medium skill and low skill workers are seeing some negative wage impacts, but not necessarily additional unemployment. perhaps more interesting is the background info about the global focus of industrial robotics: it's in Japan (and to a much lesser extent, Germany) -- but not the US. this reinforces my current belief that robotics startups in the US face a pretty serious uphill battle from day one.

rndmize 9y ago

I'm not sure how useful it is to look at the effects of robotics in Germany in isolation. Germany exports a fair bit more than they import, and I'd expect if there are people being unemployed as a result of German use of robotics, it'd be in other parts of the EU that can no longer compete effectively.

usrusr 9y ago
Same for service sector automation: in California it is easy to say that technology will bring new jobs to displace the lost ones, but what is rarely seen is how every engineer at Google or Facebook is replacing whole offices of more traditional (and incredibly inefficient, compared to googbook) local ad media sales and administration all over the world. If progress brings efficiency, there will be less work. Zero sum competition can eat up those efficiency gains providing substitute jobs, but then what is the point of progress?
- sien 9y ago
  The data says that in 2010 there were ~160K jobs in advertising in the US but in 2015 there were 200K. https://www.statista.com/statistics/498424/number-advertising-agency-employees-usa/ https://www.statista.com/statistics/498424/number-advertisin... However, it's the newspaper jobs that have gone: https://www.theguardian.com/media/greenslade/2016/jun/06/almost-60-of-us-newspaper-jobs-vanish-in-26-years https://www.theguardian.com/media/greenslade/2016/jun/06/alm... The next thing to look at would be the change in IT jobs.
  - thephyber 9y ago
    > The next thing to look at would be the change in IT jobs. We are already deep in the current cycle of disruption by software. "IT" (if you include programming, security, data centers, support staff etc) is fairly large and more diverse than advertising and/or "newspaper". I don't think it works like a waterfall / Gantt chart; it happens in parallel and we are currently seeing lots of white collar office jobs changing. (HR|Finance|Recruiting|Legal Council|Retail) are all getting optimized to the point that their ranks are thinning quickly. My first job was moving physical file-folders between a storeroom and an office -- that job is now obsolete as those files have largely been digitized.

Animats 9y ago

Note how small the ratio of robots to workers still is. 2 robots per thousand workers in the US, 8 per thousand in Germany. Those are still below 1% yet having an effect on wages. What happens at 10%? 20%? 50%? Few people thought in 1980 that there would be more computers than people in their lifetime.

varjag 9y ago
Most mid-1980s technology books expected majority of production jobs taken over by robots any moment soon (and the rest going to ninja-like Japanese workers). Of course what happened is the jobs went to China.
- Top19 9y ago
  Lol I appreciate your comment about the Japanese ninja-workers. Reading business books from the 90’s, it is astounding how many people feared the Japanese and thought they would be the end all be all. Of course it ended with them going into a depression much worse than even our Great Recession. Michael Crichton, who wrote “Jurassic Park”, also wrote a book called “Rising Sun” right before that about just this topic. In that book, the velociraptors were the ninja workers you describe.
  - Animats 9y ago
    "Rising Sun" was made into a movie.[1] It has some of the early MIT Leg Lab robots in it. [1] https://en.wikipedia.org/wiki/Rising_Sun_(film) https://en.wikipedia.org/wiki/Rising_Sun_(film)
    - Top19 9y ago
      Oh man forget about these / that movie! As another aside, current really David Halberstam’s “The Next Century”, published in 1991, and his main focus in the book, after Eastern Europe, is Japan. All of this is laughable now (though some say Japan will be a superpower due to the military it’s built up to counter North Korea after NK falls), but makes you wonder, what threat do we all believe in now that will really turn out to be a paper tiger in the years ahead? EDIT: quote from the book...”the Cold War is over, the Japanese won”

neilwilson 9y ago

There's a serious category mistake in this analysis. Germany is not really a separate country. It is a state in a union called the Eurozone, and controlled by a constitution called the Treaty of the European Union. You cannot compare a currency zone such as the USA to Germany - a state in a currency zone. Germany drains demand from the rest of the Eurozone to maintain its employment level. The unemployment arises in Greece, Spain, et al instead. If you look at the near fully employed state areas in the USA and draw a line around them, then compare those with Germany you'll get a better idea. Within the US there is an 'export boom' from California and New York to the rest of the union. Similarly in the UK from London to the rest of the country. It's time for economic analysis to catch up with monetary theory. Floating rate currency zones matter.