5 ms·

It's certainly true that the job market is going crazy in silicon valley, but the complaints in this article go against some pretty fundamental economic princip

It's certainly true that the job market is going crazy in silicon valley, but the complaints in this article go against some pretty fundamental economic principles - namely that more efficient use of capital results in unemployment. Disruptive technology often results in unemployment in the short term because it cleans up inefficiencies -- look at the industrial revolution. I think it's fair to say we're richer as a society because we can automate production of goods. Yes, it put a lot of craftsmen out of work, but it was a hugely beneficial change. And so these days we have itunes putting record stores out of business. And amazon shutting down book stores. There's plenty of nostalgia for these establishments, but the things that have replaced them electronically give us incredibly better selection at less of a cost.

DasIch 15y ago
The assumption that unemployment caused by innovation is only short term is based on the assumption that new jobs will be created which require (roughly) the same qualifications. I think that more and more this proves to be a questionable expectation.
- ivankirigin 15y ago
  If you don't operate under the assumption that people will work to improve their skills and learn so as to become functional and contributing members of society, you're committing to a static society or complete dependence on the government. People need to start acting like a job isn't a right but something you earn. If you think the current disruption is meaningful, just wait 10 to 20 years for robots to replace almost all service jobs in a very short time
  - gnaritas 15y ago
    > you're committing to a static society You say that as if it's a given bad thing, it isn't; humans lived in virtually static societies for most of their existence; the current rate of change is simply too fast for most people and is itself not the norm. It's like we're trying to become the Morlocks and the Eloi.
    - ivankirigin 15y ago
      Let me know your opinion on static societies when you or someone you love gets diagnosed with a currently terminal disease. Or, on a grander scale, a static human race is doomed to extinction by the next large asteroid.
  - orky56 15y ago
    "a job isn't a right but something you earn" I definitely agree but when you are at a company who has employed you for a long time and have been doing your job well, then who's not to say that now unemployed person hasn't earned that job. The time spent at that job performing well could have been spent learning some new in-demand skill but think of the opportunity cost. Now when these people are unemployed, do we really think society has provided the motivation, resources, and most importantly, direction, to change their view on career and development. It's a very big step and I believe its naive to think that unemployment is an event actionable enough to make someone switch their mentality.
    - ivankirigin 15y ago
      I don't really put blame on individuals. I think they are socialized to make their poor decisions. I mainly blame our educational institutions and government for telling people for decades that they will be taken care of when down. It's a lie, but comes with a bonus of placating people.
  - rbarooah 15y ago
    I think this is pretty accurate, however there is a potential structural problem: entry level, or low level jobs in general don't pay people enough to invest time or resources in improving their skills - certainly not for longer term shifts in the economy. "Earning" a job, implies that people invest their own resources in preparing themselves for the future. I am vehemently in favor of that as a general way for society to operate. However, this vision requires that people have sufficient resources to make these investments. Given the increasing disparities of resource allocation that we're seeing, why should we assume that this is possible?
    - ivankirigin 15y ago
      In all of human history, it has never been easier than today to learn something new.
- irrelative 15y ago
  Sure, that economic theory doesn't take into account jobs with the same qualifications. But why should it? When assembly line production began being automated by robotics, I'm sure there were stories about how the riveters and welders would never be able to work again. We're still better off because of that automation though - goods can be produced more efficiently and at higher quality. We can't predict the future, but every previous disruptive technological innovation has resulted in society being richer. It would be quite the shock if the result of the most recent one somehow left us poorer -- something really worth reporting on -- but I don't believe it.
  - RuadhanMc 15y ago
    Society as a whole gets richer, but within those confines the rich can get richer and the poor can get poorer. Granted the poor today (I assume) have a higher quality of life than they did 50 years ago, but their expectations for life are also (probably) higher and cheap credit means that they can live beyond their means and a deeper whole for themselves, while temporarily giving themselves the impression that they have money to spend. Silicon Valley is producing these great billion dollar companies, but the companies themselves are only hiring a small fraction of the employees that similarly sized (market cap) companies have in the past. That is a bit of a problem. It means that incredible wealth is concentrated in one place, but without the filter down value that has occurred in the past. These companies still have immense value to society, but the value as far as numbers of people employed is decreasing dramatically and that is a major concern.
    - anamax 15y ago
      > Society as a whole gets richer, but within those confines the rich can get richer and the poor can get poorer. But, do they get poorer? > Granted the poor today (I assume) have a higher quality of life than they did 50 years ago, Good - they're getting richer. But, why does the sentence continue. > but their expectations for life are also (probably) higher and cheap credit means that they can live beyond their means and a deeper whole for themselves, while temporarily giving themselves the impression that they have money to spend. Huh? The fact that US poor can be better off than ever before has no connection to easy credit. In fact, even with the easy credit and the resulting bankruptcy, they're better off now than past poor. Note that I'm not arguing for stupid credit policies (pushed mostly by govt). I'm pointing out that they have nothing to do with whether the poor are better off now. Oh, and most poor people didn't get into the cheap credit problem because they didn't even qualify under the stupid standards. However, the efforts to prop up folks who bought what they can't afford have kept folks who saved out of those houses. It's unclear why that's a good thing. For the good of society, banks need to lose money on stupid loans.
vannevar 15y ago
We're nearing a point where we might question whether efficiency as a goal in itself has ceased to be beneficial to us. After all, we begin as dust and end as dust; why not make things more efficient by eliminating all the messy life part in between? Maybe we should be less concerned about efficiency and more concerned about our quality of life. And not just we the wealthy (and everyone reading HN is much, much wealthier than the average human being), but everyone. Because if there is one thing history demonstrates, it's that when wealth becomes overly concentrated, grief is sure to follow for everyone.
- deleted 15y ago
  [deleted]
- dantheman 15y ago
  By improving efficiency we are improving the quality of life of those around the world. Due to rapid improvements in technology those in the poorest countries can now easily access information, entertainment, books, knowledge from anywhere in the world at remarkably low cost -> Greatly improving their quality of life (if we agree that life like we have in the west is the goal).
  - dreamdu5t 15y ago
    What's the point of completely automating everything if you still have to work 40 hours a week?
    - nostrademons 15y ago
      Why do you still have to work 40 hours a week once everything is automated?
      - robryan 15y ago
        The problem there though is that those working have little interest in paying say 50% tax to support those who they have put out if work with increased efficiency.
paganel 15y ago
> There's plenty of nostalgia for these establishments, but the things that have replaced them electronically give us incredibly better selection at less of a cost. The question is: who will buy all these things (doesn't matter if it's online or offline) if more and more people don't have a steady paycheck?
- phlux 15y ago
  This is a really interesting question; Just who will buy these things. Last night as i was struggling to fall asleep I was daydreaming about "What will the internet and tech look like in 50 years" - I was thinking that in 50 years, the internet, and thus the world, will look a lot more like the dystopian future portrayed in CyberPunk from the 80's; i.e. the massive scale of global corporations and their influence over all aspects of our lives. The people who will buy "these things" (That which is made in silicon valley, online digital product) shall be further gobbled up by both facebook and google - as the extending of their reach into our lives continues. Their services will continue to be free to the users - the most useful of online services will be bought by them and made free to their users for the purpose of extracting use data from the populous in ever more accurate detail. This data will be used to track, sell to and control the worlds population. Spending habits. Social habits. Search habits. Communication habits. etc... All watched, monitored, monetized and cataloged. There is going to be an ever increasing class gap. The smartest of people will be bought into the system. Working on furthering its vision and capability. The disenfranchised lower classes will grow, become more violent and be used as the reasoning for greater governmental control over the new economically unbalanced and violent world.

DasIch 15y ago

The assumption that unemployment caused by innovation is only short term is based on the assumption that new jobs will be created which require (roughly) the same qualifications. I think that more and more this proves to be a questionable expectation.

ivankirigin 15y ago
If you don't operate under the assumption that people will work to improve their skills and learn so as to become functional and contributing members of society, you're committing to a static society or complete dependence on the government. People need to start acting like a job isn't a right but something you earn. If you think the current disruption is meaningful, just wait 10 to 20 years for robots to replace almost all service jobs in a very short time
- gnaritas 15y ago
  > you're committing to a static society You say that as if it's a given bad thing, it isn't; humans lived in virtually static societies for most of their existence; the current rate of change is simply too fast for most people and is itself not the norm. It's like we're trying to become the Morlocks and the Eloi.
  - ivankirigin 15y ago
    Let me know your opinion on static societies when you or someone you love gets diagnosed with a currently terminal disease. Or, on a grander scale, a static human race is doomed to extinction by the next large asteroid.
- orky56 15y ago
  "a job isn't a right but something you earn" I definitely agree but when you are at a company who has employed you for a long time and have been doing your job well, then who's not to say that now unemployed person hasn't earned that job. The time spent at that job performing well could have been spent learning some new in-demand skill but think of the opportunity cost. Now when these people are unemployed, do we really think society has provided the motivation, resources, and most importantly, direction, to change their view on career and development. It's a very big step and I believe its naive to think that unemployment is an event actionable enough to make someone switch their mentality.
  - ivankirigin 15y ago
    I don't really put blame on individuals. I think they are socialized to make their poor decisions. I mainly blame our educational institutions and government for telling people for decades that they will be taken care of when down. It's a lie, but comes with a bonus of placating people.
- rbarooah 15y ago
  I think this is pretty accurate, however there is a potential structural problem: entry level, or low level jobs in general don't pay people enough to invest time or resources in improving their skills - certainly not for longer term shifts in the economy. "Earning" a job, implies that people invest their own resources in preparing themselves for the future. I am vehemently in favor of that as a general way for society to operate. However, this vision requires that people have sufficient resources to make these investments. Given the increasing disparities of resource allocation that we're seeing, why should we assume that this is possible?
  - ivankirigin 15y ago
    In all of human history, it has never been easier than today to learn something new.
irrelative 15y ago
Sure, that economic theory doesn't take into account jobs with the same qualifications. But why should it? When assembly line production began being automated by robotics, I'm sure there were stories about how the riveters and welders would never be able to work again. We're still better off because of that automation though - goods can be produced more efficiently and at higher quality. We can't predict the future, but every previous disruptive technological innovation has resulted in society being richer. It would be quite the shock if the result of the most recent one somehow left us poorer -- something really worth reporting on -- but I don't believe it.
- RuadhanMc 15y ago
  Society as a whole gets richer, but within those confines the rich can get richer and the poor can get poorer. Granted the poor today (I assume) have a higher quality of life than they did 50 years ago, but their expectations for life are also (probably) higher and cheap credit means that they can live beyond their means and a deeper whole for themselves, while temporarily giving themselves the impression that they have money to spend. Silicon Valley is producing these great billion dollar companies, but the companies themselves are only hiring a small fraction of the employees that similarly sized (market cap) companies have in the past. That is a bit of a problem. It means that incredible wealth is concentrated in one place, but without the filter down value that has occurred in the past. These companies still have immense value to society, but the value as far as numbers of people employed is decreasing dramatically and that is a major concern.
  - anamax 15y ago
    > Society as a whole gets richer, but within those confines the rich can get richer and the poor can get poorer. But, do they get poorer? > Granted the poor today (I assume) have a higher quality of life than they did 50 years ago, Good - they're getting richer. But, why does the sentence continue. > but their expectations for life are also (probably) higher and cheap credit means that they can live beyond their means and a deeper whole for themselves, while temporarily giving themselves the impression that they have money to spend. Huh? The fact that US poor can be better off than ever before has no connection to easy credit. In fact, even with the easy credit and the resulting bankruptcy, they're better off now than past poor. Note that I'm not arguing for stupid credit policies (pushed mostly by govt). I'm pointing out that they have nothing to do with whether the poor are better off now. Oh, and most poor people didn't get into the cheap credit problem because they didn't even qualify under the stupid standards. However, the efforts to prop up folks who bought what they can't afford have kept folks who saved out of those houses. It's unclear why that's a good thing. For the good of society, banks need to lose money on stupid loans.

vannevar 15y ago

We're nearing a point where we might question whether efficiency as a goal in itself has ceased to be beneficial to us. After all, we begin as dust and end as dust; why not make things more efficient by eliminating all the messy life part in between? Maybe we should be less concerned about efficiency and more concerned about our quality of life. And not just we the wealthy (and everyone reading HN is much, much wealthier than the average human being), but everyone. Because if there is one thing history demonstrates, it's that when wealth becomes overly concentrated, grief is sure to follow for everyone.

deleted 15y ago
[deleted]
dantheman 15y ago
By improving efficiency we are improving the quality of life of those around the world. Due to rapid improvements in technology those in the poorest countries can now easily access information, entertainment, books, knowledge from anywhere in the world at remarkably low cost -> Greatly improving their quality of life (if we agree that life like we have in the west is the goal).
- dreamdu5t 15y ago
  What's the point of completely automating everything if you still have to work 40 hours a week?
  - nostrademons 15y ago
    Why do you still have to work 40 hours a week once everything is automated?
    - robryan 15y ago
      The problem there though is that those working have little interest in paying say 50% tax to support those who they have put out if work with increased efficiency.

paganel 15y ago

> There's plenty of nostalgia for these establishments, but the things that have replaced them electronically give us incredibly better selection at less of a cost. The question is: who will buy all these things (doesn't matter if it's online or offline) if more and more people don't have a steady paycheck?

phlux 15y ago
This is a really interesting question; Just who will buy these things. Last night as i was struggling to fall asleep I was daydreaming about "What will the internet and tech look like in 50 years" - I was thinking that in 50 years, the internet, and thus the world, will look a lot more like the dystopian future portrayed in CyberPunk from the 80's; i.e. the massive scale of global corporations and their influence over all aspects of our lives. The people who will buy "these things" (That which is made in silicon valley, online digital product) shall be further gobbled up by both facebook and google - as the extending of their reach into our lives continues. Their services will continue to be free to the users - the most useful of online services will be bought by them and made free to their users for the purpose of extracting use data from the populous in ever more accurate detail. This data will be used to track, sell to and control the worlds population. Spending habits. Social habits. Search habits. Communication habits. etc... All watched, monitored, monetized and cataloged. There is going to be an ever increasing class gap. The smartest of people will be bought into the system. Working on furthering its vision and capability. The disenfranchised lower classes will grow, become more violent and be used as the reasoning for greater governmental control over the new economically unbalanced and violent world.