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I don't get the reasoning. If people are more effective at doing their jobs with a tool, their productivity would increase meaning their wages would also increa

by bko 4y ago

I don't get the reasoning. If people are more effective at doing their jobs with a tool, their productivity would increase meaning their wages would also increase. Does anyone think people in finance would be paid more if we got rid of excel? And if productivity increases that means it's worth to hire more people. Look at bank tellers after the advent of the ATM. There are more bank tellers today than before the ATM. > The number of human bank tellers in the United States increased from approximately 300,000 in 1970 to approximately 600,000 in 2010. Counter-intuitively, a contributing factor may be the introduction of automated teller machines. ATMs let a branch operate with fewer tellers, making it cheaper for banks to open more branches. This likely resulted in more tellers being hired to handle non-automated tasks, but further automation and online banking may reverse this increase. Doom from technology is always around the corner but we just never happen to get there. https://en.m.wikipedia.org/wiki/Automated_teller_machine https://en.m.wikipedia.org/wiki/Automated_teller_machine

ulrashida 4y ago
Later figures showed that this increase was short lived. Vox describes the initial flaws in Schmidt's reasoning here: https://www.vox.com/2017/5/8/15584268/eric-schmidt-alphabet-automation-atm-bank-teller https://www.vox.com/2017/5/8/15584268/eric-schmidt-alphabet-... (this is also the source behind that Wikipedia article) Statistics from the US Beauteau of Labor Statistics (https://www.bls.gov/ooh/office-and-administrative-support/tellers.htm#tab-6 https://www.bls.gov/ooh/office-and-administrative-support/te...) proves Vox's assessment was correct: there are now only 378,000 tellers in 2021 and is forecasted to continue to decrease. For context, the US population grew 68% over the same period suggesting that as a proportion of available jobs the difference is even more stark.
- Buttons840 4y ago
  This is a good discussion. If, like tellers, the initial effect of AI is to increase the demand for developers and then taper off, this could be ideal. The initial surge in demand will give many a chance to increase their knowledge of AI techniques and in about a decade when AI is everywhere, demand for all knowledge work will start to drop. The good thing about this is knowledge and experience about AI has spread, it is for all to use (hopefully it works reasonably well on a desktop computer). Then the real shakeup begins, but at least the means of production -- or rather, the means of AI -- has spread and isn't completely siloed in one or two companies.
- bko 4y ago
  You have some variation over time but you would need to look at the drastic rise in ATMs from 1970-1990. If the theory that ATMs impacted employment negatively is true, that's where you should see the drop in jobs. Or broaden it out and ask what happened to job opportunities in banks or finance in general. There has been huge growth in productivity and hence headcount growth. Same is true for engineers. With modern dev tools and eng is a lot more productive and hence more profitable. And the ATM was invented 50 years ago, so even if bank tellers are on the decline today i wouldn't call that short lived https://www.aei.org/economics/what-atms-bank-tellers-rise-robots-and-jobs/ https://www.aei.org/economics/what-atms-bank-tellers-rise-ro...
  - ulrashida 4y ago
    If the hypothesis is revised to "increasing automation does not automatically reduce employment in the short term" that is feasible from the 1970-1990 dataset as you've noted. I suggest that the ATM comparison is inadequate for this proof. Looking at a nominally favorable article from AEI (https://www.aei.org/economics/what-atms-bank-tellers-rise-robots-and-jobs/ https://www.aei.org/economics/what-atms-bank-tellers-rise-ro...) we see the case of "teller employment is going up AND ATMs are going up, ergo ATM adoption does not steal teller jobs". Except we don't know that, all we know is that both are going up. There is no way of knowing what the teller growth rate would have been absent ATM technology. Looking at the graphs shown, it is fairly clear that tellers were increasing from 1970-1980 at a strong rate and then it more or less levelled off. ATMs grew at a very similar rate from 1990-2000. It seems reasonable that if ATMs were not as successful as they were, the teller growth would have been higher and therefore ATMs have "stolen" at least some teller jobs growth potential. Absent a technological efficiency increase, the base demand of US population growth would have created more need for human provided services. In the long term the truth is laid bare: in the AEI article (2016) it says "employment of tellers is projected to decline 8% over the next decade". That would have left us with ~543k tellers -- instead we have 378k, a drop of 35%. When the tailwind stops, we will often see capital choose technology over humans and often at higher rates than projected. A parting concern: the rate of technological change and capability of industries to swap inputs was impressive in 1970-2000 but I hope you will agree it is nothing compared to the pace of change now. There is every reason to believe the trends, short and long term, we saw with ATM:tellers is going to repeat faster in the future.
haswell 4y ago
> If people are more effective at doing their jobs with a tool, their productivity would increase meaning their wages would also increase. Does anyone think people in finance would be paid more if we got rid of excel? Excel made it possible to eliminate the manual parts of certain tasks that humans are bad at, and generally uninterested in doing. AGI removes the need for a human entirely. These considerations are not similar in substance or scope, and applying old models of understanding technology advancement is a dangerous game when exploring the potential realities of AGI. It’d be better to frame AGI conversations as if we had just discovered an alien species but had not yet made first contact. Assuming our understanding of biology on earth is sufficient to predict the outcomes of first contact would be similarly dangerous.
- bko 4y ago
  We alreat have AGI. Well not really but you can hire people. Do employees remove the need for management? Do you think you'll be able to prompt AGI "do business things" and it'll just carry on in it's virtual world that will somehow translate to real value?
  - beernet 4y ago
    Per definition, AGI is not equivalent to human intelligence. Then again, intelligence itself is not well-defined either.
  - haswell 4y ago
    The A in AGI stands for Artificial, and the result is by definition not human. Thinking about this problem in terms of human dynamics is a non-starter, and employee/manager relationships as we understand them are irrelevant or misleading at best. > Do you think you'll be able to prompt AGI "do business things" and it'll just carry on in its virtual world that will somehow translate to real value? Simply: yes. And much more. This is the general concern about AGI in a nutshell. If an alien ship shows up tomorrow, and its occupants express a desire to coexist/cooperate, and it becomes clear that they are significantly smarter than we are, what concerns come to mind? What if suddenly every company in existence is angling to benefit from this higher intelligence, and wants to proceed with full inter-species integration/collaboration full speed ahead, without fully understanding the goals of this other species? What if we later learned that this species prefers extremely hot climates and thrives on high CO2/low oxygen environments? Would we be so willing to participate in a short term business optimization initiative? What if we also learned that this species is remarkably similar to humans in that it will compete for various forms and degrees of power while ignoring the long term ramifications? Given what we know about our own species, the prospect that a super-intelligence might be built by and based on it should be terrifying.
arisAlexis 4y ago
Nuclear doom can happen anytime. So can AI,bioweapons etc.
JohnFen 4y ago
> If people are more effective at doing their jobs with a tool, their productivity would increase meaning their wages would also increase. Why do you assume this would be the case? Why would companies increase pay? > And if productivity increases that means it's worth to hire more people. No, it means the opposite. Companies can reduce payroll expenses without incurring a decrease in productivity. it's not clear to me that your bank branch example shows that automation increased employment. It seems more likely that as populations have grown, there was a corresponding increase in demand for bank branches. But that's just speculation either way. Do we have a good way of determining causality here?
- bko 4y ago
  > Why do you assume this would be the case? Why would companies increase pay? It's pretty basic economics that says wages are based on productivity. If you were hiring would you pay more for a 10x engineer? If the current employer wouldn't pay you more you could leave as someone else would pay you since you're more productive Its self evident pretty basic economics. Disputing that you'd have to reinvent a lot of basic economics Dev tools made programmers many times more productive. Do employees just stop hiring as many programmers?
  - mullingitover 4y ago
    > It's pretty basic economics that says wages are based on productivity. This is a nice idea that plays to the human sense of fairness, but wages have been completely decoupled from productivity for about the last four decades[1]. The only thing that really raises wages is the market power of laborers. Wages have stagnated or fallen as the market power of labor has eroded. [1] https://hbr.org/2015/06/the-great-decoupling https://hbr.org/2015/06/the-great-decoupling
    - bko 4y ago
      You're looking at aggregate values. And there's a lot going on including benefits. It's hard to tease out. But use common sense. It's not about fairness. If you had a goose that lays golden eggs that you can sell for $100 net of costs. You'd pay up to $100 for the goose. If suddenly it started producing double the eggs you'd pay up to $200 or someone else would outbid you. The only way the goose wouldn't be able to get a higher salary is if competitors were not greedy as it's basically free money and just let the current owner profit from the goose's productivity gain
mrguyorama 4y ago
FYI, US population in 1970 was only 200 million
tinglymintyfrsh 4y ago
Well, you need many fewer people to do the same amount of work. In America in particular, there isn't enough income or jobs in the low/no skill area to survive. Suicide and deaths of despair rates amongst middle-aged and older in this demographic are astronomical. In the relatively near future, it won't be necessary to have as many software engineers to run a very large company.

by bko 4y ago

ulrashida 4y ago

Later figures showed that this increase was short lived. Vox describes the initial flaws in Schmidt's reasoning here: https://www.vox.com/2017/5/8/15584268/eric-schmidt-alphabet-automation-atm-bank-teller https://www.vox.com/2017/5/8/15584268/eric-schmidt-alphabet-... (this is also the source behind that Wikipedia article) Statistics from the US Beauteau of Labor Statistics (https://www.bls.gov/ooh/office-and-administrative-support/tellers.htm#tab-6 https://www.bls.gov/ooh/office-and-administrative-support/te...) proves Vox's assessment was correct: there are now only 378,000 tellers in 2021 and is forecasted to continue to decrease. For context, the US population grew 68% over the same period suggesting that as a proportion of available jobs the difference is even more stark.

Buttons840 4y ago
This is a good discussion. If, like tellers, the initial effect of AI is to increase the demand for developers and then taper off, this could be ideal. The initial surge in demand will give many a chance to increase their knowledge of AI techniques and in about a decade when AI is everywhere, demand for all knowledge work will start to drop. The good thing about this is knowledge and experience about AI has spread, it is for all to use (hopefully it works reasonably well on a desktop computer). Then the real shakeup begins, but at least the means of production -- or rather, the means of AI -- has spread and isn't completely siloed in one or two companies.
bko 4y ago
You have some variation over time but you would need to look at the drastic rise in ATMs from 1970-1990. If the theory that ATMs impacted employment negatively is true, that's where you should see the drop in jobs. Or broaden it out and ask what happened to job opportunities in banks or finance in general. There has been huge growth in productivity and hence headcount growth. Same is true for engineers. With modern dev tools and eng is a lot more productive and hence more profitable. And the ATM was invented 50 years ago, so even if bank tellers are on the decline today i wouldn't call that short lived https://www.aei.org/economics/what-atms-bank-tellers-rise-robots-and-jobs/ https://www.aei.org/economics/what-atms-bank-tellers-rise-ro...
- ulrashida 4y ago
  If the hypothesis is revised to "increasing automation does not automatically reduce employment in the short term" that is feasible from the 1970-1990 dataset as you've noted. I suggest that the ATM comparison is inadequate for this proof. Looking at a nominally favorable article from AEI (https://www.aei.org/economics/what-atms-bank-tellers-rise-robots-and-jobs/ https://www.aei.org/economics/what-atms-bank-tellers-rise-ro...) we see the case of "teller employment is going up AND ATMs are going up, ergo ATM adoption does not steal teller jobs". Except we don't know that, all we know is that both are going up. There is no way of knowing what the teller growth rate would have been absent ATM technology. Looking at the graphs shown, it is fairly clear that tellers were increasing from 1970-1980 at a strong rate and then it more or less levelled off. ATMs grew at a very similar rate from 1990-2000. It seems reasonable that if ATMs were not as successful as they were, the teller growth would have been higher and therefore ATMs have "stolen" at least some teller jobs growth potential. Absent a technological efficiency increase, the base demand of US population growth would have created more need for human provided services. In the long term the truth is laid bare: in the AEI article (2016) it says "employment of tellers is projected to decline 8% over the next decade". That would have left us with ~543k tellers -- instead we have 378k, a drop of 35%. When the tailwind stops, we will often see capital choose technology over humans and often at higher rates than projected. A parting concern: the rate of technological change and capability of industries to swap inputs was impressive in 1970-2000 but I hope you will agree it is nothing compared to the pace of change now. There is every reason to believe the trends, short and long term, we saw with ATM:tellers is going to repeat faster in the future.

haswell 4y ago

> If people are more effective at doing their jobs with a tool, their productivity would increase meaning their wages would also increase. Does anyone think people in finance would be paid more if we got rid of excel? Excel made it possible to eliminate the manual parts of certain tasks that humans are bad at, and generally uninterested in doing. AGI removes the need for a human entirely. These considerations are not similar in substance or scope, and applying old models of understanding technology advancement is a dangerous game when exploring the potential realities of AGI. It’d be better to frame AGI conversations as if we had just discovered an alien species but had not yet made first contact. Assuming our understanding of biology on earth is sufficient to predict the outcomes of first contact would be similarly dangerous.

bko 4y ago
We alreat have AGI. Well not really but you can hire people. Do employees remove the need for management? Do you think you'll be able to prompt AGI "do business things" and it'll just carry on in it's virtual world that will somehow translate to real value?
- beernet 4y ago
  Per definition, AGI is not equivalent to human intelligence. Then again, intelligence itself is not well-defined either.
- haswell 4y ago
  The A in AGI stands for Artificial, and the result is by definition not human. Thinking about this problem in terms of human dynamics is a non-starter, and employee/manager relationships as we understand them are irrelevant or misleading at best. > Do you think you'll be able to prompt AGI "do business things" and it'll just carry on in its virtual world that will somehow translate to real value? Simply: yes. And much more. This is the general concern about AGI in a nutshell. If an alien ship shows up tomorrow, and its occupants express a desire to coexist/cooperate, and it becomes clear that they are significantly smarter than we are, what concerns come to mind? What if suddenly every company in existence is angling to benefit from this higher intelligence, and wants to proceed with full inter-species integration/collaboration full speed ahead, without fully understanding the goals of this other species? What if we later learned that this species prefers extremely hot climates and thrives on high CO2/low oxygen environments? Would we be so willing to participate in a short term business optimization initiative? What if we also learned that this species is remarkably similar to humans in that it will compete for various forms and degrees of power while ignoring the long term ramifications? Given what we know about our own species, the prospect that a super-intelligence might be built by and based on it should be terrifying.

arisAlexis 4y ago

Nuclear doom can happen anytime. So can AI,bioweapons etc.

JohnFen 4y ago

> If people are more effective at doing their jobs with a tool, their productivity would increase meaning their wages would also increase. Why do you assume this would be the case? Why would companies increase pay? > And if productivity increases that means it's worth to hire more people. No, it means the opposite. Companies can reduce payroll expenses without incurring a decrease in productivity. it's not clear to me that your bank branch example shows that automation increased employment. It seems more likely that as populations have grown, there was a corresponding increase in demand for bank branches. But that's just speculation either way. Do we have a good way of determining causality here?

bko 4y ago
> Why do you assume this would be the case? Why would companies increase pay? It's pretty basic economics that says wages are based on productivity. If you were hiring would you pay more for a 10x engineer? If the current employer wouldn't pay you more you could leave as someone else would pay you since you're more productive Its self evident pretty basic economics. Disputing that you'd have to reinvent a lot of basic economics Dev tools made programmers many times more productive. Do employees just stop hiring as many programmers?
- mullingitover 4y ago
  > It's pretty basic economics that says wages are based on productivity. This is a nice idea that plays to the human sense of fairness, but wages have been completely decoupled from productivity for about the last four decades[1]. The only thing that really raises wages is the market power of laborers. Wages have stagnated or fallen as the market power of labor has eroded. [1] https://hbr.org/2015/06/the-great-decoupling https://hbr.org/2015/06/the-great-decoupling
  - bko 4y ago
    You're looking at aggregate values. And there's a lot going on including benefits. It's hard to tease out. But use common sense. It's not about fairness. If you had a goose that lays golden eggs that you can sell for $100 net of costs. You'd pay up to $100 for the goose. If suddenly it started producing double the eggs you'd pay up to $200 or someone else would outbid you. The only way the goose wouldn't be able to get a higher salary is if competitors were not greedy as it's basically free money and just let the current owner profit from the goose's productivity gain

mrguyorama 4y ago

FYI, US population in 1970 was only 200 million

tinglymintyfrsh 4y ago

Well, you need many fewer people to do the same amount of work. In America in particular, there isn't enough income or jobs in the low/no skill area to survive. Suicide and deaths of despair rates amongst middle-aged and older in this demographic are astronomical. In the relatively near future, it won't be necessary to have as many software engineers to run a very large company.