Into the Unknown

In: English and Literature

Submitted By Composer
Words 763
Pages 4
“HAS the machine in its last furious manifestation begun to eliminate workers faster than new tasks can be found for them?” wonders Stuart Chase, an American writer. “Mechanical devices are already ousting skilled clerical workers and replacing them with operators...Opportunity in the white-collar services is being steadily undermined.” The anxiety sounds thoroughly contemporary. But Mr Chase's publisher, MacMillan, “set up and electrotyped” his book, “Men and Machines”, in 1929.

The worry about “exporting” jobs that currently grips America, Germany and Japan is essentially the same as Mr Chase's worry about mechanisation 75 years ago. When companies move manufacturing plants from Japan to China, or call-centre workers from America to India, they are changing the way they produce things. This change in production technology has the same effect as automation: some workers in America, Germany and Japan lose their jobs as machines or foreign workers take over. This fans fears of rising unemployment.

What the worriers always forget is that the same changes in production technology that destroy jobs also create new ones. Because machines and foreign workers can perform the same work more cheaply, the cost of production falls. That means higher profits and lower prices, lifting demand for new goods and services. Entrepreneurs set up new businesses to meet demand for these new necessities of life, creating new jobs.

As Alan Greenspan, chairman of America's Federal Reserve Bank, has pointed out, there is always likely to be anxiety about the jobs of the future, because in the long run most of them will involve producing goods and services that have not yet been invented. William Nordhaus, an economist at Yale University, has calculated that under 30% of the goods and services consumed at the end of the 20th century were variants of the goods and services produced…...

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