Automated labor is substituting for human labor in an increasing number of tasks. Which jobs will survive and, most importantly, thrive in the future? Using a recent study and some handy BLS data, we're beginning to have some answers.
Carl Frey and Michael Osborne estimated the probability of computerization affecting 702 occupations, something no other study had done. They found that upwards of 47% of today's jobs are at high risk of being automated. Why? Machines have already encroached on routine labor thanks to their efficiency (and by not getting bored). They now have non-routine work in their sights. Big Data enables complex tasks to be rapidly scaled, a key comparative advantage relative to humans. Combined with robot's increasing dexterity and perception, computers are bringing both brawn and brain to the table.
Political risk is a fascinating yet not entirely objective field. As a result, it's hard for financiers and businesses to systematically or accurately incorporate political risk into decision-making. Foreign direct investment (FDI) has grown by a factor of 25 from 1980 to 2010, making it imperative that we get accurate measures of country risk. That's why a new NBER working paper may prove an important step forward.
The paper's authors take the spread between one country's sovereign debt yields and U.S. Treasury bonds and, using risk rating data and an assortment of economic variables, extract the political risk component. The result is the "political risk spread." Each country gets assigned a number reflecting its risk. In the chart below, you see how the authors apply this measure to countries without sovereign spread data—in other words, places for which we didn't have a good way to measure political risk before.
Four million open jobs exist throughout the United Sates due, in part, to a workforce that lacks the skills needed by the business community. As executive vice president of the U.S. Chamber of Commerce Foundation, one of my responsibilities is to lead on education reform, workforce development, and the skills gap. Education and workforce development has been an important issue for me ever since a chance encounter in Texas nearly 15 years ago.
In 1998, when I was CEO of Chase Bank in El Paso, I was approached by local civic and religious leaders who were concerned with the education system in the community and the future of young people in the area. Many high school graduates and those with high school equivalency diplomas were only able to read on a 4th grade to 8th grade level. Too few could actually read on a 10th grade level—a minimum for college work.
Sr. Pearl Ceasar, Rev. Dr. Ed Roden-Lucero, Joe Rubio, and a few organizers from the El Paso Interreligious Sponsoring Organization were proposing a “high skills” job training program for “in demand” skills (with job openings) for El Paso’s high school graduates. If it worked, people earning the minimum wage of $6.10 an hour would receive $10.50 an hour.
The need for job creation and economic growth dominates nearly every aspect of the current public debate, from STEM education to immigration reform to government programs. For many, whatever does not contribute to improving the job market and the national economy is a low priority, relegated to the sidelines until the country is back on its feet.
Some might argue that America’s work in outer space should take a backseat to the challenges Americans face every day. Yet, as counterintuitive as it may seem, reaching for the stars has big benefits for employment and the economy. It may even cost less than you think.
Is the glass half empty or half full? When it comes to the America's economic growth, Robert Gordon’s answer is clear—the outlook is dismal at best. His 2012 paper, Is U.S. Economic Growth Over?, argued that America’s years of rapid progress and growth were over.
Technological advances would not overcome the headwinds dragging economic growth down to 0.2% per year. Those headwinds included demographic shifts, educational attainment, inequality, and long-term debt increase.
Gordon's argument has sparked a lot of debate, so this month he chose to rebut his critics with a sequel paper. The question is, does it say anything new?