Pub. 14 2017 Issue 1

O V E R A C E N T U R Y : B U I L D I N G B E T T E R B A N K S - H E L P I N G N E W M E X I C O R E A L I Z E D R E A M S Issue 1 • 2017 15 Recently, Treasury Secretary Steven Mnuchin stated that widespread job displacement due to automation is 50-100 years away and that “it isn’t even onmy radar screen”. However, many experts sharply disagree with Mnuchin’s assessment. Perhaps Mnuchin is simply being optimistic or, as a political ploy, he is telling people what they want to hear. Nobody wants to hear that certain jobs may be disappearing and it is certainly convenient politically to quell the worst fears of many people. However, it is important to realize that the possibility of widespread automa- tion is not something that can be swept under the rug. It must be addressed like any other societal inevitability. Mnuchin’s assessment was almost universally disagreed with by experts on the topic, so that certainly leads to the logical conclusion that he made the statement as a way to curry political favor. The concern among many automation experts is that if companies don’t prepare for automation, there could be widespread job loss and a missed opportunity to retrain workers. CEOs from numerous companies, including IBM and Salesforce, believe it is the responsibility of companies to educate and retrain em- ployees in order to prepare them for different job opportunities. Neglecting the potential job loss due to automation would simply be a dereliction of duty. According to a report by PricewaterhouseCoopers, 38% of jobs could be lost to automation by the early 2030s. This report is obvi- ously on the other end of the spectrum fromMnuchin, whileMusk falls somewhere in themiddle. According to the report, inGermany, thenumber is 35%. In theU.K., thefigure is 30%, followedby Japan at 21%. Thefinancial services sector is one that the report discusses specifically due to the fact that it is not immediately thought of as being affected by automation. The U.S., according to the report, is more focusedondomesticfinancial services,whereas theU.K. tends to be more focused on international banking, therefore limiting many U.S. employees to more routine tasks. The report stresses that any job that entails fairly routine tasks is in serious danger of being replacedby automation. Jobs that require creative or critical thinking will simply be impossible to duplicate by automation, ac- cording to the findings of the study. Another finding of the report is that education and health care are two areas that should not be affected by automation in any significant way. Even after all of these findings, there is some reason for opti- mism among the workforce. Experts say that very few jobs can be fully automated to the extent where there is no need for human presence. Many jobs that could turn to automation would still require human beings to oversee the process. But some jobs, notably in manufacturing and retail, will take on fewer hours and fewer responsibilities. But how do we, as human beings, deal with this inevitability of having some of our ability to work no longer deemed necessary? Mark Cuban, the billionaire entrepreneur, believes that employers will soon be on the hunt for employees who specialize in creative and critical thinking. “There are no manufacturing jobs coming back. There are no coal mining jobs coming back,” said Cuban. “I personally think there’s going to be a greater demand in 10 years for liberal arts majors than for programmingmajors andmaybe even engineer- ing.” Cuban cites foreign languages and English as two areas that could be particularly useful in an ever-changing world. Whether one agrees with Cuban’s assessment is certainly up for debate. However, his overall point is relevant. The basic skill of a human being that cannot be replaced is communication, whether it’s by the written or spoken word. The ability to come up with innovative ideas, to think outside the box, will become more andmore crucial. The days of being trained for one specific skill could become extinct. Being able to view the world and ideas in much broader terms will become increasingly crucial. The influx of more technology may not just be seen with jobs be- ing eliminated. In more higher-skilled jobs, it could result in more opportunity tomoveemployees todifferent positions, thus eliminat- ing other positions. It won’t necessarily affect entire highly-skilled industries, butmore likelyreduce thenumberof employees required. The concern among some experts is that an increase in automation couldleadtoevenmoreconcentratedwealthamongthefinancialelite and create unprecedented economic inequality. However, Boston University economist James Bessen is reasonably optimistic about an increase in automation. He states that advances in technology often lead to more jobs, but the nature of the work changes. He cites ATMs as not eliminating bank tellers, but ultimately resulting in bank tellers becoming more highly-skilled. He also cites factory workers becomingmore highly-skilled in the wake of the Industrial Revolution. Onceagain, this raises the issueof employers re-training their employees to become skilled in new areas. Society is at a crossroads with technological advances. Jobs seem to be one of the top issues that many politicians discuss, but it is often not accompanied by the discussion of how the world is changing. In the last 15-20 years, we have seen many facets of everyday life change drastically. Sometimes, we fail to realize how quickly things do change. As an example, there used to be numerous major book store chains, which have been replaced by online retailers. Some people are now even getting their gro- ceries delivered through online programs that monitor nutrition as opposed to going to the grocery store. These changes can be unfortunate, but often inevitable. It is vital that politicians get on board with many technology experts and start leveling with American citizens that certain jobs will not be coming back. It is simply dishonest to continue the charade that a boom of manufacturing jobs will be returning, for example. The way to tackle this issue is to address it head-on, let Americans know that a loss of jobs due to automation is on the horizon, and come up with solutions. Burying our collective heads in the sand will ultimately lead to a great deal of disappointment and dis- placement and won’t be beneficial to our society as a whole. The scientist Stephen Hawking once said, “Work gives you meaning and purpose. Without it, life can be empty.”  Society is at a crossroads with technological advances. Jobs seem to be one of the top issues that many politicians discuss, but it is often not accompanied by the discussion of how the world is changing.