Elimination of jobs by automation

Throughout the industrial revolution and its subsequent evolution, automation has been criticized as the harbinger of mass unemployment and the dehumanizer of the working man. The increasing use of computers and numerical control technology has prompted similar concerns. This new technology, although vital for industrial competitiveness, has enormous potential for eliminating jobs; in the industries where microcomputers have been extensively applied the impact on jobs is considerable. The assembly operations will be increasingly automated in the electronics industry. This, in turn, implies a drastic reduction of low-skill job opportunities, combined with a drastic increase in the investment outlays required per new job created.

The fear that automation causes job elimination is not new, and has led to violent reactions throughout history. A mob in Germany in the 1660's drowned the inventor of a mechanized loom; steam engines and power machinery were frequently smashed in 19th century England; and in the 1920's in the USA claims were made that mechanization and the use of electrical machinery would ruin the economy.

The new wave of automation from the 1970s, associated with the new microelectronic technology and new managerial and organizational engineering (notably in Japanese corporations), further accelerated the process of rationalization and reduction of jobs in many labour intensive sectors such as the steel industry, shipbuilding, textiles, automobile manufacture and the components industry. The newer lean production systems (Toyotism) continue the trend established by the earlier assembly line Fordism. Emerging techniques of concurrent engineering and re-engineering are not forecasted to reverse this trend and are likely to increase it. One estimate in 1993 indicated a possible loss of 2.5 million jobs in the USA from re-engineering. It is increasingly recognized that development of the services industry is unlikely to compensate for these developments since technological breakthroughs are also reducing jobs in that sector.

In the early 1970s in the cash registers industry, a major manufacturer reduced its employment from 37,000 to 18,000 with the changeover to microelectronics. One micro-computer replaced 350 mechanical sewing machine parts, and an electronics plant in West Berlin cut employment from 1,8000 to 800 by switching to this new technology. At a car plant in Sweden an automated welding line reduced the workforce from 50 to 10.