Eric Schmidt is worried about the machines taking over. Speaking at the World Economic Forum in Davos last week, Google's executive chairman gave warning to his chattering-class audience that their jobs were under threat from technology as never before. "The race is between computers and people – and the people need to win," he said.
If the Google boss is worried, that suggests we might really have a problem. After all, he is not just at the cutting edge of the digital economy; Google is investing in self-drive cars and robotics companies. Today, Google announced the purchase of Deep Mind, a U.K. artificial intelligence start-up company which aims to combine the spheres of computing and neuroscience. So Mr. Schmidt can probably see a little way into the immediate future and his warning is about deskilling in areas previously thought protected from automation, such as research, as well as service jobs, such as driving vehicles.
While Mr. Schmidt's vision may be entirely plausible, it is probably not wholly accurate. Firstly, technology does not necessarily lead to human redundancy, and secondly, because efficient automation does not always create its own demand. The Luddite machine-breakers of the 18th century failed to stop the adoption of spinning machines and agricultural machinery. However, we know that these technologies created a colossal expansion in manufacturing jobs, a transition from rural to urban employment that continues to this day in India and China.
That process is unstoppable but in our modern world, technological efficiency is not always so quickly adopted. Google is banking on driverless cars but consider something much simpler – driverless trains. The technology exists to run complex computerized rail networks without drivers. London's Docklands Light Railway is one such system which has operated for a decade without significant problems, yet there has been no attempt to extend the technology to London's underground Tube network. Part of the problem is certainly fear of militant opposition by trade unions, but the anxiety underlying that concern, among public transport managers and government alike, is that the public would not welcome it. This is not about safety – nearly all major rail accidents of recent years have been due to driver mistakes. A computerized system would certainly be safer but, notwithstanding the clear advantages of driverless trains, people still want to see human beings in charge.
The issue is trust, and it explains the real problem that underlies Mr. Schmidt's musing about a world of servers and cyborgs presided over by a ruling class of super-clever humans. Mr. Schmidt says that even highly skilled middle-class jobs "are being automated out," and are being replaced by less prestigious service jobs. The solution, he reckons, is to speed up the process of private sector innovation (less government interference) and improve skills and education (more government help), thus replicating the 19th century manufacturing revolution in a digital age.
Yet there are disquieting signals from the employment market that suggest this will be very hard to achieve. Youth unemployment in Europe is at levels which can only be described as catastrophic – almost 60 per cent in Spain for adults under 25. In Britain, unemployment is now falling quickly but real incomes (taking into account inflation) are still dropping, providing yet more evidence that the digital economy is making the well-off better-off while the masses shuffle on. People are taking cuts in real pay just to keep on getting paid.
The widening gap between the owners of capital and the highly-skilled, compared with the un-skilled and de-skilled, is causing some panic in government. So concerned is the Conservative Party about the political fallout from evidence of continuing decline in incomes that it has decided to support a big increase in the minimum wage and many Tory MPs are now converted to the idea of supporting a "living wage," a minimum pay rate set at a much higher level, in line with the local cost of living.
This is anathema to employers, and the Confederation of British Industry is opposed, but it is the Tories – those groups' natural political supporters – who are promoting it. If they are doing so, it is because they have little confidence that government can achieve throughout the population the levels of numeracy, literacy and intellectual skill demanded by employers such as Google. We can't raise the brain power of the general human population in order to fit the needs of a small band of megalomaniac software companies.
The missing piece in Mr. Schmidt's futuristic scenario is politics. Computers may be de-skilling millions but this is unlikely to be allowed to continue without consent or large compensation. The solution, as proposed by recent political campaigns, is to buy consent, first with higher minimum wages or even basic wages, a minimum wage payable regardless of employment. Either way, it looks like Mr. Schmidt will be paying a lot more for his cleaner, even if all she does is tell the robot to mop the floor.
Carl Mortished