Lexpert magazine features articles and columns on developments in legal practice management, deals and lawsuits of interest in Canada, the law and business issues of interest to legal professionals and businesses that purchase legal services.
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LEXPERT MAGAZINE | NOVEMBER/DECEMBER 2018 83 BY GEORGE TAKACH TECHNOLOGY Despite doom-and-gloom prophecies, the 'substitution process' will replace jobs lost through innovation Work in Our Innovation Civilization IN MY LAST COLUMN, I painted a fair- ly rosy picture of our "Innovation Civiliza- tion," built upon the foundation of count- less scientific and social inventions and improvements over the last few thousand years, and in particular since 1950. Nonetheless, critics abound, especially those who argue that a future of hyper in- novation in soware infused networked robotics, automation, artificial intelligence, big data and machine learning will produce a dystopian world of mass unemployment and resulting social dislocation. I am oen asked whether I have misgiv- ings about the unemployment that will in- evitably follow the new IT innovations that I am helping clients develop or implement. My short answer is that the prediction for a bleak future with crippling rates of unem- ployment is not going to unfold, given the experience of the OECD countries over the last 70 years, during which time massive amounts of IT products and services have been adopted by organizations around the world. Here are some of the longer reasons bolstering my view. WE HAVE SEEN THIS MOVIE BEFORE History teaches us that technology has not produced overall rates of high unemploy- ment. Some technologies do displace some workers; there are, for example, few if any buggy makers, given that about 100 years ago the automobile supplanted the horse and buggy as the predominant mode of personal transportation. But here's the thing. e lost jobs in the buggy-building industry have been more than replaced by jobs in the automobile assembly sector (and the auto parts manu- facturing industry), notwithstanding that auto assembly plants are among the heavi- est users of robotics in the world. And that is not counting the many new jobs created in the factories producing the robots, and in the offices writing the soware code for the robots, and the many thousands of well-paid technicians employed installing and servicing robots. Hundreds, if not thousands, of examples of this "substitution process" can be cited. We have also seen this shi in employ- ment generally at the macro level. For ex- ample, on the eve of the First World War nearly 100 years ago, 80% of Canadians were employed on farms; we were, in es- sence, a nation of farmers. Currently, only about 2% of the population is employed in farming. And yet, the agriculture sector produces far more; how is that possible? In a word, it's due to automation. e tractors, combines and harvesters that do virtually all of the heavy liing on the modern farm need precious few people to operate them. But the result has not been massive unemployment. Rather, the chil- dren of farmers migrated to the cities to work (initially) in factories, and more re- cently in the "services sector." So, bottom line, fewer farm jobs, but many more in- dustrial and service jobs. As an example of a relatively new service sector business, consider the leisure indus- try. Since the 1950s, the democratization of transoceanic travel, courtesy of the in- vention of the jet-propelled airliner (which now flies between Montreal and London in six hours, replacing the ocean liner which took six days to make the same jour- ney — a period of time only the idle and the rich could afford), has produced a huge industry accessible to the middle classes of OECD countries and countless others. To- day, globally, 10% of the Earth's work force is employed in one fashion or another in the leisure industry. is shi, from farming to manufactur- ing and services, has occurred in many oth- er industries and segments of the economy. Again, compared to 100 years ago, many more people in Canada are employed in educational institutions, and it's not merely an explosive growth in the numbers of teachers and professors. Health care is another good example. Yes, there were doctors and nurses 100 years ago, but not nearly in the numbers we have today. Or consider the "cultural in- dustries," or retailing, or property manage- ment, or the companies that service the en- ergy industry. e list of new and expanded businesses — not to mention the explosive growth of the public sector over the past century — is very long, and the result is fairly low numbers of unemployed. "BUT NOW IS DIFFERENT" ese historical examples, however, do not give certain commentators comfort. ey say that "now is going to be different"; that the new IT products and services, includ- ing artificial intelligence, machine learn- ing, and big data applications will cause tens of millions to lose their jobs, and there will not be another auto or leisure industry waiting in the wings to soak up the dis- placed workers. ere have been many studies trying to predict with some precision just how many people will be uprooted from their current PHOTO: SHUTTERSTOCK | COLUMNS |