The future of robots and software automation doing the task of humans is here . . . and it first blush it’s downright scary. Robots replacing factory workers (an old but accelerating trend); autonomously driven vehicles threatening to make truck drivers and taxi drivers obsolete; and machines reading thousands of legal briefs in minutes are just a few examples of scenarios that sound like a sci fi disaster from an employment line perspective.

Should we be afflicted with automation anxiety? Yes and no, according to Joe Davis, Vanguard's global chief economist, who detailed his findings on the subject during a nearly hour-long presentation on Wednesday at the Morningstar ETF conference in Chicago. Actually, his ultimate answer leans heavily toward the “no” camp while acknowledging that the current and coming disruption will create some losers.

To begin his argument, Davis laid out what he sees as three paradoxes defining the economy and the markets right now: low inflation but full employment; low growth but high valuations in the market; and low volatility but high uncertainty.

“Some of my colleagues in the profession view these as either unrelated or isolated events,” Davis said. “But they’re not. In my mind they’re touchstones of a much larger force that will fundamentally alter the lives of millions of people on this planet.”

Davis believes we’re not in a period of stagnation but rather one of technical disruption, with more disruption headed our way. “And the nature of that change will bring four new paradoxes in the next three years.” (More on that later.)

“I argue that economists and policy makers have to pivot from focusing on GDP growth as the sole benchmark of an economy’s performance,” he continued. “More isn’t necessarily better. By growth, I mean productivity and standards of living, output per person and household income.

“I believe that we’re at an inflection point where today we’re seeing a structural change in the nature of work that will greatly impact the labor market not just for the United States but for the global economy,” he said. “How work changes for all of us in the years ahead will be the trend that defines our lifetime.”

That’s heady stuff, but what does this all mean for you, me and people who’ve yet to enter the workforce (or this planet)?

Davis provided context by looking at the past and potential pending consequences of economic disruption. Techno-optimists, Davis said, believe job losses caused by automation will be offset by new job opportunities being created.

“Throughout history the techno-optimists have always been right, he noted. “It happened twice before in the United States in the move from the farm to the factory, and then from the factory to the office. They’d say this time is no different.”

First « 1 2 3 4 5 6 » Next