The year is 1811. Recent adoption of steam power in industries have resulted in a shift from hand production methods to machines. Under the cover of darkness, a small group of workers at the local textile factory in Nottingham snuck into their workplaces and started destroying the machines they were using to produce yarn just this morning. The Luddite Movement was gaining traction and spreading rapidly through England. The Luddites objected to the rising popularity of automated textile equipment, threatening the jobs and livelihoods of skilled textile workers.
Lessons from the industrial revolution of the 1800s
With the benefit of hindsight, there seems to be nothing much to fear about. The industrial revolution ushered in era of growth in productivity and quality of life in the late 1800s. It is easy for economists look at the 100 years of data and conclude that technology fears are completely unfounded as the industrial revolution result in more job and wealth creation in the long-term.
While we agree with the economists taking a grander scale of time, as individuals, we do not think in terms of centuries. So it begs the question - what was the industrial revolution like from the perspective of an individual? Suffice to say that the Luddites were disillusioned about their lives and livelihoods for a reason.
In a paper published by Feinstein, he highlighted that despite the great leap in technology, real wages earned by workers in the UK were stagnant for 50 years between 1780-1830! For perspective, the average working life duration is just under 40 years. Despite rapid technological progress, the average worker never experienced any improvement in living standards. The harsh reality is that although the industrial revolution brought about productivity growth, the distribution of that wealth was far from equitable. As textile companies replaced workers with machines, companies and their owners benefited at the expense of the workers.
Are robots and AI replacing jobs? Yes, absolutely
Time - Millions have lost jobs in the pandemic and robots are replacing them faster than ever
World Economic Forum - 85 million jobs will be displaced by 2025
Oxford Economics - 20 million manufacturing jobs will be displaced by robots
Stephen Hawking - We cannot quite know what will happen if a machine exceeds our own intelligence
Elon Musk - AI will make your job kind of pointless
Mark Cuban - Robots will cause unemployment and we need to deal with it
The silver lining: change brings about opportunity
For all the warnings about technological disruptions, we are much more optimistic about the future. We see many new jobs being created as old jobs are displaced.
The last 3 industrial revolutions brought about a redistribution of capital and resources:
Steam Revolution (1765) - Capital benefited at the expense of labor
Electricity Revolution (1870) - Mass production caused prices of goods to fall benefiting consumers
Electronics and Computing Revolution (1969) - Individuals with computing abilities benefited at the expense of the 'have nots' in the digital divide
We think that the coming 4th industrial revolution driven by robots and AI will do the same with its effects being similar to that of the electronics and computing revolution in the 1900s (Read: The coming coding divide).
3 crucial abilities to thrive in the coming 4th industrial revolution
Learn to use technology to solve problems - Coding will become ubiquitous in the workplace
Sharpen critical thinking - There is value in being able to interpret and draw conclusions from data
People management - Robots can never replace human leadership in the workplace
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