Technological unemployment as an upcoming wave of pandemic


Seeing the rise in the number of unemployment cases during the second wave of Covid-19, it must be an innocent act if we do not gear up ourselves for the future pandemic. The digitalization of our future can be a blessing for some but may also be a shadow pandemic for the most. Digital future guarantees growth but not development. The potential of technology is cusped with the harm it can carry. One such harm that could be brought by the technology is the new wave of unemployment often known as technological unemployment. This term was coined by John Keynes in order to warn the future of this problem being unavoidable.

John Keynes has predicted the scenario of “technological unemployment” where due to the discovery of new means of technology, the use of labor would be economized outrunning the pace where we could find new jobs for them.[1] He predicted this scenario during the Great Depression in 1930 and coined this term in his one of the writings i.e. “Economic Possibilities for our Grandchildren”. In his essay, he showed his concern “about the increase of technical efficiency that has been taking place which is certainly faster than the problem of labor absorption”.

Technology has certainly created an ambiguous effect on the labor market. To make it simpler for what Keynes meant with the term technological unemployment, it is necessary to see the present scenario where it is so evident how robots are being found as alternatives to waiters, managers; how Recidivism and Risk Assessment tools are found as an alternative to judges and Police strategists; how conversing through mobile phones have automated the jobs of the postmen; how using machinery have replaced the workers of the industry, etc.

Therefore, what can be understood is the concept of effective substitution of labour vis-à-vis capital. Such substitution occurs when some resource is a better alternative and also provides cost restructuring. In the present case, the machinery and other forms of technology are more effective than human labor and are more productive with a minimum intake of resources. So, when an employer finds a better alternative, he would then increase capital and decrease labor. Eventually, this analogy will give risk to individuals getting unemployed in the short to medium term and hence, rising unemployment. This unemployment which is the result of technology is termed as technological unemployment by Keynes.

The ups and downs have led to a meeting of minds of a fearful situation where the market is at the risk of being automated and there would job-loss in the form of the Luddite’s Movement that took place in the 19th century. Such would happen in a time of uncertainty where modern Artificial Intelligence technologies adopted by the labor itself would in return make them unemployed in the future. However, Keynes predicted the problem of technological unemployment as just a temporary phase of maladjustment which would be improved with time. Nonetheless, seeing today’s time, Keynes is a hundred percent correct with his claim that technology would leave humans behind and therefore impacting human labor leading to unemployment.

The challenge of technological unemployment is not naïve but strong enough to be called as pandemic because right to employment is a right important for subsistence and without the same, existence of human being is difficult. Robert Skidelsky, a British economic historian has written in his book “Work in the Future” that “Sooner or later, we shall run out of jobs”.[2] It was estimated that 47% of the jobs in the United States are at risk of being automated due to Artificial Intelligence.

With the growth of Artificial Intelligence, society is heading towards an unparalleled revolution that will severely affect the labor and employment market. The world’s economic condition is already disturbed and so is the condition of the labor market which is now misbalanced due to lockdowns, curfews, and cost-cutting activities. Therefore, the government should come out with reasonable and adequate policies for the corporates and under institutions regarding adoption of artificial intelligence technologies in which the interest of the employers

[1] P. Wilson, “Did the Luddites Get it Right? Automation and the Labour market”, The Student Economic Review, Vol. 31, 2017 (hereinafter Luddites).

[2] Robert Skidelsky, Work in the future: The automation Revolution, Palgrave MacMillan, March 2020.

Sahajveer Baweja
Sahajveer Baweja
Institution- 3rd-year B.A.LL.B. student at Rajiv Gandhi National University of Law, Patiala, India


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