An Overwhelming Force.
The future on The Post Road.
This “memo” first appeared at Political News Items.
One of the features of the Trump administration is this: The president says something or does something outlandish. The news media goes crazy. The relevant advisors and Cabinet officials scramble to come up with an explanation, to the disbelief of nearly all concerned. MAGA “influencers” are dispatched to describe the latest brouhaha as yet more evidence of news media/Deep State malevolence.
So it was with the president’s decision to fire the head of the Bureau of Labor Statistics (BLS). Mr. Trump was annoyed by the jobs report because it contradicted his “narrative” of a great economy humming along under his great leadership. Shortly after the report was made public, Trump tossed the offending BLS commissioner overboard. Administration officials then scrambled to explain why the BLS commissioner’s dismissal wasn’t what it so obviously was. MAGA world banged the Deep State drums.
It didn’t have to go that way. Mr. Trump might have “contextualized” (sorry about that) the jobs report by saying: “We expected a downdraft because of our success with DOGE reducing the government’s head count. We also expected that implementing a much stricter immigration regimen would skew the jobs report. So we’re not surprised by these data. The jobs market will ‘adjust’ in the coming months. Tariffs will mean more job openings for American workers, as more foreign companies invest more in America. Energy prices are coming down. Capital markets are as strong and as deep as they’ve ever been. We’re poised for better days ahead. It’s just going to take a bit of time to get there.” That would have kept the jobs report story at least somewhat “contained.”
Alas, “containment” is not Trump’s style. It bores him. Shooting the messenger, igniting a news media firestorm, dispatching the minions to put out the fire, that’s more to his liking.
Shooting the messenger is a time-honored solution to any number of knotty problems, but it doesn’t work when the “audience” can check it against everyday facts. President Biden spent months and months asserting inflation was “transitory”. Everyone knew it wasn't “transitory” because they frequented grocery stores and gas stations. The political consequence of "“transitory” inflation was Mr. Biden’s abysmal approval rating.
President Trump’s present circumstances are more politically perilous than Mr. Biden’s, but not because of one downbeat jobs report. Peril looms because the overwhelming force of Artificial Intelligence is bearing down on the job market. The "audience" knows it. They can see it coming. It’s like a storm gathering, not that far away.
I drive up and down “The Post Road” in Fairfield County (CT) almost every day. When I do, I pass office buildings and storefronts that are the workplaces of insurance brokers, local and regional bankers, mortgage brokers, lawyers, accountants, consultants, marketers, real estate agents, etc. And what I think about all those people as I pass them by is this: The companies they work for will employ 10%-25% fewer of them in (probably) two years, maybe three.
What those people do (or did) will be done by AI. Accounting firms that employ 18 people will need only 14 people. Law firms that employ 24 people will need only 18 or 20. And when AI reaches into something like “wealth management”, which advisory firm would you choose: one that had all of JPMorgan Chase’s massive AI infrastructure and expertise or a “boutique” firm that did not? The question is the answer.
It’s certain that a lot of jobs will be rendered redundant in the (very) near future, as “AI for business” applications become ubiquitous and are deployed by businesses.
Here’s a list of 20 jobs and careers AI is unlikely to ever touch, according to Microsoft:
Dredge operators
Bridge and lock tenders
Water treatment plant and system operators
Foundry mold and coremakers
Rail-track laying and maintenance equipment operators
Pile driver operators
Floor sanders and finishers
Orderlies
Motorboat operators
Logging equipment operators
Paving, surfacing, and tamping equipment operators
Maids and housekeeping cleaners
Roustabouts (oil and gas)
Roofers
Gas compressor and gas pumping station operators
Helpers–roofers
Tire builders
Surgical assistants
Massage therapists
Ophthalmic medical technicians
The vast majority of the companies and businesses I see when I drive up and down The Post Road don’t offer the services above.
This gets to the second problem looming in Mr. Trump’s political future. All of those people whose jobs will be made redundant by AI have, in the main and at the moment, private health insurance and 401(k) retirement plans. The vast majority of them don’t qualify for Medicare, so when they're laid off, their only option will be “Obamacare”; a safety net to be sure, but nothing like what they’re used to and have come to expect. The vast majority of them are also too young to qualify for Social Security, so guaranteed income is years or decades away.
They’re out and they are unlikely to become motorboat operators, logging equipment operators, paving, surfacing, and tamping equipment operators or maids and housekeeping cleaners. Figuring out how to “reinstate” them into jobs that will provide them with a decent living, health insurance and retirement income is the next big challenge for policy-makers, here in the United States and around the world.
A renaissance of American manufacturing, which Mr. Trump is promising, isn’t going to solve the problem. If it occurs, the jobs created by a renaissance of American manufacturing will increasingly be done by robots. This from The Wall Street Journal:
The automation of Amazon.com facilities is approaching a new milestone: There will soon be as many robots as humans.
The e-commerce giant, which has spent years automating tasks previously done by humans in its facilities, has deployed more than one million robots in those workplaces, Amazon said. That is the most it has ever had and near the count of human workers at the facilities.
Company warehouses buzz with metallic arms plucking items from shelves and wheeled droids that motor around the floors ferrying the goods for packaging. In other corners, automated systems help sort the items, which other robots assist in packaging for shipment.
One of Amazon’s newer robots, called Vulcan, has a sense of touch that enables it to pick items from numerous shelves. Amazon has taken recent steps to connect its robots to its order-fulfillment processes, so the machines can work in tandem with each other and with humans.
“They’re one step closer to that realization of the full integration of robotics,” said Rueben Scriven, research manager at Interact Analysis, a robotics consulting firm.
Shooting the messenger isn’t going to work. It won't work politically because there won't be one messenger. There will be hundreds of thousands of them to begin with. And then more and more of them as AI scythes its way through white collar America.