Some years ago, unemployment in Germany was very high (see how the numbers have fallen since). At the time, there was a heated debate about whether technical progress was to blame for high unemployment.
In my memory, the majority of Germans adhered to this theory. It seemed pretty plausible. Robots replace workers. In the long run, we all will run out of work, many thought.
It didn’t happen that way. Why not?
First of all, yes, technical progress indeed destroys jobs. But ideally only as a first step.
The development of agriculture is the most amazing example of this.
Two centuries ago, 2 out of 3 people in Germany worked in agriculture. A hundred years later, it was 1 in 3. Today it is just about 1 in 100. At the same time, the food supply has increased significantly.
But what is crucial here: At the same time, people who were no longer needed in agriculture have migrated to other branches. Not without friction, but successfully in the long.
The development of railways is another example.
Nowadays, trains often run with a staff of two people: the train driver and the conductor.
What a contrast to the past! In the age of the steam locomotive, three people were needed in the driver’s cab alone (the driver, stoker and guard). The effort to heat up the locomotives in advance was also high. And regular filling with water had to be ensured by people, too.
The size of many old train station facilities gives an idea of how many staff were needed to operate trains in the past.
The result of these efforts: travelling by train was a luxury good.
Today everyone can afford to travel by train. And the comfort has grown steadily.
But technical progress has its price. There are no longer any staff at small stations, and trains often run without supervision.
So I guess quite a few people miss labour-intensive old days (also me sometimes), but only some people still believe that technical progress per se drives up unemployment. Simply because unemployment is low in Germany. Even more, there is a lack of employees in many branches.
A wise business journalist once wrote (he wrote it when unemployment was at its peak in the 2000s, which was brave): As long as people have wishes and as long as other people can fulfil these wishes, we will not run out of work.
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