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by Mish

I do not know, nor does anyone else. But does that mean jobs won’t come?

Is technology destroying jobs for the first time?

Daniel Lacalle on the Hedgeye blog offers this bold claim: Face It, Technology Does Not Destroy Jobs.

"If you read some newspapers and politicians’ comments, it seems that technology companies are a threat and robots will take your job . The idea is interesting and has populated hundreds of pages of science fiction books that feed on a dystopic view of the future where humans are only an annecdote.

It’s an interesting idea, there’s only one problem. It is a fallacy.

The idea that technology will destroy jobs starts with exaggerated estimates – as always – with the objective of presenting a world in which there must be an intervention – fiscal, of course – from governments, in order to save you from a future that has always been wrongly predicted … But this time it’s different.

The empirical evidence of more than 140 years is that technology creates more jobs than it destroys and that there is nothing to fear of artificial intelligence. Randstad studies show that technology will create more than 1.25 million jobs in Spain alone over the next five years.

Evidence shows us that if technology really destroyed jobs, there would be no work today for anyone. The technological revolution we have seen in the past 30 years has been unparalleled and exponential, and there are more jobs, better salaries.

The best example is the German region of Baviera, one of the parts of the world with a higher degree of technification and robotization, and with a 2.6% unemployment. An all-time low. The same can be said about South Korea, and the world in general.

When I started to work in 1991, they told us that machines would take our jobs. Today, there is a lower unemployment and the workforce has grown massively. Today, they tell us the same thing. If 47% of jobs are going to disappear in 20 years, many more will be created.

Most of the jobs we know today did not exist ten years ago. Technology does not destroy employment, what it does is free capital from obsolete sectors to new sectors and, thereby, improve the quality of life of all and, in addition, create many more direct and indirect employment.


In fact, technology only destroys the jobs we do not want anyway. What society, all of us, must do is to create the conditions for us to be prepared for the new world.


What does not work, nor has it ever worked, is to try to put barriers to technology, penalize the efficient, try to stop progress, with the objective of perpetuating obsolete sectors under the excuse of “employment”. It neither defends the existing jobs nor solves the problem.

If politicians want to defend the job, why not ban tractors and put the whole world to work in fields, like Pol Pot?. You may say this is an exaggeration, but this nonsense is the same fallacy as placing barriers to technology to perpetuate obsolete jobs.

Interestingly, those same people who “predicted” the end of oil, water scarcity, massive food shortages, the end of pensions, hyperinflation, and slavery to machines, all wrong, are the ones who say “this time is different “, today.

Let us be clear. All that is sought by promoting scaremongering estimates is to find an excuse to increase your tax burden. If politicians really cared about employment, they would be giving tax breaks to technology companies and start-ups to train workers on high-added value jobs and helping them adapt to change, not squandering funds in useless subsidies. Less basic income and more basic knowledge.


The tax assault on technology companies is not a coincidence. It seeks to perpetuate obsolete industrial conglomerates, which in Europe have turned into covert social security systems. It seeks to prevent change instead of seeing high-tech companies as guarantors and leaders of the change, that create jobs and improve our quality of life of all.

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Rather the aim is to have citizens as hostage clients, addicted to Huxley’s Soma of State subsidies via welfare. It is more comfortable to subsidize idle capacity than promote progress.

Instead of making it possible for technology companies to grow and develop in Europe, politicians seem to prefer to subsidize low-added value sectors that generate sub-employment … and if a company buys a machine, a bureaucrat will decide how many jobs it is supplanting, only to pass the tax bill. Can you imagine if the hat manufacturers would have succeeded when they went on strike against Ford’s evil new automobile? Today, we would have all paid much more for cars and, above all, the hat industry would have succumbed anyway. Because putting barriers to progress is useless, and very expensive.

What politicians and those who make flawed 50-year predictions know is that the probability that technology and the democratization of information will generate more prosperity, employment and well-being for all is almost 100 percent.

What they also know is that it jeopardizes a rent-seeking revenue system that feeds many cronyist networks.

Technology does not destroy jobs. Politicians do. Never bet against human ingenuity."

Major Agreement

I agree with every point except for the notion “technology only destroys jobs we do not want anyway”. People who lose jobs most often want them dearly.

Donald Trump won the election on the notion China and Mexico stole our manufacturing job. Nope, automation took those jobs.

But this happens in every cycle. Phone operators lost their job, buggy whip manufacturers lost their jobs. The internet destroyed many jobs but it created more jobs than it took away.

Fast Path to Job Destruction

The fast path to job destruction is to get government involved.

  1. Regulations destroy jobs
  2. Minimum wages hikes destroy jobs
  3. Free handouts destroy jobs
  4. Tax hikes destroy jobs

The fastest way to destroy jobs would be to give everyone a minimum guaranteed “living wage”.

Too many people would be content to do nothing. Taxes would have to go up to support the freeloaders.

New Jobs From Where?

So where will the new jobs come from? I don’t know.

But I do know that millions of truck drivers will soon lose their jobs, and those are jobs the drivers want.

Technology always creates painful disruptions. But the correct approach is to do nothing.

Technology has always created jobs even if we do not know what that technology will be.

The problem is government and the Fed, not technology. The government is hell-bent on policies that destroy jobs and the Fed is hell-bent on producing inflation in a technological price deflation world.

Blame the Fed and governments, not technology, for alleged “living wage” problems.