Computers, artificial intelligence programs, and robots are doing more of the work that humans used to do. Data from the Bureau of Economic Analysis show that the amount of technology used per unit of production doubled between 2001 and 2015.* There’s no reason to believe this trend will slow anytime soon.
What does that mean for jobs? Researchers from the University of Oxford estimate that 47% of U.S. jobs could be automated as soon as 2025, meaning about 70 million Americans could find themselves out of work.** Estimates from the World Bank put that figure at 69% for India and 77% for China.†
These statistics paint a bleak picture of the future, but it’s one I have to respectfully disagree with.
Tasks are not jobs
I found it hard to square automation being a job-killer with the current U.S. unemployment rate of well below 5%. In fact, 75% to 85% of the world’s economies are at or near full employment. That disconnect prompted me and my team to dig deeper into how all of us spend our time at work and how our jobs have evolved in response to technological advances.
We researched nearly 1,000 occupations and classified the more than 18,000 activities people do into 3 loose buckets totaling 41 tasks. We found that most of us spend our collective workdays on:
- Basic tasks—harvesting, moving objects, and recording information.
- Repetitive tasks—assembling, inspecting, and processing information.
- Advanced tasks—problem-solving, strategizing, and creative thinking.
Advanced tasks are uniquely human. No matter how smart a computer becomes, humans have a comparative advantage in executing them. IBM’s Watson knows every fact and figure about the Battle of Trenton. But it can’t think creatively and inspire us the way my 11th-grade history teacher did when he walked us across the battlefield in the dead of winter and told us to take off our shoes. “There’s a foot of snow on the ground,” we protested. “Gentlemen,” he said, “the American volunteers who fought here that day didn’t have shoes on their feet.” When I close my eyes, I can still feel the snow beneath my feet. And I’ve been a student of history ever since.
Automation is accelerating the evolution of human labor
As recently as 1850, the U.S. workforce spent 80% of its time on basic tasks. Farmers had to spend almost all day in the fields, and they had little time for anything else. Today, thanks to mechanization, we spend only 10% of our time performing basic tasks.
By 1940, the rise of manufacturing and the assembly line created the middle class. The developed world’s labor force was spending 80% of its time on repetitive tasks. That work provided a good living for many, and it happened to be made up of tasks that technology has been automating away since then. To give you one example close to home for me: Mutual fund net asset values, once calculated by hand in a leather-bound ledger, are now determined more quickly and accurately by computer.
Today, we estimate that we spend about 50% of our time on advanced tasks. Art and engineering are among the professions that scored the highest for advanced tasks in our research, but every occupation we looked at has moved up the task complexity ladder. And over the past 15 years, technological advances have increased the proportion of advanced tasks most quickly in auto mechanics, astronomy, and desktop publishing.
To put things in perspective, certain jobs now consist of 20% more advanced tasks than they did 15 years ago. That’s an additional full day of work every week devoted to uniquely human tasks. (Which profession has changed the least? Mine: economist. It truly is the dismal science.) As you can see in the chart below, we expect the trend to accelerate—automation-proof tasks may occupy up to 80% of our time 10 years from now.
Time humans spend doing uniquely human tasks
Sources: Vanguard calculations based on data from McKinsey & Company, U.S. Bureau of Labor Statistics, and U.S. Department of Labor O*NET OnLine.
More and better jobs
Automation anxiety isn’t without merit. Jobs that are largely made up of repetitive tasks—those in the auto manufacturing industry, for example—have been shrinking for decades. And automation will claim new victims in the future. It’s unfortunately hard to see, for example, how taxi drivers will fare in a world of self-driving cars.
But for the vast majority of workers, automation will continue to elevate or, if you will, “upcycle” their jobs by eliminating some of the tasks they don’t want to do and allowing them to spend more time on engaging ones. In an irony that will surprise pessimists, robots will make our work lives more human.
*Sources: Vanguard calculations, based on Bureau of Economic Analysis input-output tables and Thomson Reuters Datastream.
**Frey, Carl Benedikt, and Michael A. Osborne, 2013. The Future of Employment: How Susceptible Are Jobs to Computerisation? Oxford, United Kingdom: University of Oxford.
†The World Bank (2016). World Development Report 2016: Digital Dividends. Washington, DC: The World Bank.