The Labour Party, led by the now Minister of Finance, has made great play in recent years of the looming “threat” of automation, and the claimed need to think hard about the Future of Work. There was a taskforce in Opposition, repeated references in ministerial speeches, and now even a Future of Work Forum. I’ve always been a little sceptical: the application of new technology has been a key part of how living standards have improved over the last few hundred years, and I’m sure most people are hoping for further improvements for themselves and their children/grandchildren. And employment rates seemed to be about as high as they’ve been for decades.
And so I was interested this afternoon flicking through today’s online Financial Times to find an article citing some new OECD work suggestiong that New Zealand is among the advanced countries with some of the lower propotions of jobs at significant risk of automation. Here is the key chart from the OECD paper.
New Zealand fourth lowest share of jobs at high risk of being automated, and lowest in the OECD for the combined high and significant risks.
For the geeks, here is some text from the paper on how OECD researchers have been revising down their estimates.
Automation will, no doubt, continue to happen. It should. We’ll generally be better off for it (even if some individuals will face difficult adjustments, as they did in every phase of activity – indeed every business cycle – since the Industrial Revolution). But particularly if this methodology is even approximately right, it reinforces my sense that the Labour Party – and now the government – (probably with good intentions) use the Future of Work issue, and automation risks/possibilities, as a distraction from, and substitute for, their lack of interest/ideas in addressing the real economic elephant in the room: decades of underperforming productivity growth that mean we would now need a two-thirds lift in productivity (all else equal) to once again match the leading countries, most of whom we used to consistently outstrip.
As Morning Report reminded us today on the anniversary of women’s suffrage, we should celebrate the automatic washing machine, for all the time it freed up, and opportunities it allowed people (then largely women) to pursue. It is only one of a myriad of such innnovations, past, present and future.
But New Zealanders get fewer of the gains than most advanced country citizens, as successive governments have done nothing to reverse the productivity failure.