Automation and Unemployment: A Management Viewpoint

Abstract

The relationship between automation and unem ployment is widely misunderstood. More efficient use of la bor through automation and technological advance is the basis of economic growth. It has not meant unemployment in the past, for displaced workers have been absorbed in other and better jobs. Contrary to a common assumption, automation today is not "displacing" workers more rapidly than in the past. Automation has preserved and increased, rather than reduced, Ford employment. We cannot identify any substan tial group of laid-off employees whose unemployment is at tributable solely to automation. Ford employment depends on sales, and there has been no consistent increase in units pro duced per employee. Recovery in auto industry employment after the 1958 recession was limited not by automation but by the market shift toward smaller, simpler, lighter cars which take less work to build. Automation does not lend itself readily to many operations, and it is not likely to advance so rapidly that accommodations cannot be made. Indeed, it will not be easy to maintain the historical rate of productivity in crease. Efforts to explain unemployment as a result of auto mation have done much more to confuse than to advance the search for better solutions to unemployment problems.