Notebook: Real News and Automated Villains
Seligman, Ben B.
The counterattack has started. Purveyors of the conventional wisdom have suddenly launched an all-out assault on all those who over the last few years have called attention to the dark side of...
...A generation ago the mechanic decided himself how to operate a machine tool or to service the equipment...
...Or: "Unemployment is today the infantile paralysis of the economy, striking down teenagers at three times the rate it attacks adults...
...If this is done the picture shapes up somewhat differently: while total employment in manufacturing between 1953 and 1964 was virtually stagnant (an increase of 50,000, to be exact), production workers, those on the factory floor, dropped by 960,000...
...Then what...
...All this, he continues, permits the design of jobs which combine crafts, but the whole process is merely a matter of ordinary improvements worked out by the genius of management...
...After an automated installation has jelled, there is little need for highly skilled personnel: even now high school gradu ates and dropouts are being trained to put reels of tape into computers...
...Not even a few phone calls could turn up a hint of who might have said or written what Drucker says they did...
...is today a form of sleepwalking...
...One supposes that obtuseness must be seen to be believed...
...With increasing automaticity, control over machines is exercised by a machine, measurement is done electronically, and computers can do the data logging...
...They just live in the wrong place: while Negroes live in the city slums, the job opportunities are in the suburbs...
...But that is hardly the point...
...Well, what about Silberman's numbers...
...The other side of the question...
...Drucker might have examined the results of the latest Manpower Research Council poll on automation...
...Last January, within a few days of each other, Look, Fortune, and The New York Times, issued glowing stories on the blessings of the new technology, minimizing at the same time the ominous government and private reports which dared to suggest otherwise...
...The inability to locate the TransfeRobot, one of John Snyder's mechanical manipulators, means that this machine is a myth, says Silberman...
...The second, entitled "The Real News About Automation," is by Charles Silberman, a Fortune editor...
...To Mr...
...When we're through with these calculations, the sum total comes to a deficiency of 3.8 million jobs over an eleven-year period or an average of 345,000 jobs a year to be written off, mainly because of the dramatic alterations in technology...
...Or again: "Labor Department economists believe that we create new jobs at a somewhat higher rate than we did in past periods...
...and printing is being converted from a craft into an industry by phototypesetting and computer techniques that do all the justifying and hyphenation of copy...
...That is, for every one per cent increase in output per man, he deduced a like decrease in jobs...
...But the force of the new technology compels even Silberman to concede that in time computers will control much of American production...
...asks Drucker...
...If by this flimsy straw man he means that absolutely no humans are not to be found in any automated installations as yet, he is right...
...the habit of some to dis miss automation as only a new phase which exaggerates the significance of the current stage of a continuing process...
...But now the combination of the basic oxygen furnace (which replaces on the average five open hearth ovens), continuous casting, and automatic rolling mills has given a considerable boost to process controls...
...Now an engineer lays out the procedure, says Drucker...
...This phenomenon has been job creating, after a fashion: together with the larger consumer market which it has supplied, the vast growth in output, almost 50 per cent in real dollars, has provided the necessary flip...
...What these data imply is an enormous shift of the employed work force out of manufacturing into services...
...It begins with naive exhibition of statistical manipulation and offers with all the excitement of a great discovery a statistic that may very well end all statistics: employment of manufacturing production workers, Silberman says, has increased by one million from 1961 to 1964...
...Am I exaggerating...
...But these were written by other editors (who have just now put all the pieces together in a new book for quick access...
...One simply doesn't set a peak against a trough or vice versa when evaluating trends in employment data: to do so is to commit a statistical howler of no small proportions...
...Look what happens when they come of age and enter adulthood: the jobless rate suddenly drops...
...Indeed...
...He cites the fact that there are at present only 300 process control computers in the U.S...
...is that in terms of particular individuals the casualty lists are beginning to mount to alarming proportions...
...Drucker can prove the proposition...
...But all this means nothing to Drucker, for in his latest oration he places exclusive blame for unemployment squarely on the shoulders of the unemployed...
...But it has not been sufficient, for most of the job advance, according to BLS data, has come in those soft goods lines that have not yet been caught up in the new technology, and in service and government occupations—beauty shops, hospitals, teaching...
...Wirtz knows it better than Drucker...
...Silberman hints also that "real time" data processing, that is obtaining and manipulating data on a computer simultaneously with an event, is a mythologic concoction as well...
...There is nothng else for them to know, since the machine does all the work...
...While this makes the business archon something of a philanthropist, officials in the United Steelworkers Union look with marked trepidation on what these technical developments will do to the work force in that industry...
...After all, it was a prosperous decade for industry...
...Purveyors of the conventional wisdom have suddenly launched an all-out assault on all those who over the last few years have called attention to the dark side of automation...
...He just doesn't think machines will displace people...
...In industry after industry, with varying degrees of speed, mechanization and automation are being employed to substitute machines for men...
...Meanwhile, most of the new entrants into the work force, at the rate of 1.5 million a year, find no jobs or go to work part time at low pay, generally in the service trades...
...And since we do meet often with Labor Department staff, it is correct to say that never have we heard, at least in this writer's fairly long experience, anything quite so nonsensical from a Department spokesman...
...Clerical workers discover methods experts doing the scheduling of work...
...Routine jobs, he asserted, would become a thing of the past, and only technical, maintenance and professional occupations would comprise the work force of the future...
...Manufacturers of process computers expect steel to be an important customer in 1965...
...One of the nation's shrewdest managerial apologists, Drucker once hailed automation as a harbinger of paradise...
...Consider the steel industry, thus far rather laggard in adopting new technical advances...
...Drucker then quotes Secretary of Labor Willard Wirtz to the effect that "Automation creates more jobs than it destroys...
...Indeed it does, if only because employers are more likely to select a 21-year old than a 17-year old...
...For several years now, this fountainhead of business wisdom has been publishing articles on computers, microminiaturization, artificial intelligence, data-processing, systems analysis and other exotic features of the new technology, which have been fairly accurate...
...High level skills have become transferable from one trade to the next...
...Besides, he continues, women are taking all the jobs that used to go to teen-agers...
...Department of Labor, are convinced that we are today liquidating jobs at a lower rate than at most times in the past...
...If he persists in looking for something to which he had given the years of his life, he may very well remain unemployed...
...And so we come finally to Silberman's contention that there are no fully automated processes for any major product in any industry...
...Ralph Helstein, president of the Packinghouse Workers Union, would be ready, I'm sure, to supply the evidence...
...Further, one can always quote Mr...
...Harris, the worker is winning his battle against machines by sheer guts and education...
...Upset by what has been happening, and knowing the nature of the new hardware, they have sought to arouse public awareness with shocking pronouncements...
...Ergo, any assertion that automation destroys jobs is a case of false gloom...
...For example...
...But finally, he concedes, with much reluctance, that "sooner or later" we will have the technical capability to substitute machines for men "in most of the functions men now perform...
...In the durable goods sector, there was even a decline of 69,000 in total employment: further, production jobs went down by 730,000...
...the size of crews on ships are cut in half by automated bridge devices...
...In non-durables, production workers were down 230,000...
...The last time I heard this argument was from a supermarket operator who wanted to hire youngsters at 85 cents an hour...
...I say this since in 1953, when the work force totalled 63 million, unemployment was about 2 per cent, close to the frictional point...
...A decade ago he predicted that the new technology would lead to the greatest advance in upgrading that labor would ever experience...
...The relationship is a good deal more complicated...
...the statement itself suffers so from semantic fever that it is barely rational...
...This represents technology's visible toll, but it is only the official portion...
...and 79 per cent anticipated no gain in the office...
...The only major manufacturing sector within these broad classes in which production jobs increased was fabricated metals—a gain of 6,000 over the entire decade...
...Again: ". . . to say that automation means employment, not unemployment...
...but the Scientific American (October, 1964) describes a number of such devices in use which are programmed to repeat the same transfer operation indefinitely at a constant speed...
...Ready as they were for automation, says he, these industries never took the next step...
...Interestingly enough, Silberman cites Texaco's Port Arthur refinery, which employs several thousand men, to support his argument that humans are still necessary...
...Industries that are adopting the new technology, including the computer, continue to suffer declining employment—steel pipes and tubes, primary aluminum, primary non-ferrous smelting, various kinds of machinery, typewriters and sewing machines are all good examples...
...An ironic note: immediately following Silberman's article, Fortune published one captioned, "The New Glow in Steel Technology," replete with pictures of a new bar mill, a vacuum degassing unit, and a revers ing mill with an automatic monitering system that controls plate thickness, width, length, slab temperature and roll force and which drastically reduces labor requirements...
...Numerical controls operated by computers carve metal pieces with greater precision than a skilled mechanic can...
...Silberman's choice of I961, which was a low point or "trough" in the employment series, serves his purpose quite well, since any upward movement looks good when you start at the bottom...
...If there had been no job gain at all we'd be in a perilous condition, indeed...
...Wirtz against Mr...
...Lest the argument be made that 1953 was a year of over ful employment because of Korea, shift the base to 1956, and one still gets a drop of 340,000 production jobs in manufacturing...
...Perhaps he doesn't know that 10 years ago there were only a handful of process control operations in existence or that in 1965 it is expected another 100 to 125 will be installed or that by 1970 manufacturers expect to have completed 4,000 of them...
...Let us start with the official hard-core unemployment attributable to structural change, approximately 1.3 million persons...
...The likelihood, as we are now discovering, is that the new job, after months of search, is apt to be a poorer one in a repair shop or gasoline station...
...But this hardly means that a displaced auto worker becomes a government clerk: he has neither the training nor the inclination for that sort of occupation...
...the most experienced and most respected labor economists in the country, the professionals in the U.S...
...Unfortunately, by that time the worker—as well as most of us—will be dead...
...Even by Silberman's own arithmetic, tendentious as it is, the recent alleged resurgence in manufacturing still leaves a deficiency of 700,000 jobs, as compared to 1956 (the date one must use when he compares 1961-64 and the previous five years...
...is a selective interpretation of history which develops around a concept of progress measured in terms of automobile horsepower...
...If technology had nothing to do with these substantial changes in manufacturing employment, what did...
...The prospect for high labor skills in the future is not nearly as great as was once anticipated...
...Finally, Drucker, still insisting on his upgrading effect despite all the facts demonstrating otherwise, attributes workers concern over automation to a feeling that craft is being consolidated or even eliminated...
...Furthermore, Silberman evidently doesn't read his own magazine...
...Put somewhat differently, expectations that jobs would decline in the coming half-decade in the respondent's own industries and firms exceeded expectations for increases...
...But if these are products of autistic thinking, there are several other gems in Drucker's piece that need exposing, because they seem related to something that Labor Department experts did say...
...moreover, there is ample evidence to the contrary, and Mr...
...To these souls one must add a million or more workers who have dropped out of the labor force because they got tired looking for jobs and are therefore not counted in the official censuses, and about a million in full time equivalents for those working part time...
...With automation spreading now...
...If he had wanted opinions rather than facts, Mr...
...A recent report on the displacement of factory clerks by computers prepared by the Wisconsin State Employment Service had this to say: "The number of new jobs and positions created by computerization was insignificant in proportion to the number of positions eliminated by the computer...
...Obviously, the kids of America are lazy...
...Industry sources, cited in Business Week, say 400, but no matter...
...Referring to teen-age unemployment, which at 15 per cent is enormous, he says the teen-ager may have priced himself out of the market...
...The disparity between BLS estimates and my own stem from differences in statistical approach: in any case, from a global standpoint, they are close enough...
...A remarkable conclusion, yet what else can he say after realizing that all his jerry-built arguments have collapsed...
...Now, although those of us who are labor union professionals might not share completely Drucker's sudden enthusiasm for the bureaucrat, we do have high regard for our colleagues over in the Labor Building...
...Suppose we shift the base back to 1959...
...I shan't go into Drucker's use of employment statistics: it's the same mishmash into which Silberman dips—an illegitimate use of base years, putting supervisory and production workers into the same bin, assorted non-sequiturs (after talking about man-hours, Drucker drags in take-home pay by the heels), straw men of a more flimsy nature than Silberman's, and citations from the usual anonymous professionals in the Labor Department...
...That the opinions foreseeing more jobs in the nation as a whole (43 per cent) were greater than those predicting an absolute decline (28 per cent, although 29 per cent expected the same level of jobs) merely indicates that most business men hope that other industries and other companies will take up the slack...
...The losses estimated above cover only unemployment beyond the frictional and demand deficiency levels...
...Machines supposedly have nothing to do with such developments...
...could be regarded as technological displacement on the grounds that all changes in the structure of output stem from technological change, since it is the latter which results in substitution of materials and products as well as in new processes...
...78 per cent did not foresee increased production jobs in their own firms...
...Let us see...
...Without this background, it is easy for Silberman to minimize the application of automated controls in such industries as oil refining, chemicals, and paper...
...within their own industries, 70 per cent expressed no such expectations...
...Were these citations the normal "not-to-beattributedto-me" items, or were they just imaginary...
...Among the statistician's bag of tricks is the selective use of a base year: you almost can prove anything you want by choosing the appropriate one...
...Of the first of these extraordinary pieces, by T. G. Harris in Look (January 12) the less said the better...
...Some months ago he asked me where I got all my information on computers and process controls...
...On this Iast point: says Drucker...
...Of course, such argument by authority is fruitless, since neither Mr...
...Yet even these men can be eliminated since the computer is fully capable of recording the data, while the ladder climbing is a form of industrial exercise intended to keep maintenance men busy...
...The outcome appears to be a relatively small gain in employment for highly skilled workers, a market apt to be quickly saturated anyway, counterbalanced by unemployment of the unskilled, who if lucky, can drift into the odds and ends of the service trades...
...Nor does Silberman mention other areas in which employment continues to drop, say, motor vehicles, food processing, or petroleum refining, all major users of the new technology...
...secondly, they were talking about the "disemployment" of workers as a result of technological change...
...Are we then really a long way off from the completely automatic factory, as our Fortune expert asserts...
...The effect is apt to be synergistic, that is, greater than the sum of its parts...
...First of all, the estimate, presented in a paper by Ewan Clague and Leon Greenberg of the Bureau of Labor Statistics in 1962, was 200,000 lost jobs a year...
...And what of Negro youth...
...One of the difficulties in this furor over employment figures stems from the understandable exaggeration of people like John Snyder and others who have claimed that automation detroys 40,000 jobs a week...
...We haven't too far to go to 1970...
...For, as James Bright of Harvard University demonstrated, many of the maintenance and technical jobs are transitory...
...I told him that I carefully read Fortune, among other things...
...However, movements from one year to another generally require comparisons of peaks to peaks or troughs to troughs: at least this is the method employed by the highly regarded and quite careful National Bureau of Eco nomic Research...
...And to deny, as Silberman does, even inferentially, that job loss in meatpacking has any relation to automation is a wilful distortion of fact...
...Of course, he doesn't tell his readers that most of the displacement occurred several years prior to the time he's writing about...
...He then uses his new found number to clobber Donald Michael of the Institute for Policy Studies, the Ad Hoc Committee on the Triple Revolution, Alice Mary Hilton of the Institute for Cybercultural Research, and John I. Snyder, all of whom have been urging that, given the nature of our social system, automation spells trouble...
...Even in a completely automatic power plant there are one or two men around reading dials and a petrochemical factory still has several hundred workers to climb ladders and tap on tubes and do data logging...
...Of course, total employment has increased, but there has also been a virtual explosion in the work force and in population...
...Based on the responses of some 200 corporate executives, MRC's report indicated that 57 per cent of its respondents did not think that automation would increase jobs in the next five years...
...Much more devious is Peter Drucker's article, "Automation Is Not The Villain" in The New York Times Magazine (January 10...
...Yet the facts now indicate Drucker to have been a poor prophet...
...But he does not add the rest of the sentence...
...Here's one: "The Department of Labor economists have come up with a figure of 187,000 manufacturing jobs a year lost during the fifties because of improved productivity . . . with the latter traceable to a variety of causes, not merely technology...
...Unfortunately, their estimates are based on calculations as improper as Silberman's: what Snyder did was to apply the rate of productivity growth of about 3 per cent a year to the work force, thereby assuming an inverse one-to-one correspondence between productivity and employment...
...Technically, the trough-topeak, which measures the bottom-totop spread, indicates the length of one-half a business cycle...
...Wirtz...
...Furthermore, when the Oil and Chemical Union struck the plant a few years ago, production went on unimpeded with all the data logging and dial watching done by supervisors...
...Of course, Drucker doesn't tell his Times readers that there are still 560,000 unemployed between the ages of 20 and 24...
...These decreases, they said...
...process control computer systems not only eliminate the brewmaster's nose but impel precisely the sort of plant layout rearrangements that Drucker asserts stem solely from management skills...
...Yet the peddlers of conventional wisdoms are ever ready in their usual irresponsible manner to convince the working man that he must exercise his patience, for in the long run the corporate archon and his machine will bestow untold blessings upon his grandchildren...
...the proportion of jobs open to new and untrained workers is dropping rapidly...
...Suppose now we shift the base year back still more, to 1953, in any case the proper year to use from a statistical standpoint since it was the previous high for employment...
...Wirtz nor Mr...
...Aside from the curious phenomenon of simultaneous publication and the striking similarity in their tone, one stands aghast at the distortion of fact, the fundamental ignorance of the new technology, the strings of non-sequiturs, the primitive use of ad hominem argument, and the simplistic and archaic conception of the economic forces involved...
Vol. 12 • April 1965 • No. 2
