I am always looking for evidence, whether data or anecdotal, about technological unemployment. If it were becoming more of a problem — whether the creative destruction generated by automation was becoming a net jobs loser or depressing wages or creating jobs that too many workers are unprepared for — one would expect to see headlines like this from The New York Times: “Recovery in U.S. Is Lifting Profits, but Not Adding Jobs.” Here’s the money ‘graph:
As a percentage of national income, corporate profits stood at 14.2 percent in the third quarter of 2012, the largest share at any time since 1950, while the portion of income that went to employees was 61.7 percent, near its lowest point since 1966. In recent years, the shift has accelerated during the slow recovery that followed the financial crisis and ensuing recession of 2008 and 2009, said Dean Maki, chief United States economist at Barclays. Corporate earnings have risen at an annualized rate of 20.1 percent since the end of 2008, he said, but disposable income inched ahead by 1.4 percent annually over the same period, after adjusting for inflation. “There hasn’t been a period in the last 50 years where these trends have been so pronounced,” Mr. Maki said.
Strangely, while the story mentions various factors, from offshoring to the sequester to the Fed, it does not mention technology as a factor driving productivity gains. One more thing: Do these statistics argue against corporate tax cuts? They do not, since workers and investors are the ones who pay the price for higher corporate tax rates and systems which encourages the inefficient deployment of capital. But the numbers certainly emphasize the need for education reform (so workers are prepared for higher-skilled jobs), health care reform (so income gains aren’t gobbled up by health inflation), and ideas such as universal 401k plans so worker incomes are less dependent on wages. And it should go without saying that faster economic growth would sure help.