"Most small companies require far fewer accountants and bookkeepers than they used to, or those personnel can do additional tasks because so much time has been freed up."

I don't see increased automation and tech as a problem, the problem is that productivity increases have not resulted in increased income for the people who still have jobs.

For decades after the Great Depression, workers making more were able to command higher wages. Then, their increased demand for goods would cause companies to hire the newly unemployed to make stuff for the newly richer workers.

I don't see how you're responsible in any way for the de-coupling of productivity from compensation, which is what's troubling, not increased tech.

how society, a large one like ours, would organise itself if manual labour of all sorts was no longer needed. If we had machines to do every single job that currently earns a salary. Resources would of course still remain limited. How would we aportion out the goods.

As for you, I shouldn't worry too much. I'm quite sure you were a benefit to "society". To the individuals whos jobs you destroyed you could have been either. I'm sure plenty did very well out of the enforced change. 

but not because you work to help businesses automate. 

There are a couple of logical ways to think about this. One is why automate? Cui bono? Businesses automate in order to carry fewer employees & cut costs in order to increase profits and/or offer lower prices to the public. In other words, they can produce the same inventory at lower cost. But if 2 paper pusher employees lose their jobs every time Hank lands a contract, that should mean that in aggregate, automation should eventually produce enough unemployment so that even the tremendous savings from the use of computers is eventually offset by lowered sales.

Assuming no other changes to the economy, you'd expect to see a rise in unemployment followed by a drop in inventories. But that isn't what you see. Instead, you find unemployment & inventories basically following the ups & downs of the business cycle, much as they had before Hank started installing his infernal machines.

Overall, unemployment has been if anything edging downward since 1980. You can see the big spike in 1983, when Hank first went into business and knocked millions out of work. But the freed up labor created plenty of new opportunities, and soon the paper pushers began finding new careers. Businesses were able to produce more for the same work, which means people were free to do other kinds of work. This is how GDP increases.

However, as catchy points out, GDP increases have increasingly been siphoned up by the owners of capital. Real wages have stagnated while capital gains have climbed spectacularly over the past 3 decades. Now because wages are a matter of negotiation, this major change in the way GDP is distributed must have come about because of a failure of negotiating leverage on the part of wage employees. Their negotiating position has been undercut vis a vis management. My theory is that the #1 source of pressure on wages has been the increasing availability of ultra-cheap offshore labor. Capital owners can tell union reps, or individual employees to go take a hike much more readily when there are such attractive savings to be had in SE Asia and the like. 

They're keeping the money because nobody, not unions, not government, and not US citizen employees has the leverage to demand a greater share of production gains. It's as simple as that.

Of course, automation & standardization have played a key role in making offshoring possible in the first place. But it's the large difference in labor costs between first world & developing countries that is the real problem.

I don't think I've been responsible for as many jobs as you, but certainly a few dozen on the low end.

I've never actually seen anybody fired though. It's been more like I walk into a place where people are overworked, so the company needs to automate something or hire more people. Or, in another case, such as one I am working on now, a company will save about $5,000 per month in printing costs. That's a good thing. Less paper and energy used to do the same work. But it will probably cost a job from their printing service contractor, though I will never be made aware of that.

I think off-shoring has been far more damaging than automation. If you look at the numbers, old jobs have been lost to technology but new ones created. There are armies of coders and IT guys now. People enjoy services that did not exist previously, like this blog, cell phones, mapping, and so on. This has been a pattern through all of industrialization. New technology, new products, new jobs.

What is new is the off-shoring. Many of those coders are based in India. And not just coders, accounting staff as well. Call center workers by the thousands work 24x7 in the Philippines. And the big one, manufacturing labor in China. Half a million for just one company, Foxconn, and it has thousands of Asian suppliers.

All that said, automation is a key enabler of off-shoring, unfortunately. So if there is one area where tech people can be blamed, is in creating the tools that allow companies to ship so many jobs overseas.

But in your case, Hank, I'm guessing you are helping these small companies survive. Because if they don't increase productivity, they cannot remain viable, and their work could be done elsewhere, even abroad. A better way to approach this problem is to study the alternatives such as they are in the real world.

I don't mean you should use the old executioner's excuse that if not you, then some other Hank would have done the same thing. I mean, work out what would have happened to a company with no Hank at all.

If you're having some Catholic flashback I suggest doing without whiskey as atonement.  No sense letting it go to waste, you can send it to the Church of St Darth and probably write it off. 

Father Cuddly: Bless you my son.  I thank you for the grains and the spirit in which they were given.

Look at the upside.  There a whole bunch of IT guys that have jobs deleting movies and pr)n off of network drives, none of which could be possible without you.

You provide a service to computer illiterate small-biz people, so you're probably safe... but on the corporate side, IT departments are getting hurt. Basically, it's the cloud revolution making in-house customized IT solutions obsolete.

Freeing people from drudgery is a benefit. That the benefit is realized in terms of extra profit for some and unemployment for others is the problem, and that's a social issue.

Perhaps you could comment on the much vaunted (in some circles) prospects for 3D printing. Some say what it will do for manufacturing will be analogous to what digital has done for text, audio and video - essentially eliminating production and distribution costs.

That trio of gold bricking gossipers clearly had their eventual redundancy coming to them.

mmghosh wrote something here about unemployment a few weeks back, something about a communist economist. I searched around and came up with some interesting studies.

Here's a summary of some research done in Germany. The economist F. Vester tracked the number of jobs created by an investment of DM1,000,000,000 in industrial plant over 30 years.
1955-60 a billion DM created 2,000,000 jobs
1960-65 a billion DM created 400,000 jobs
1965-70 a billion DM DESTROYED 100,000 jobs
1970-75 a billion DM DESTROYED 500,000 jobs

That was in capitalist West Germany. The same economist did a study on Saxony, communist East Germany's industrial heartland. In 2004, investment of 14.1 Billion Euro in Saxony's 300 odd chemical manufacturers modernized and brought the region's chemical production back up to equal that of 1989 levels. All fine and dandy. The hitch though, is that the 2004 levels of employment were one tenth the levels
of 1989.

The problem is the more we grow our economy, the more we invest, the more jobs we lose and the higher the rate of unemployment. What sustained our economy in the past - capital investment, increased productivity, automation, and modern management techniques - now seems to have a destructive impact on jobs. If these studies have any value to our situation in general, they suggest we need a rethink on employment and industrial policy. I don't hear anything vaguely like this.

I have a friend who has an engineering degree, worked for a while in the field and gave it up. "Engineering these days is about how to destroy jobs," he told me.

Help destroy jobs.  If I find a way to make a stored procedure a little bit faster by tweaking an index or finding old, decrepit code that is in need of a refactoring effort, the amount of time saved by my work can certainly be greater than a man-year of efficiency improvements.

As others have said, we improve productivity, which should be the ultimate goal of any enterprise: doing more with less.

Yes, some folks are on the short end of the stick as we replace adding machines and typewriters, but such is the nature of progress.  The people who no longer have relevant skills ought to be given retraining assistance on the taxpayer's dime.  Yes, we eliminated their inefficient job, but it was not any of their fault, so time to give them a hand as a hand will be given to us when our skills are outmoded and useless.

Automation has been going for over 30 years, yet job growth has continued. It'd be like you saying that you destroyed the jobs of buggy-whip makers because you built cars. What you have actually done is contribute to American productivity, which ranks pretty high. Faulty premise, faulty thinking.

It is what it is. 

Jobs are destroyed all the time. And jobs don't get destroyed unless there's a reason. 

And I also believe that you know the answer as well. I think when people who let wonderful examples like yours inform their economic thinking, things become clear and we avoid sophistry. People like Bastiat argued this 150 years ago. It's as true now as it was then. What's also true is that the resistance to change and adaptation through misguided thinking was as strong then as it is now. No generation or epoch is exceptional in this regard. Whether it was the village blacksmith or shoemaker of long ago or the more recent displacement of the milkman or iceman or elevator operator, it all happens for a good reason and we move on. New tasks and areas of value are always being creating. 

...fellow job-destroyer!  Bravo!  (I could toss out "creative destruction", productivity improvements as the only plausible way to increase per capita income over the long-haul, etc, but in the end, it hardly matters.  As John says, it is what it is, whether anybody in particular likes it or not.  Ned Ludd's namesakes lost.  They always lose.)