Our robot overlords are coming, but will they be a boon for our economy, or herald its destruction?
Science fiction usually examines how robots could kill us existentially, by calling our uniqueness into question, or literally, by refusing to open the pod bay doors, but economic destruction could be far more efficient and devastating. If we aren't careful about how we integrate robots into our economy, they could end up compromising our entire system--but on the other hand, if we're smart, they could put all our economic concerns to rest once and for all.
Let's examine how robots could affect a number of economic areas, and the broader implications for those effects.
Jobs
The World Economic Forum is predicting what's being called the "Fourth Industrial Revolution," driven by technologies like artificial intelligence, 3D printing, nanobots, genetics, biotechnology, and other robotics areas. By the year 2020, an estimated 5 million jobs are predicted to be replaced by machines. And that's on top of the jobs that have already been taken over by machines; up until this point, most job replacements have been in manual labor and simple tasks, but over the next several years, these replacements will shift toward more intellectually intensive, traditionally "white collar" jobs.
The flip side is that new jobs will be created by increased demand for these technologies--but at a much more modest rate of 2 million jobs. That leaves a shortfall of 3 million jobs in the next 4 years. So what economic implications would that have?
It means fiercer competition for any available human positions, and increased demand in STEM sectors. It's a manageable transition, from a broad economic perspective, but this is only short-term thinking; we're on pace to destroy countless more jobs as we progress to 2030, 2040, and even further out.
There are some broader economic benefits to this job displacement, however. For starters, companies will save money and increase productivity, meaning they'll be able to produce more and charge less (at least hypothetically). A wage shortfall could therefore be better tolerated by working populations.
There are a lot of potential effects here, both positive and negative, so it could go in a number of different directions.
The Stock Market
Our capitalist society is centralized, in many ways, around the stock market, where shares of public companies are freely traded. When stock prices collapse, the broader economy suffers (like in the 2008 financial crisis), and when they rise, the economy rises.
Here's the problem; stock prices change based on the actions of investors, and investors are gradually being replaced with automated trading algorithms. Already, these robotic traders have caused "flash crashes" that disrupt market trading beyond our control; if these algorithms become more commonplace and publicly controlled, they could hypothetically have massive implications for the direction of our economic growth.
Resources
It's also important to note that advances in robotics can (and should) provide us with more resources necessary to live our lives, making it cheaper to exist. Suitably advanced systems could easily harness enough renewable energy from the sun, automatically grow and harvest crops, and possibly even discover better ways to utilize resources. The only potential problem here is withholding these technologies in search of greater profit--which I'll explore momentarily.
Doomsday Scenarios
With this information, I speculate there are three key "doomsday" scenarios in which the rapid advancement of robotics could disrupt our economy.
- Robots replace too many jobs before we can stabilize a jobless economy. First, robots replace so many jobs--before we can prepare for the realities of a "true" jobless economy--that a substantial portion of the country/world is unable to work and make a living wage.
The Hope
Notice a thread of commonality in the three major doomsday scenarios I outlined above; the critical use of the word "before." Each of these scenarios can be averted by recognition and preparatory measures by our top minds (of both robotics and corporate worlds). Already, technological leaders like Elon Musk and Bill Gates are striving to prepare us for the new realities of an AI-filled world; we just have to keep that momentum going faster than our rate of robotics development. There's no scenario for economic collapse that can't be averted by the same minds potentially responsible for unleashing it.