The Norman Transcript

January 24, 2013

Recession, tech kill middle-class jobs

By Bernard Condon and Paul Wiseman
The Associated Press

NEW YORK — Five years after the start of the Great Recession, the toll is terrifyingly clear: Millions of middle-class jobs have been lost in developed countries the world over.

And the situation is even worse than it appears.

Most of the jobs will never return, and millions more are likely to vanish as well, say experts who study the labor market. What’s more, increasingly, jobs are disappearing in the service sector, home to two-thirds of all workers. They’re being obliterated by technology.

Year after year, the software that runs computers and an array of other machines and devices becomes more sophisticated and powerful and capable of doing tasks more efficiently.

“The jobs that are going away aren’t coming back,” said Andrew McAfee, principal research scientist at the Center for Digital Business at the Massachusetts Institute of Technology and co-author of “Race Against the Machine.” “’I have never seen a period where computers demonstrated as many skills and abilities as they have over the past seven years.”

The global economy is being reshaped by machines that generate and analyze vast amounts of data; by devices such as smartphones and tablet computers that let people work just about anywhere; by smarter, nimbler robots; and by services that let businesses rent computing power when they need it. Whole employment categories, from secretaries to travel agents, are starting to disappear.

“There’s no sector of the economy that’s going to get a pass,” said Martin Ford, who runs a software company and wrote “The Lights in the Tunnel,” a book predicting widespread job losses.

The numbers startle even labor economists. In the United States, half the 7.5 million jobs lost during the Great Recession were in industries that pay middle-class wages, ranging from $38,000 to $68,000. But only 2 percent of the 3.5 million jobs gained since the recession ended in June 2009 are in midpay industries. Nearly 70 percent are in low-paying industries and 29 percent in industries that pay well.

In the 17 European countries that use the euro as their currency, the numbers are even worse. Almost 4.3 million low-paying jobs have been gained since mid-2009, but the loss of mid-paying jobs has never stopped. A total of 7.6 million disappeared from January 2008 through last June.

Experts warn that this “hollowing out” of the middle-class work force is far from over. They predict the loss of millions more jobs as technology becomes even more sophisticated. Maarten Goos, an economist at the University of Leuven in Belgium, said Europe could double its middle-class job losses.

Some occupations are beneficiaries of the march of technology, such as software engineers and app designers for smartphones and tablet computers. Overall, though, technology is eliminating far more jobs than it is creating.

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