Robots are going to take our jobs. Things are changing faster now than even during the industrial revolution. We have to start planning now because the future of work is changing rapidly.
This episode is not meant to scare you. It’s meant to prepare you for the changing employment landscape. Breaking the looms is not a long-term solution.
The Future of Work
We wrote an article on people’s biggest financial fears, and job automation was one of them. And for a good reason. Oxford University released a report detailing just how dire things are likely to become:
“According to our estimates, about 47 percent of total US employment is at risk. We further provide evidence that wages and educational attainment exhibit a strong negative relationship with an occupation’s probability of computerization.”
One out of every two people will be without work. Even at the height of the Great Depression, the percentage of unemployed Americans was “just” 25%. Imagine an economic scenario that is twice as bad as the Great Depression.
American workers are the third most productive workforce in the world. In 1998, American workers put in 194 billion hours. Fifteen years later, in 2013, our output increased a whopping 42%, and we were not working more hours, it was still 194 billion per year.
I welcome our robot overlords.Tweet This
The first decade of this century was the first in US history that there wasn’t job growth. There should have been ten million jobs created in that time, and there were zero. Why? Technology is now destroying more jobs than it creates.
Get our best money lessons:
Who’s At Risk?
Almost half of the American workforce represents a wide array of careers. Is your’s on the chopping block? There are three significant sectors likely to be impacted first.
Take a look at the map below. It shows the most common job by state and truck driver predominates. Even in states like California where you might think it’s tech related, nope. Truck drivers. There are 3.5 million truckers in the US and 8.7 million jobs related to the industry that don’t involve driving like mechanics and driving instructors. When automated trucking takes over, 6% of the American workforce will be impacted.
How close are we to fully automated cars? Within two decades, there could be 100% autonomous penetration.
The Auto Industry
The auto industry will be walloped by driverless cars. In the pretty near future, people won’t own cars. Young people are already part of that trend. Don’t take our word for it. Those in the auto industry agree.
*GM says self-driving by 2018
*Ford says “true self-driving” by 2021
*Honda says “self-driving on the highway” by 2020
*Toyota says “self-driving on the highway” by 2020
*Renault-Nissan says 2020 for “Autonomous Cars in Urban Conditions” and 2025 for “truly driverless cars.”
*Volvo says “self-driving on the highway” by 2021
*Hyundai says Highway 2020, Urban Driving 2030
*Daimler says “Nearly Fully Autonomous by Early 2020’s.”
*BMW says “fully self-driving possible” by 2021
*Tesla says 2018
This is trouble for the industry. It makes no sense to manufacture dozens of types of cars and trucks if no one is buying them. People will use self-driving ride-sharing services, and those fleets of cars are likely to be just a handful of different types. Kind of like taxis in New York City in the 1990’s, they were almost all Ford Crown Victorias.
Brick and Mortar Retail
US retailers were on pace to close more stores in 2017 than were closed during the Great Recession of 2008. Most of us can guess why. People are shopping online rather than in brick and mortar stores for a variety of reasons.
For some of us, it’s convenience. If you live in an urban area that doesn’t require a car, it’s easier to have 24 rolls of toilet paper delivered to your home from Amazon than it is to lug them home from Duane Reade. And it’s probably cheaper too.
For some people, it’s a matter of better selection. If you live in BFE and like to cook, your local grocery store may not carry the kinds of exotic spices or special Asian noodles you require, but you can get them online.
Even in brick and mortar stores, there are fewer jobs than before. Cashiers and support staff at CVS went from 10-20 people per location to just 2-3. More and more stores are using self-checkouts and ever how much some of us hate them, they aren’t going away.
You might think all this online shopping would make up for the jobs lost at brick and mortar stores, but it doesn’t. The commerce job gains are only 40% of the jobs lost.
Some of the other areas that will feel the impact include fast food, accountants, benefits managers, credit analysts, and those in the insurance industry.
What Can You Do?
Well, this all sucks! What in hell are we going to do? Don’t panic. There are lots of things we can do before we start smashing robots or become organ farms for the Koch brothers. The little bit of silver lining is that most of this will not start to impact us until 2025-30.
That gives you time to plan and position yourself so you’re not among the first wave of those fired or to focus on building financial independence so you can afford to own the robots or don’t need to work at all.
Get Your Shit Sorted
This is all definitely coming so if after all of this time being an LMM listener, you still haven’t sorted out your money situation, get on it! Like, right this second. Pay off your credit card debt, pay off your student loans, start investing, find a side hustle. Now, now, now!
Don’t be a Coal Miner
Coal jobs are not coming back. Never. I don’t care what Trump has told you. They’re gone. They’re horrible and dangerous too so I guess I’ll have to re-read Hillbilly Elegy to remind myself why anyone would cling on so desperately when there are less hazardous alternatives.
The government has tried and tried to retrain coal miners for new careers, and they refuse. So the world moves on without them. Don’t be a coal miner. If you are currently in one of the careers most at threat, start working towards a new career now.
Go back to school (but don’t go into debt to do it), teach yourself to code online, move up in your current career to a position that is out of the danger zone. Don’t just sit pat while the world passes you up.
Diversify Your Income
This is good advice even if you have a career that is not under threat. Everyone is expendable, and most people never see it coming. All of us should have more than one source of income. It doesn’t have to be a ton of money, although it can become that over time. But you do have to have some money coming in that is independent of your regular job.
We have covered this from every angle. Sell things online, do surveys when you’re waiting at the dentist, buy a rental property or REIT’s, babysit, drive for Uber (until the driverless cars take that job). Do something to make money in your free time. The average American watches five hours of TV a day. Take at least a few of those hours and do something to protect your future.
Pick the Right Career
If you are deciding on a career or looking to change jobs, make sure you pick something that is not in danger of being automated. Unsurprisingly, the majority of future work will likely shift towards education. That doesn’t mean you have to be a teacher in the traditional sense of the word.
We prefer the term “educator.” Everyone who works for LMM is an educator. Training the technicians who will repair the robots taking our jobs makes you an educator. Being a yoga instructor makes you an educator.
Becuase you cannot program empathy, careers that require it like nursing and talk therapists are not going to be shunted aside by robots. Dental hygienists either because no one is going to trust a robot to poke around inside their mouths with sharp implements. These are some more jobs that robots won’t be able to pry out of our cold dead hands.
The Robots Will Not Be Getting Off Your Lawn
We don’t mean this episode to imply that automation is bad, merely that it’s inevitable. No matter how loudly you shout from your porch, shaking your cane, this is all going to happen. Now is not a good time to be set in your ways.
Double Negative: An Imperial Stout by Grimm
Back Flipping Robot: From Boston Dynamics
Tool Box: All the best stuff to manage your money.
The Rise of Robots: From Vox
Automation and AI are Destroying Jobs, Not Work: From Quartz
The Rise of Machines: From In a Nutshell