Unemployment Rate Due to Impact of Technology

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Table of Contents

Introduction
Articles’ Summary
Textbook Connection
Evaluation and Conclusion
Works Cited

Introduction

Advancements in technology have led to the development of smart machines that have made work easier. Various economic sectors have adopted technology in their routine activities and business transactions. Financial technologies have bolstered the internet and mobile phones’ use for fiscal transactions. Meanwhile, adopting artificial intelligence and other smart systems has led to the automation of business and industrial activities. Although technology has remained relevant to economic growth, increased unemployment is its greatest detriment. Therefore, unemployment is a macroeconomic issue facilitated by technological integration.

Topic Relevance

Technological integration and unemployment is a relevant topic to the academic and corporate world. The topic offers broad socio-economic understanding making it relevant in macroeconomics. Understanding the impact of technology on the unemployment rate helps determine an effective mechanism for automating business and industrial activities without affecting the employees. The topic helps the businesses identify opportunities through technological integration, and help their employees’ career development. Moreover, the topic explores the flipside of the technology by discussing its detriments on employment rate. Furthermore, by understanding how technology leads to unemployement, the workers seek necessary skills and knowledge to become competitive.

Interest in the Public

Unemployment is a socio-economic issue that affects society largely. Increased unemployment rate leads to high crime rates, among other social vices. Consequently, the public must understand the causes of unemployment and how to mitigate them. By understanding the role of technology on unemployment, the public can develop innovative mechanisms to overcome the issue. Moreover, the public will know how to accommodate those who have lost their jobs to technology. Therefore, technological integration and unemployment is a topic of high public interest.

Articles’ Summary

“The Fear of Technology-Driven Unemployment and its Empirical Base”

The article was written by Kerstin Hötte, Melline Somers, and Angelos Theodorakopoulos on10th June 2022, on the VoxEU website. The authors explore the impact of new technologies on human labor. According to the article, human labor is only needed when workers use the technologies (Hötte et al.). The columnists suggest that technology boosts productivity, increasing disposable income and expanding demand-induced employment. The column identified 127 relevant studies with evidence on the technology’s impact on employment. While the column reviews existing literature on the technology’s impact on employment, the authors state that the labor market has been positively influenced.

“Economists Pin More Blame on Tech for Rising Inequality”

The article was written by Steve Lohr on January 11, 2022, in The New York Times. Mr.Lohr suggests that business and industrial automation have widened job disparities. The author alludes to the recent economic research and recommendations against “excessive automation.” While investing in software and machines is profitable, the investments lead to inequality (Lohr). The digitization has led to the job displacement of the workers, especially those without college degrees. Furthermore, the author supports the economists’ argument that computerization has increased the widening gaps in income in the U.S. Mr. Lohr states that, unlike the current generation, the post-war years were golden age since technology forged ahead and workers enjoyed rising income and job opportunities.

“China’s Tech Layoffs Could Become a Self-Inflicted Headache for Xi”

The article by Laura He was published on the CNN Business on March 31, 2022. The author focuses on the impact of technology adoption among Chinese corporations on employment. While the Chinese government states that the country’s unemployment rate is stable, fluctuating between 5% and 5.5%, private surveys show that jobs are being lost in the tech-based industries (He). The author uses big Chinese corporations to illustrate the impact of technology on employment. For instance, he illustrates how JD.Com, Alibaba, and Tencent have dismissed a considerable percentage of their workforce, attracting public attention. According to Laura, the menace is ‘self-inflicted’ since China has embraced technological adoption across its economic sectors. Like China, many developed nations embrace technology, notwithstanding its impact on the labor market.

“Robots: Stealing Our Jobs or Solving Labour Shortages?”

Martin Ford wrote the article on October 2, 2021, on the Guardian News website. The author explores the impact of robots on employment post-COVID-19 pandemic. According to Martin, although the end of the pandemic relieved the economy, it was a nightmare for the employment sector. Many organizations automated and adopted robots to conduct activities normally executed by the workers (Ford). However, the organizations realized that robots execute the activities better than humans. Moreover, computerized systems are costly and error-free. Consequently, the firms are upholding the use of robots, risking the employment of many people.

“Don’t fear AI. It will lead to long-term job growth.”

Mohamed Kande and Sonmez Murat wrote the article on the World Economic Forum on October 26, 2020. The article alludes to the World Economic Forum’s ‘Future of Jobs Report 2020’, which estimates the displacement of 85 million jobs and the creation of 97 million across 26 countries by 2025 (Kande and Sonmez). The authors suggest that although automation has destroyed jobs, it will create more. According to Kande and Sonmez, a similar concern was created during the growth of internet, but it has created million of jobs that contribute to 10% of the U.S. GDP. Therefore, while technology quickly displaces workers, it is likely to have a long-term positive employment impact.

Textbook Connection

Unemployment is a macroeconomic issue that is largely influenced by technological adoption. Automating business activities and digitizing fiscal transactions have led to the displacement of many works. The article by Kerstin Hötte is consistent with the textbook view on the positive impact of technology on business activities (Chiang 221). Moreover, Steve Lohr’s argument that labor inequality, as facilitated by technology integration, bolsters unemployment is consistent with Chiang’s affirmation (Chiang 203). The textbook does not suggest that technology creates more jobs than it destroys, as suggested by Kande and Sonmez. Therefore, the textbook and the articles articulate that technology integration risks the labor market.

Evaluation and Conclusion

The impact of technology on the labor market is relevant to my present and future life. Upon understanding how technology causes unemployment, I am convinced to sharpen my technical skills to avoid future job displacement. Consequently, I am currently enrolled in an online class on business technology. Moreover, I am motivated to work harder and become the few most competitive employees in the labor market in the future. My future career is at risk since new technologies are invented daily. I am obliged to get updated on trending technological skills in the future. As a business manager, the technology will help me dismiss less competitive works and employ those with broad skills and knowledge in business and technology. Therefore, technological integration and unemployment is a relevant topic in my present and future life, and my career as a business manager.

Works Cited

Chiang, Eric. Macroeconomics: Principles for a Changing World. 5th ed., MacMillan, 2020.

Ford, Martin. “Robots: Stealing Our Jobs or Solving Labour Shortages?”The Guardian, Web.

He, Laura. “Analysis: China’s Tech Layoffs Could Become a Self-Inflicted Headache for Xi.”CNN, Web.

Hötte, Kerstin, et al. “The Fear of Technology-Driven Unemployment and Its Empirical Base.”VoxEU.org, Web.

Kande, Mohamed, and Murat Sonmez. “Don’t Fear AI. The Tech Will Lead to Long-Term Job Growth.” World Economic Forum, Web.

Lohr, Steve. “Economists Pin More Blame on Tech for Rising Inequality.”The New York Times, Web.

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