Specialization of Labor Our Undoing?

For hundreds of years, the increased specialization of labor drove greater productive capacity and increased efficiency across all sectors of the world economy. Philosophers like Karl Marx noted the potential damage of such a division of duties to man’s soul. But few could have predicted then that the over-specialization of labor could spell financial catastrophe on a massive scale for those married to very specific skill sets.

Surely, people have been aware, even before the electronic age, that industry-specific skills were subject to the overall health of specific industries. But on a large scale, the viability of the largest industries was never questioned. Surely, there will always be a need for agriculture, medicine, manufacturing, etc.

What people failed to see coming was the entrance of technology into the labor market, not only as tools for employees, but often as their replacements. Even in industries robust with health, technology has eliminated the need for many classes of workers. Those with the most specific skill sets have been the hardest hit.

Humans originally sought specific skills to gain comparative advantages to exploit in trade. But, in comparison to machines, humans’ comparative advantage is actually not the performance of specific tasks but instead the ability to make decisions and think flexibly. Machines have displaced people primarily in jobs that can be well defined according to some algorithm, however complex.

Even in the auto industry, where tasks can be extremely complex, advanced robotics is a mainstay of assembly lines. More familiarly, at grocery stores, automated checkout aisles provide a painful reminder of the rapidity with which traditional jobs are becoming obsolete.

In the face of this competition, basic economics dictates that we exploit our comparative advantages: the ability to acquire lots of generalized information, to communicate and to be creative. While scribes are no longer needed (with some exceptions) to engrave music, the world still needs musicians. Machines are replacing employees in manufacturing but have not yet eradicated the need for doctors, lawyers, creative jobs or upper management or sales staff.

The obvious problem here is that this recipe for survival only stands to benefit a small fraction of the population. Our challenge as a society is to figure out how to keep the majority of the population employed and in demand, without becoming an overbearing paternalistic society in which most jobs are created by the government to keep people busy.