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1. Automation and a Changing Economy: Policies for Shared Prosperity

Author:
Alastair Fitzpayne, Conor Mckay, and Ethan Pollack
Publication Date:
04-2019
Content Type:
Working Paper
Institution:
Aspen Institute
Abstract:
Part I of this report, Automation and a Changing Economy: The Case for Action, explores how automation has impacted and will continue to impact the economic security and opportunity of the American worker. But technology is not destiny. The impact of innovation on the American worker is mediated by policies and institutions. We can choose to create an economy that: promotes technological progress; prepares workers to take advantage of the opportunities technology presents; supports those who are negatively impacted by automation return to stable work; and shares technology’s gains more broadly. These goals are achievable with the right support, but the policy structures currently in place are inadequate. This part of the report, Automation and a Changing Economy: Policies for Shared Prosperity, outlines a policy agenda for addressing these challenges and opportunities. Doing so requires an all-of-the-above approach, from targeted, specialized interventions to those with systems-level impact; from place-based policies to national-level reforms to safety net programs. The paper identifies four objectives that guide its recommendations
Topic:
Science and Technology, Labor Issues, Automation, and Job Creation
Political Geography:
Global Focus

2. Automation and a Changing Economy: The Case for Action

Author:
Alastair Fitzpayne, Conor Mckay, and Ethan Pollack
Publication Date:
04-2019
Content Type:
Working Paper
Institution:
Aspen Institute
Abstract:
Technology fuels our economy, captures our collective imaginations, and promises extraordinary possibilities. It permeates almost all aspects of our lives. From electrification and the internal combustion engine, to search engines and smartphones, technology has changed how we travel, access information, buy products, and communicate with each other. As technology changes our personal lives, it also changes work. For generations, economic change has replaced products, jobs, and industries with innovative new models. The American economy has transitioned from agrarian to industrial, service to digital, and with each evolution, America has prospered even as it grappled with the profound challenges of change. The American ideal embraces the promise that economic progress can create an inclusive society in which prosperity is broadly shared. Work is more than simply a way to earn a living. It gives structure, dignity, and purpose to our lives. For this reason, workers should not be treated as a cost of doing business but recognized for their productivity and creativity. For too many Americans, the promise of work is not being kept. New technologies are creating great wealth for some, but we are simultaneously experiencing historic income and wealth inequality. Without robust policies and strong institutions, new innovations risk exacerbating the economic insecurity and political and civil divides that we are experiencing today. Emerging technologies, including artificial intelligence, machine learning, and advanced robotics, have the potential to automate many tasks currently performed by workers. Historically, automation has been an important ingredient driving economic growth and progress. Automation has enabled us to feed a growing population while allowing workers to transition from subsistence farming to new forms of work. Automation helped move us from a craft system to mass production, from blue-collar to white-collar to “new-collar” work—with better work, higher wages, more jobs, and better living standards. Similar to past innovations, these new technologies offer the potential to help us meet human needs while supporting new jobs and industries never before imagined. However, automation can also have negative effects on individuals and communities. Those who lose their jobs suffer economic, social, and psychological hardship. Communities that relied on single industries that have been automated have struggled to recover. New jobs are being created, but their geographic distribution and skill requirements often make them inaccessible to the individuals and the communities where those whose jobs were lost. This dislocation has played a role in exacerbating America’s economic, political, geographic, and social divides. The answer to the dislocations that can result from automation should not be to stifle innovation. Policies and reforms should encourage both the development of new technologies and the promise of work. Workers need access to the opportunities technology creates. Policymakers and employers can help by providing access to skills training, ensuring the availability of good jobs, and improving the systems that are in place to help those who will transition from declining to growing occupations. While there are many unanswered questions about what the future holds, this report attempts to explain how automation impacts the labor market and how to better prepare American workers to benefit from the changes to come.
Topic:
Economics, Science and Technology, Labor Issues, Automation, and Job Creation
Political Geography:
Global Focus

3. Worker Training Tax Credit: Promoting Employer Investments in the Workforce

Author:
Alastair Fitzpayne and Ethan Pollack
Publication Date:
08-2018
Content Type:
Working Paper
Institution:
Aspen Institute
Abstract:
Rapid advances in technology, including artificial intelligence and automation, are transforming industries and reshaping the skills necessary to secure and keep a job. In response, U.S. workers will need to acquire skills that are not easily automated or that complement ever-changing technology. Yet, data suggest an alarming trend: there is a steady decline in the amount employers are investing in their workforce.[1] Federal and state policymakers should consider using tax incentives to encourage additional workforce training investments. To accomplish this, in May 2017 the Future of Work Initiative proposed the Worker Training Tax Credit. Modeled on the popular Research and Development (R&D) Tax Credit, this new tax credit could be used by small and large businesses to invest in training for their low- and middle-income workers. Based on economic modeling recently conducted by District Economics Group, the Worker Training Tax Credit would cost roughly $146.5 million over ten years, and lead businesses to increase training investments by 8.5 percent. Because the tax credit excludes training provided to high-income workers, these induced training investments would provide greater opportunity to low- and middle-income workers.
Topic:
Science and Technology, Employment, Tax Systems, Artificial Intelligence, and Skilled Labor
Political Geography:
North America and United States of America