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Robots are shifting income from workers to owners

Michael Owens' breakthrough bottle-making machine, 1907. The machine displaced glass-blowers. Photo: Science & Society Picture Library / Getty.

In the 19th century, it took six decades after the Luddites for the wages of textile workers to recover from the advent of weaving machines. We are in the midst of another such gap now, according to David Autor, a pioneering labor economist at MIT.

What's happening now: Machines are creating more wealth, but workers are not getting their usual cut of the pie, Autor told Axios.

Quote"Automation is redistributing income from workers to owners."
— Autor

Between the lines: This partly explains why American wages have been largely stagnant despite one of the tightest job markets in decades. And no one knows how long the gap will last — when workers displaced by the new automation revolution will find employment at gainful wages.

The chronology: Blue-collar misery goes back to the 1980s, when such workers began to suffer job, wage and benefit cuts, Autor said. But in the late 1990s or early 2000s, they were hit by a new phenomenon: the divvying up of the total economic pie — steady for decades — suddenly changed, and labor's share dropped, according to a new paper by Autor and co-author Anna Salomons.

  • Autor, who presented the paper last week at the Brookings Institution, said he doesn't know what caused the gap to open.

In a video produced along with the paper, Autor said people are too focused on the potential for jobs to be wiped out. "The concern should not be about the number of jobs," he said, "but whether those are jobs that can support a reasonable standard of living and what set of people have access to them."

  • There are an unprecedented number of "creative, rich, rewarding and well-remunerated jobs," Autor said.
  • But low-skilled jobs are among the most rapidly growing — in personal services, food services, cleaning, security, home health, and so on. These, he said, "are not well-paid, are not stable, and don't offer a very good standard of living."
  • Autor said, "So you could say on the one hand, 'Great we have a lot of jobs.' On the other hand, those are not the jobs we'd most like to have. So I think the concern ought to be about what is the comparative advantage of human labor in an increasingly automated world."
Haley Britzky 17 hours ago
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AI researchers are in high demand, and their salaries prove it

U1208 Lab at Inserm, which studies cognitive sciences and robot-human communication. Photo: BSIP/UIG via Getty Images

The top researcher for a new non-profit lab called OpenAI made more than $1.9 million in 2016, and two other researchers at the company made hundreds of thousands of dollars despite joining in March and June of that year, The New York Times reports.

Why it matters: The lucrative salaries illustrate the growing demand not only for artificial intelligence but also for those who understand the technology behind it. However, as the NYT points out, the trend also poses a major problem for universities and government agencies who need AI expertise, both to train the next generation and to integrate the technology into everyday life.

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Snapchat will allow users to buy products via augmented reality

Photo by Kevork Djansezian/Getty Images

Snapchat is letting users buy products through a new advertisers' augmented reality feature in its app called "Shoppable AR."

Why it matters: It's one of the most sophisticated uses of augmented reality for marketing that's been rolled out to date — and now that people can buy things directly using the tool, it's likely to spur more investment in the technology.