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A perfect storm saved U.S. dockworkers from having technology radically threaten their employment, but the reality is likely to be different for other workers. The International Longshoremen Association (ILA) came precariously close to a strike long enough to shut down the global economy last month, one which would have affected 45,000 dockworkers and halted supply chains around the world. No surprise then that the workers were successful at getting more money for themselves, and some short-term protections against technology that might threaten their employment. The key here, however, is ‘short-term’. The tentative deal buys time to negotiate a new contract and the local union president said it includes language to protect workers from automation.
The reality is that however powerful their union, there is no group of workers that can completely protect themselves from technology changing how their jobs get done and changing the demand for human workers although the changes may come more slowly than many fear.
The dockworkers were looking for more money, but they also wanted an assurance that artificial intelligence would not be used to replace them in any way.
Basic dock work has been mostly done the same way by humans for centuries, although over the past decades automation such as cranes have changed things slightly. But things are now on the cusp of major change. Robots can now load and unload at docks, with the manufacturers touting a wide range of advantages from using them. From lower labour costs through to better accuracy and safer operations, there seems to be a long list of reasons to switch from human workers to robotic ones. From an economics point of view, it seems absurd that an industry would put themselves at a disadvantage by not adopting any technology that could give them a competitive advantage.
The dockworkers are likely to be the exception that proves the rule when it comes to technology. The dockworkers had two huge advantages not enjoyed by the majority of workers. First, the economic chaos from a strike by dockworkers cannot be underestimated. The four-day strike that did occur stopped all container shipping from 36 U.S. ports, which handle about half of all goods shipped to and from the U.S. Had the strike persisted, scores of industries from pharmaceuticals to autos would have been affected and the economic consequences would have been huge. Second, the workers had on their side the fact that they are protected by a large and powerful union. The ILA represents 45,000 workers, and has a long history of successful negotiations.
Other workers are not likely to be as lucky. Even before anyone had heard of artificial intelligence, technology has always been used to get work done more effectively and always there have been concerns about what that might do to workers. In the 1930s, the economist John Maynard Keynes wrote about ‘technological unemployment’ and there were grave concerns that new machines would eliminate the need for workers in factories, farms and everywhere else. As we know, work was transformed instead and both employment and incomes rose for decades, if at an uneven pace.
Looking forward, it is perhaps the unevenness of the AI technological transformation that should concern us. A union like the ILU can make the AI threat go away for some, but other workers, whether they hand out packages of French fries or do computer tabulations in the finance sector, may see their jobs quietly disappear without the fanfare. That said, it is still early days. A 2023 report by Goldman Sachs forecast that breakthroughs in generative artificial intelligence could drive a 7-per-cent (roughly US$7-trillion) increase in global GDP and lift productivity growth by 1.5 percentage points over a decade. That is certainly impressive, but it also does not suggest that there will be a wholesale replacement of human beings with machines.
Historically, the elimination of some jobs by technology has led to the creation of new ones. The concern of the longshoremen is clearly that any new jobs created will not be those for which they are immediately qualified, and almost certainly will not be as well-compensated as their current work. Even if that is true for them, the real question is whether it will be true in a more macro basis, across the economy as a whole. The estimates may not be huge (according to the World Economic Forum, there will be a decline of 14 million jobs globally over the next five years, which is 2 per cent of current employment) but they can seem huge if they include your job.
What ultimately happens to worker demand because of AI will take years to play out as organizations weigh the advantages of using technology as opposed to workers to get work done effectively. As they figure it out, however, they should also take note that there is an immediate cost to their productivity of having a stressed work force that is effectively waiting for a robot to stroll in and tell them that they have been replaced. According to a 2023 survey by the American Psychological Association, 33 per cent of those worried about AI do not feel motivated to do their best and 25 per cent feel they are operating at a lower productivity level. Forty-six per cent of the workers worried about AI say they plan to look for a job over the next year. Certainly better communication for organizations about their plans, and perhaps investment in re-skilling or upskilling would go some way toward reassuring workers that the plan is not to replace them in the short term.
For workers, there is no getting around the fact that the work they do is unlikely to be the same work that is done a generation or even a decade from now. The dockworkers employed today may be able to continue on until retirement, but it remains to be seen whether they will be followed by others doing the same work. That is not necessarily a bad thing if the new jobs reflect the higher productivity of the transformed economy, but to make that happen will take workers being on guard whether that means utilizing unions or having their worth recognized through other means.