Alex Knapp writes that the rapid introduction of robots into China’s economy is going to result in rural and urban workers in China losing “jobs and opportunities.” While cheap robots will indeed eliminate some opportunities, overall Chinese citizens from all economic classes will likely benefit from robot laborers.
There are two broad reasons for using robots in production: (1) the robots can do things that human workers can’t, and (2) the robots are cheaper than human workers. Because China is such an extremely poor country it already has very cheap labor, making it much more likely that companies are using robots for (1) rather than (2).
If you’re going to use robots to replace people then you get the most benefit by replacing people who command relatively high wages. But you can only earn high wages if there’s lots of demand for your labor. Consequently, the type of worker who is most likely to lose his job to robots is the type of worker who has many other job opportunities.
China is an extremely poor country undergoing extraordinarily rapid economic growth. China achieves its high growth in large part by continually moving lots of workers away from inefficient low skilled farming to relatively more productive industrial and service industry work. China’s growth, consequently, is largely due to the destruction of low skilled jobs, and this growth has bestowed tremendous benefits on poor Chinese citizens. And almost certainly the number of Chinese jobs destroyed by factory robots will be trivial compared to the number of agricultural jobs that have already been destroyed by farm machinery and food imports.
Knapp quotes a New York Times article which claimed “It’s hard to believe that hundreds of millions of Chinese can move quickly up the economy’s ‘value chain’ to become tomorrow’s nurses and engineers.” But the easiest way to move up the value chain is to have your neighbors get richer so they will pay more for your production. The new Chinese robots will necessarily be increasing wealth creation in China or they will never be introduced. Much of this wealth will stay in China and will be used to pay for goods and services produced by Chinese workers.
Most of the increase in wealth that has come about since the Industrial Revolution has resulted from the introduction of labor saving/enhancing technologies, and overall these technologies have made all economic classes in industrialized nations much richer. It’s certainly true that this time might be different, but there should be an extremely high burden of proof for anyone claiming so.