Wednesday, July 11, 2018

Driverless Vehicles and Driving Jobs: Our Third Annual Forecast


Many factors in the self-driving industry have happened as I anticipated.  Consortia have formed, solidified, and dissolved.  Lawsuits have popped up.  A great bull market for technicians and managers with top knowledge has materialized.  And technical progress, along with investment and business effort, has marched forward.  So, when looking at updating our employment and technology-saturation projections, what less-expected events from the past year need to be incorporated?

First, the crashes, especially the fatal one, received more negative reaction than I would have thought.  They were not that disturbing, given the extreme situation with the pedestrian in the dark and most others owing little or nothing to the vehicle’s driverlessness.  Yet it was worthwhile for companies to see how people would react, as they were certain to occur sometime.

Second, Uber, with its business recklessness, has muddied the autonomous waters.  The Arizona crash was just one example of why it does not seem to have enough due diligence for this field, and it is too easy for people to conflate its mistakes with the work of far more reliable firms. 

Third, it is possible, though it is hard for me to assess from outside the field, that technical progress has been a shade slower than estimated.

Fourth, already have emerged some super-strong players, particularly Waymo and Aptiv.  They could still end up Stanley Steamers to someone else’s Toyotas, but the chances are edging down.

Fifth, remote human control, which two years ago I made a stage of my own set of automation levels, is now getting press mention.  In the National Highway Traffic Safety Administration’s Society of Automotive Engineers scheme, which I continue to use as below, it would fit in well as an option for level 4, or high but not full automation, or near the end of level 3, which still requires a driver to be available.

Sixth, publicity, toward understandings of how many kinds of autonomous vehicles and their interiors there will be and on how wide a range of life-changing possibilities they will end up having, has started.  Fall’s New York Times magazine section was especially effective. 

Seventh, it now looks likely that there will be real regional differences in driverless-vehicle acceptance within the United States.  That will be a phase lasting as long as ten years and will for that time cut into overall proliferation acceptances.

Eighth, some other countries, particularly Russia and China, have done their own autonomous research and development, but their closed communication styles and lack of vetted progress make it difficult to consider their efforts world-class.
With all these things considered, here are our new projections:


For definitions of the levels, see the original NHSTA document at http://www.techrepublic.com/article/autonomous-driving-levels-0-to-5-understanding-the-differences/

Stay with the Work’s New Age blog for at least quarterly updates on the progress of driverless vehicles and its effect on jobs.  We will publish our fourth forecast next summer.

Friday, July 6, 2018

Here Comes the Latent Demand for Employment: With June’s Data, AJSN Jumps 980,000 to 16.9 Million


This was quite a Bureau of Labor Statistics jobs report this morning.  It wasn’t clearly bad, but in some ways the brakes of ever-better reports slammed on.  

With 213,000 net new nonfarm payroll positions, we exceeded the publicized projections of 180,000 and 200,000.  However, people hoping for a new unemployment-rate low were beyond disappointed, as the marquee seasonally-adjusted figure jumped 0.2% to 4.0% and the unadjusted rate, reflecting more than the considerable usual difference between May and June, soared from 3.6% to 4.2%.  Those officially jobless for 27 weeks or longer went from 1.2 million to 1.5 million, a huge amount for one good-times month, and the two measures best showing how common it is for Americans to be working, the labor force participation rate and the employment-population ratio, split excellent and neutral outcomes, with the former up 0.2% to 62.9% and the latter holding at 60.4%.  Private nonfarm payroll wages disappointed as well, with a below-inflation 5 cent hourly gain to $26.98.

The American Job Shortage Number or AJSN, the metric showing concisely how many more positions could be quickly filled if people consistently knew they were very easy to get, gained almost one million – a great deal, even with employment regularly dropping from the first month to the second – as follows:


Compared with May, essentially the entire difference came from official joblessness’s rise from 5.76 million.  The second largest contributor was from those wanting work but not looking for it for 12 months or longer, which added 188,000 to the AJSN, and nothing else was significant.  Part of these gains in latent demand were offset by another large drop in those claiming no interest in jobs, down 1.3 million, and those temporarily unavailable, which fell 259,000.  The share of the AJSN from unemployment sharply reversed its recent course, from 32.5% in May to 36.2% here.

It is clear to see much of what happened.  The deservedly well-publicized improvement in available work drew in people in categories some might think reflected permanent disinclinations, mostly those saying they did not want a job at all, which has now fallen 2.3 million since April.  That is why so much of American employment demand is latent – when people hold out hope, their interest picks up, and they move to categories with higher likelihoods of working.  That is also one reason why our prosperity is more tenuous than it looks, and why we cannot ignore these almost 17 million.  If we have a recession, which with the trade war now underway has become more likely, the count of those claiming they will not work will go way over 90 million, but their inherent awareness will not vanish.  In the meantime, while it may not be repeated next month, the turtle, thinking of those 213,000 net new positions and labor-force participation increase, did take a rather modest forward step.

Thursday, June 28, 2018

Autonomous Vehicles: The Past Three Months


In less than two weeks I will post my current projected numbers of taxi and truck driving jobs, with expected driverless car saturation dates.  To clear the way, here is what has happened since mid-March.

Is it possible to incapacitate an autonomous vehicle with only a bag of flour?  Derrick Rossignol, writing in Nerdist.com (“Trapping a Self-Driving Car is Surprisingly Easy”) on March 21st, shows how it just might be.  Required is a solid white circle made around the car, with a dotted-line circle just outside it.  
That emphasizes possible problems with software inflexibility, and reminds me of the words of one of my mid-1980s technical school teachers: “debugging never stops.”

For anyone who might have doubted it, autonomous mobility does not preclude accidents caused by others, with one well described in “Google self-driving van involved in crash in Arizona, driver injured” (Elizabeth Weise and Adrian Marsh, USA Today, May 4th).  Here “a car being driven by a human swerved to avoid another human-driven car and crashed into it.”  The van’s driverless status contributed zero percent. 

Better, though, you don’t agree with that blame assessment than, per “NASA and Uber are getting serious about flying cars” (Fox News, May 11th), trust the latter company with your safety in a tiny craft up in the air.  However, as Kirsten Korosec put it in the May 22nd Yahoo Finance “Consumer Trust in Self-Driving Car Technology Has Made a Sudden U-Turn,” people may be losing confidence in autonomous technology in general, with research finding that the April share of “U.S. drivers… afraid to ride in a fully self-driving vehicle” was 73%.  That may be up a bit since the deadly March accident, though with its changed wording and framing of the question in the immediate present it should not be discouraging.  We also saw that “Uber ends self-driving program in Arizona after fatal crash” (Michael Liedtke, Fox Business, May 24th), a strange decision even for them – what’s the matter with that state, which otherwise has led the way in embracing this technology, in particular?

So what do driverless cars need to achieve to be generally accepted?  Last week I alluded to one answer, per Risk Analysis research, that “Study:  Self-Driving Vehicles Must Be 4 times as Safe as Human Drivers” (Alexa Lardieri, U.S. News & World Report, May 31st).  Per the article, “autonomous vehicles present their own set of risks, making a “perfectly safe” self-driving vehicle “both technologically and economically infeasible,” but the level named is both reasonable and attainable – not to mention one at which almost 30,000 American lives per year would be saved.  A fine working objective. 

I’m not sure I agree that “Self-Driving Cars Likely Won’t Steal Your Job (Until 2040),” (Aarian Marshall, Wired, June 13th), but that’s what a “new report” from Securing America’s Future Energy pointed to, and it’s in the ballpark.  Points Marshall made were that “robo-cars won’t disappear the jobs all at once,” but that “it’s time to prep for fewer truckers and cab drivers, right now,” and, conservatively it seems to me, “the economists estimate (driverless technology) might reduce crash costs by $118 billion annually by 2050.”  It’s fitting, then, that the long-time most safety-oriented carmaker has become the first to announce, though perforce tentatively, “Volvo’s 2021 autopilot to lets (sic) drivers eat, sleep and work” (Chris Mills, New York Post, June 25th), the first production Level 4, per the Society of Automotive Engineers and the National Highway Traffic Safety Administration “capable of performing all driving functions under certain conditions” and in which “the driver may have the option to control the vehicle.”  Will they deliver?

We end with two Motley Fool pieces, “Driverless Tech Will Impact These 5 Industries” (Jeremy Bowman, June 11th) and “3 Top Driverless Car Stocks” (Chris Neiger, June 20th.)  I take seriously this company’s recommendations for investment, especially for general information, since the Watergate logic of following the money, and the effort and true progress behind it, well clarifies situations rife with vaporware and overrepresentations.  As often, both pieces are rich with supporting commentary and information; these two printed out to 15 and 14 pages and do not waste that length.  The business areas Bowman identified – auto manufacturers themselves, auto insurance, ridesharing and taxis, gas stations and convenience stores, and hotels and airlines – hardly form an exhaustive list, but are the largest and most obvious from analysis.  He thought that the first and third will prosper in new ways, and the other three might take a beating.  Neiger’s three stocks were General Motors, Alphabet, and Aptiv – an automaker and two gunrunners.  They also are high-quality choices, though nobody knows if they will even make it, let alone be the best. 

For the July 11th issue, I look at what major things have changed the path of the autonomous-vehicle industry in the past year – along with the estimates above. 


Thursday, June 21, 2018

Simple Answers to Perpetual Questions


Why, despite money supply numbers going well up year after year, is there so little inflation?  Because money, instead of circulating, is pooling up in the largest corporations and many individuals.  That is one result of more and more products being scalable, or one copy costing barely more for a million than for one.  That is the same reason that precious metal, and base metal for that matter, prices are going nowhere – it doesn’t matter how much money is out there if it’s going nowhere.

Why are wages not increasing, despite lower and lower unemployment?  Because latent demand for jobs is still way high – per the American Job Shortage Number (AJSN), we could easily fill 15.9 million new positions, if all knew that getting one was as easy as getting a pizza.  That is also why stories claiming that we are on the verge of a worker shortage, what with all the baby boomers retiring and so on, are wrong – two-thirds of the people who would materialize to fill open positions are not officially jobless.

Why is nationwide productivity falling?  Because disappearing work opportunities are now most likely to be at the high end, with many menial positions resistant to both globalization and automation.  Stock market analysis can be done much better by automata than janitorial tasks. 

Why are driverless car crashes precipitating strong negative reactions while the over 30,000 fatal human-caused ones in this country alone are ignored?  Because people are afraid of change, afraid of the unknown, and afraid of gigantic technology shifts.  Those things attract inordinate fear at best and conspiracy theories at worst.  Not to worry, though, as the level of safety that studies show autonomous vehicles will need for reasonably full acceptance – one-fourth the fatal accident rate of human-driven ones – is well within what will be achieved within the next ten years.

Why are Americans still getting jobs in the information technology field?  Because no courageous large company has led the way with hiring far-cheaper Indians or Russians.  When a Google or Microsoft does that, such positions will quickly disappear from the “Best Jobs of 20xx” lists.

Why do so many people support protectionism?  They don’t, but a few key ones in power seem to feel that way.  We will all pay the price, with many more jobs lost due to higher prices than artificially retained by tariffs, and a lower standard of living nationwide.

Why are 3-D printers not making everything in sight?  Because they are too slow for manufacturing, and they are lacking an application most people can use. 
Why have electric cars not become the norm?  Because, even after 50 years of subsidies and development, recharging needs to be done too often and takes too long, and continuous availability, even if most people don’t truly need it, is highly valued.

How long will it be before the next recession?  Good question.

Thursday, June 14, 2018

The BLS Study: Is the Gig Economy Stalling Out?


This week’s jobs-related news featured some surprising and controversial Bureau of Labor Statistics research on non-payroll employment.  First though, a few items on how this section of the workforce does not need to be.

The first was from the April 30th New York Times, as Noam Scheiber told us that the “Gig Economy Business Model” was “Dealt a Blow in California Ruling.”  That’s not correct, unless those employers never need to “follow minimum-wage and overtime laws and to pay workers’ compensation and unemployment insurance and payroll taxes,” even if, as “industry executives” said, that “tends to cost 20 to 30 percent more.”  Boo hoo!  The second gaffe, by Christina Caron in the same publication on June 12th, “Cheesecake Factory Is Found Partly Liable in $4.6 Million Janitor Wage Theft Case,” was a well-known company apparently thinking that hiring workers as contractors would allow them to forget about required breaks and hold them, presumably without pay, until “kitchen managers conducted walk-throughs to review their work.”  Those offenses weren’t mitigated much by the vice president of legal services saying “we take matters of this nature very seriously.”  Then we have the old vinegar-turned wine of multilevel marketing now surprising the Atlantic in the April 2018 “Beware of Selling Yoga Pants on Facebook,” which called that old shell game “the social-media gig economy.”  Repeat after me:  Online auspices do NOT constitute new business models!  And nothing in this paragraph is inherent to this way of earning money.

So, back to the BLS paper.  It said, per Ben Casselman’s June 7th New York Times “How the Gig Economy Is Reshaping Work:  Not So Much,” that “roughly 10 percent of American workers in 2017 were employed in some form of what the government calls “alternative work arrangements,” a broad category including Uber drivers, freelance writers and people employed through temporary-help agencies,” and which “represents a slight decline from 2005,” also a good economic year.

Several people responded to how this result came about.  First was in this same article, with Casselman writing that “separate data released by the Federal Reserve this month” replaced the 10% with “nearly a third,” a finding echoed by “private-sector studies.”  The BLS study, also per Casselman, did not include those with regular-job equivalents employed by outside agencies, or those “selling products online or working erratically as a freelancer.”  He also quoted a former BLS commissioner saying that “we’re not asking the right questions,” and noted that “income-generating activities that people might not consider “work,” like renting out a home on Airbnb,” were not included.  In “What gig economy?  Fewer working as freelancers, contractors than believed” (Paul Davidson, USA Today, June 7th), we got a Staffing Industry Analysts report result that 29% of the American labor force “performed contingent work in 2015,” and news that the BLS data did not include people with “side hustles” as well as conventional jobs.  That exact phrase also turned up in the headline of Daniel B. Kline’s June 10th Motley Fool piece; “Side hustles are changing how people plan for retirement” related how these additional propositions were on the rise, as I predicted six years ago, and usually undertaken to pay off debt.  That’s nothing new – in decades past they were called “second jobs” – but are facilitated, not dictated, by opportunities using modern technology.

John Younger’s June 11th Forbes “The Death Of The Freelance Revolution Is Greatly Exaggerated” made a different point.  It acknowledged the inferior-good nature of most gig assignments, but mentioned an opposite proposition, “lawyers, doctors and other highly skilled professionals” who “earn as much, on average, as standard employees,” even if they tend to get less in benefits, and of whom “nearly eight in 10 say they prefer being an independent contractor to being an employee,” some of which was also cited by Casselman.  There are likely more of these than there were 13 years ago. 

What can we conclude from this study and those writing about it?  Clearly it missed two-thirds of the data it was supposedly trying to capture.  Working on the side is becoming more common, and may be closer to the spirit of the gig economy than being employed full-time, temporarily, while seeking a W-2 position.  To conclude that fewer, not more, people are earning money through these modern-setting temporary-help propositions, we need more of a breakdown.  And when, not if, the next recession hits, we will all be able to see the value, for many, the gig economy truly has.  

Friday, June 8, 2018

Artificial Intelligence: Our Choices - II


As described in my May 25th post, the development and implementation of artificial intelligence (AI) is growing, expected to be massive, and is bringing numerous old and new issues to the forefront.  What ten observations, attitudes, and adjustments would serve us best?

First, AI evolution will be a process of discovery about us and the world.  What do human beings really want?  Do we truly make decisions of our own volition?  Do we ultimately want more than our own comfort and enjoyment?  If we discover that all objective knowledge stems from algorithms, what will that eventually mean to us?  These questions and many more may someday be answered by progress in this field.

Second, while autonomous vehicles represent the largest single change we anticipate facing in the 21st century, their technology is only a subset of AI, which is like a massive computer system with driverless cars only one of its applications.

Third, accordingly, AI, itself, presents a multicentury-level challenge.  Its significance is hard to overestimate.

Fourth, because of data mining discoveries, some of our core values and wishes, such as the inherent equality of groups of people, may get the most serious nonideological challenges they ever have, and may even be essentially proven false.  If such happens, after and during a long time of denial, large sections of our belief systems will be overturned.  We need to prepare for that. 

Fifth, AI may seem brilliant, but as with other computer applications it is intrinsically totally stupid.  It has no common sense and no idea of what it is doing.  The ancient data processing law of garbage in, garbage out applies with AI as much as it ever has, with bad assumptions or instructions capable of causing totally false conclusions. 

Sixth, while we can debate the dangers of research into artificial general intelligence, it is wrong to try to suppress progress on the narrow version.  As its scope is limited, it will serve us without threatening to take over.

Seventh, we need to avoid hating or attributing conspiracies to AI simply because it is major change.

Eighth, we must think flexibly about AI, and deal with its problems using logic instead of ideology.  It will leave neither conservative nor liberal philosophies unscathed, so we, as individuals as well as collectively, need to consider the values of both sides when assessing and dealing with it.

Ninth, the potential AI-caused mass employment-opportunity elimination means we need to start discussing possible jobs-crisis solutions.  We’re seeing that now with guaranteed basic income, but need more there, along with more serious debate on assured government employment, payments for online content contribution, shorter working hours, and a more widespread use of ad hoc or “gig” jobs.  True, these are mainly solutions for future problems, but we may need one or more of these as soon as the 2020s.

Tenth, on the nonpolitical issue of dealing with artificial intelligence, we need to remember we are Americans and work with those of other backgrounds and beliefs.  For once.  Yet again, our choice is between living together as brothers and perishing together as fools.

Friday, June 1, 2018

May Was Another Fine Employment Month, Though the AJSN Gained 135,000 – We’re Now Short 15.9 Million Jobs


The strength of several, maybe most, of the past year’s Bureau of Labor Statistics Employment Situation Summaries has been debatable.  This morning’s, though, was not.

It started with an official adjusted unemployment rate down again, this time to 3.8%, an 18-year low.  It continued with a drop from 6.3 million to 6.1 million jobless, a 100,000 cut in the number of long-term unemployed (out 27 weeks or longer) to 1.2 million, and a similar decline in those working part-time for economic reasons, or keeping less than full-time work while thus far unsuccessfully seeking that, to 4.9 million.  Even the average private nonfarm payroll wage got in the act by gaining 8 cents per hour, more than inflation, to $26.92.  The unadjusted unemployment rate fell once more, to 3.6%.  The only loser was the labor force participation rate, off 0.1% to 62.7%, offset by the employment-population ratio’s same-amount gain to 60.4%. 

It may seem strange, then, that the American Job Shortage Number or AJSN, the one-figure measure of latent employment demand, increased, in this case 135,000, as follows:


The reason for the gain, though, is easy to understand.  The count of those claiming no interest in working often falls back during strong employment times, and from April it lost almost a million.  The missing people who did not find jobs moved into statuses with higher latent demand rates, most likely not looking for a year or more and temporarily unavailable to take a position.  Gains in those two categories affected the AJSN more than the reduction in unemployment, which, followed by the 5% share of those not wanting work, subtracted the most from the metric. 

Compared with May 2017, the AJSN is down about 800,000.  Almost all of that is from the official jobless drop, with decreases in the sum of those not looking for a year or more and those in institutions, in the services, and off the grid also contributing improvements of over 100,000.  Only the best estimate of the number of American expatriates, up 700,000 over the May-to-May year, raised the AJSN a comparable amount.

As before, there can be little argument that May was a strong American employment month.  What we need to stay aware of, though, is, that with only 32.5% of the AJSN’s value coming from those officially jobless, the first month since before the Great Recession in which it was less than one-third, the massive majority of people likeliest to start working again are not in that category.  Otherwise, the turtle took a solid step forward.