Friday, December 30, 2016

Driverless Cars This Fall: Technology and Business

Beyond the views, what’s been happening with self-driving vehicles over the past several months?

In “A Lesson of Tesla Crashes?  Computer Vision Can’t Do It All Yet” (The New York Times, September 19), Steve Lohr recapped May’s fatal Florida accident, correctly judging that “the man placed too much confidence in Tesla’s self-driving system.”  The issue is that naming it something like “autopilot,” when it is designed only to spell operators for problem-free and probably short times, is asking for trouble, and now, what with the well-publicized state of advancement in the field, is unnecessary.  When more progress is made with technologies such as the one Lohr described, Stanford and Princeton Universities’ ImageNet, and problems such as the connection between Tesla’s driving and braking systems which caused that crash are fixed, drivers will be more able to disengage.

On that same date, in Business Insider’s “Uber’s self-driving cars are impressive – but there’s still a lot we can’t do,” Danielle Muoio described her experience riding in one of Uber’s Pittsburgh test cars, summarizing that they had real problems “simply having to deal with other human drivers on the road.”  As she photographed in action, during her ride the operator needed to take over control when an 18-wheel truck turned right, from the left lane, in front of them.  The Uber test, per Muoio, is also uncovering issues these vehicles have:  with bridges, given the lack of buildings next to them; with snow, since it covers up lane markings and other orientation markers;  and even with trees, which look different enough in summer and winter for the systems to identify specific ones.  On the other hand, these tests are running up miles, and Google’s has, as of October 5th (Wall Street Journal), reached 2,000,000 of them. 

Sunday Review in The New York Times is a good place for issues we should be thinking about, even without solid conclusions, and that perfectly describes Azim Shariff, Iyad Rahwan, and Jean-Francois Bonnefon’s November 3rd “Whose Life Should Your Car Save?”  This was not the first time I or others have mentioned the issue of how driverless cars should be programmed when faced with a choice “between risks to its passengers and risks to a potentially greater number of pedestrians,” but it didn’t need to be.  We learned here that when Science magazine presented the results of people being surveyed on life-or-death scenarios, “a large majority… agreed that cars that impartially minimized overall casualties were more ethical, and were they type they would like to see on the road,” but also that “most people” showed “a strong preference for buying the self-protective one” instead.  That looks like a crime of the 2030s – people illegally modifying their driverless vehicle software to protect themselves first. 

In that same newspaper the next day, Henry Fountain’s “A Slow Ride Toward the Future of Public Transportation” raised some less commonly presented issues.  He mentioned the appearance of driverless buses around Helsinki campuses and factories, and suggested, correctly for once, that self-driving cars would cut auto sales “in cities” – not in the country.  Those, along with a first experimental bus in public territory, use a combination of environment-detecting sensors and an approach described 64 years ago for automating barbers in Kurt Vonnegut’s Player Piano, capturing and replicating the motions of human drivers.  The piece also mentioned a local computer application, Whim, which Finns can now use to not only plan but book transportation, the forms to be determined by the system, by keying in starting point and destination.

On December 13 in Salon, we found that Google’s driverless effort is now named Waymo, and that the company, ever optimistic, officially expects their vehicles to be “commonplace” in four years or less.  That same day, Cecilia Kang in the Times (Cars Talking to One Another?  They Could Under Proposed Safety Rules) suggested something I should have thought of myself, that driverless vehicles routinely broadcast, air-traffic-control style, their location, speed, and direction to each other.  This plan has the backing and involvement of the National Highway Traffic Safety Administration, and, when technical and bureaucratic issues with radio frequencies are resolved, seems a huge favorite to be implemented.

From December 14th to December 21st, covered by the New York Times and the Wall Street Journal, we saw the rise and fall of Uber’s San Francisco self-driving taxi service.  On that first date they announced that it, though only provided by five cars, would be available throughout that entire city.  They tried to sidestep local regulations by claiming they were not autonomous, and indeed each would have two people, a driver and an engineer, in front, but the imprecision of the laws ended up working against them, and, after the California Department of Motor Vehicles cancelled the cars’ registrations, the service was discontinued.  It will come back, though, at another place, most likely within months.

On December 22nd in Salon, Angelo Young told us that Google’s first Waymo vehicle is now planned to be a minivan.  It’s as least as good as any, since, as modern-day station wagons, minivans accommodate a variety of occupants and cargo, and the expected much greater safety of self-driving cars would appeal to the same demographic. 

Fox Business peeked at the stock investment merits of two major driverless players, including Google’s parent company (“How Apple and Alphabet are De-risking their Self-Driving Car Efforts,” December 23rd).  Commentators Dylan Lewis and Daniel Sparks reached the same conclusion that I did months ago, that producing such things is too much for any single firm.  They added properly that, unlike what these companies are accustomed to in the smartphone market, they will not be able to achieve “high-30%” profit margins, and that both would like to minimize the manufacturing they do themselves.  Yet somebody must make them – could they get away with pawning off this tangible product bearing their nameplate on someone else?  We will see.

Finally, two days ago, Brent Snavely mentioned a name not as commonly mentioned in the driverless world as its competitors.  In “Brain in the Trunk:  Ford to unveil next self-driving car” (Detroit Free Press), he says that Henry’s old company is, along with the others, “investing heavily” in the technology, and is focusing farther down the road, “to develop a fully autonomous car that does not require the driver to operate the vehicle.”  I’m not sure this is a good place to try to leapfrog competitors, but what do I know?  They are hoping to do that without any special roadway technology, by reading where they are going through LIDAR and visual sensors.

So how about jobs?  Hang on to your hat – 2017 will be quite a year.  Expect an updated look at how many truck driving, cabdriving, auto sales, and other positions might be lost by when, sometime in the middle of it. 

Friday, December 23, 2016

Driverless Cars This Fall: Regulations and Questions

Another three months has gone by in this almost $1 trillion area of investment and future promise.  What has happened on the government and commentary side?

On September 19th, the U.S. Department of Transportation released its first set of what could be called guidelines on semiautonomous and fully self-driving vehicles.  In an apparent attempt to guide the technology’s progress without putting up roadblocks, this federal agency named 15 points just short of formal laws.  Per Cecilia Kang in The New York Times the next day, they were sharing data on accidents with regulators, defining privacy expectations for drivers, manufacturers getting safety algorithms validated by others, hacking prevention, effective capability to move control back and forth from systems to drivers, ensuring damage to cars from accidents would be no worse than to today’s ordinary meatmobiles, operation education, a technological-improvement certification requirement, preventing dangerously damaged driverless cars from operating before repairs, ability to follow local traffic laws but being able to violate them in order to prevent a crash, attention to the ethical issues of vehicles protecting their occupants or others first, proof of operational testing and validation, ability to respond to normal and abnormal driving situations, assessing the driver’s fitness to take control, and adequate technology validation including simulations, test-track and road testing.  These make up a comprehensive set of areas to be addressed, and, especially when framed as strong suggestions rather than laws, seem truly positive to me, with one exception.  The idea that, as Kang put it, “any software updates or new driverless features must be submitted to the National Highway Traffic Safety Administration,” could be a recipe for bureaucratic backlogs, and, with the developers of these vehicles knowing far more than federal regulators, would be better replaced with something more cooperative, along the lines of corporate technologists making cases to their managements for upgrades or implementations with quick, perhaps emailed, approvals or requests for more information.  Otherwise, government’s attitude toward self-driving capability seems excellent, with President Barack Obama saying, in a Pittsburgh newspaper editorial also that Monday, that such vehicles could save tens of thousands of lives a year, and that the guidelines above were “flexible and designed to evolve with new advances.”  In all, Washington, in contrast with its response to many other things, hit the right notes here.

Two weeks later, the Times editorial staff, in “Ushering in a Safe, Driverless Future,” took a more regulatory and less positive view, saying that self-driving cars would scare people, with “those fears… made all the more real by a fatal crash involving a Tesla Model S that was traveling on autopilot in May.”  Although the piece tipped its hat to the 35,000 auto accident fatalities last year, at which rate there have been over 20,000 since this last driverless one, it said that “automakers and technology companies might resist mandatory rules, but they shouldn’t,” as that would reassure all that “companies are not using them as crash test dummies.”  I was disappointed to see advocacy of stricter standards than what the Department of Transportation seems to intend, and think that the potential for slow regulatory approval could cost many more lives than one in seven months. 

Eleven weeks after the announcement above, Bill McGee’s “Driverless cars for travelers:  More questions than answers” appeared in USA Today.  The December 7th piece presented many queries, mostly answered already as above by the Department of Transportation, but with more emphasis on driver training and how to avoid excessive distraction.  It also brought up enough follow-on issues for an entire speculative book, such as the effect on auto insurance, determination of who or what is responsible for mishaps, taxation impacts, and even what might happen to the travel industry. 

The most negative response I saw, though, was from Jamie Lincoln Kitman, again on the New York Times op-ed page.  December 19th’s “Google Wants Driverless Cars, but Do We?” was a compendium of the worst anyone could say about self-driving technology, ranging from its most doubtful, extreme, and uncommonly touted advantages (lower harmful emissions?  no airbags?), to allegedly required enormous infrastructure improvements, job losses by “millions of truck and taxi drivers,” the idea that it will cause mass transit to go away, and even questioning federal accident statistics.  Some of his concerns have validity, but the piece was strangely one-sided.  It was especially odd to see someone connected with the driving-related press, in this case “the New York bureau chief for Automobile Magazine,” with this attitude.  There is a story behind this article, but unfortunately I don’t know what it is.

Many technical and organizational things have also happened in the past three months – they will be the subject of next week’s post.  In the meantime, you and your family have a great Christmas, Hanukkah, Kwanzaa, or whatever your brand may be! 

Friday, December 16, 2016

The Backlash on Globalization: It’s Real, But What Will Be Put into Law?

It never was one world, and it may be splitting up even more.

The perception that the world might be getting less flat hit the press well before Donald Trump’s unexpected presidential election victory.  On September 6th, Martin Wolf’s Financial Times column “The tide of globalisation is turning” went back to 2008, citing a study showing that “the ratios of world trade to output” had been much the same since that year, with “cross-border financial assets” and direct foreign investment not only leveling off but peaking around then.  He showed in a chart that trade between countries, as a percentage of gross domestic product, went up irregularly but clearly from about 24% in the early 1960s to 59% in the late 2000s, where, after a 2008 to 2010 dip and recovery, it was through at least 2013.

That same day, Robert Reich’s “The reality of free trade deals – they don’t benefit all” appeared in Salon.  Reich pointed out that only 35% thought free trade benefited most Americans, and, although he is an economist, blamed increasing income inequality along with “unraveling” safety nets.

On the Sunday after the election, The New York Times published author and Morgan Stanley global strategist Ruchir Sharma’s “When Borders Close” comparing 2016 to 1914, when the forces underlying the outbreak of World War I “ended an extraordinary four-decade period of rising migration and trade.”  Movement of goods between countries was to fall from 30 percent of world GDP that year to 10% in 1933, three years after the American Smoot-Hawley Tariff Act caused what Sharma described as “a global trade war.”  Per his article and Wolf’s chart, it would be 60 years before intercountry trade matched that 30%.  He also mentioned a rise in protectionist legislation since 2008, and, along with Wolf, named that year as globalization’s high-water mark, and, in step with Reich’s conclusions, noted the increase in income inequality, specifically the share going to the top 1%, as greatly widening during the time of freest trade.  He finished by saying that “deglobalization” has proved itself to be as natural, and as long-lasting, as its opposite.

Adrian Wooldridge, in The Economist’s late-November “Bolshiness is back,” reached similar conclusions, saying that “this golden age is coming to an end” with “the first shots” coming from the political right, those backing Brexit in Great Britain and Trump in the United States.  He implied that we might also have equivalents of Hitler and Mussolini, and also cited higher top-end income concentration.

All of this may well be happening – if the next administration makes it reality.  As credited to Reagan-era journalist Helen Thomas, war makes strange bedfellows, and we have that now.  Concern about income inequality, jobs moving to other countries, accumulation of corporate money overseas, and wishes for trade restrictions, all historically liberal viewpoints, are now being addressed by Republicans.  Yet that could be more of a party shift than an ideological one, when, arguably, the Democrats as represented by Hillary Clinton are now pro-establishment and therefore conservative, and the Republicans at least purport to support common people as Democrats did for so many decades.  That means it should have been no surprise to see Salon, usually well to the left of even the major eastern newspapers, publishing, four days ago, Les Leopold’s “This is how you stop jobs from leaving American soil:  A game plan to fight outsourcing,” containing eight suggestions, ranging from a good use for unions (making lists of companies planning to move jobs out of the US), one bad idea (passing laws to stop outsourcing; the way to do that is through tax penalties), and on to pressuring Trump to take action, protesting, lobbying, and finding ways to “encourage allies to join the fray.”  If they can succeed and our president-elect turns this piece of his campaign rhetoric into reality, we can say that this is how the country is changing.  If not, we may be looking at 1930s Germany, in which Hitler went from speaking strongly and respectfully of workers to instituting the permanent-record Work Book, to make employers “once again the master of the house.”  That would be even worse than protectionism, which benefits the few at the expense of the many.  But I don’t know which it will be, and you don’t either.   

Friday, December 9, 2016

A Six-Month Miscellaneous Jobs Round-Up

Many articles pertinent to American employment reach my desk, and not all of them are on subtopics, such as self-driving cars, Uber-Lyft-Airbnb, robots, or the minimum wage, which can support an entire post.  Still, they are important, and any of their subjects could, as the driverless vehicles did last year, grow into a booming and attention-getting area.

The first, from June 23, is on a subject on which I have written several times, that of a guaranteed citizen’s stipend.  In “Basic Income Revisited” (Project Syndicate, June 23), Robert Skidelsky, a British emeritus political economy professor, doesn’t revisit as much as introduce it, naming ever-increasing inequality from automation as a possible future cause, saying that “unless we change our system of income generation, there will be no way to check the concentration of wealth in the hands of the rich and exceptionally entrepreneurial.”  As we will see, he’s hardly the only observer seeing that.  I maintain that the perceived problem with inequality, which indeed will not go away by normal means, is actually one of insufficient resources for ordinary people, which can be resolved in a variety of ways, including guaranteed income.

In Forbes, George Anders, a grade-school friend of mine many decades ago who, like me, loved chemistry but ended up in business instead, wrote July 26th’s “Is Tech Killing U.S. Jobs?  The Actual Data Is Surprising.”  He correctly pointed out that relatively few people even now are employed in information technology, but that many more have jobs connected with business-related services much less used a couple of decades ago, such as surveys, planning events, and graphic design.  He acknowledged that computers had ended many positions, such as executive secretaries (down from 1,130,000 to 666,000 from 2010 to 2015), and yet that, Expedia and the like notwithstanding, there were still 67,000 American travel agents.  His points seem to be that jobs come and go in unexpected places, and that the effect on information systems on employment has been neither great nor horrendous but somewhere in the middle.  I think the time we spent together poring over 1966 baseball cards helped him learn how to understand numbers, as it did for me, and it shows here.

In a counterpoint to last year’s press on the intensity of their jobs, we found out from the late Scott Eric Kaufman in Salon on August 29th, in “Amazon to test full-time, full-salaried 30-hour work week” that the online retailing behemoth will try something I’ve recommended for years.  Although that company’s management’s intentions may be good, I see no chance that their managers will truly end up working that little.  The trap they are falling into is similar to that of eliminating performance reviews, which does not end employee assessment and selection for promotions but merely pushes it underground.  As they are knowledgeable enough to be aware of that, I can’t take their effort seriously.

A new set of temporary employees, “Migrant Workers in Recreational Vehicles,” made the pages of The New York Times on October 21.  Author Christopher Farrell described “modern-day nomads” who move around the country, working seasonal opportunities.  They may take difficult physical jobs, such as bringing in agricultural harvests, but are hardly poor, with many old enough to get pension, retirement account, and Social Security income as well.  There are now millions of over-50 Americans with similar work and life characteristics, who in decades past would have been either fully retired or still in their earlier careers, forming a growing set of gig workers providing another way for companies to fill jobs without expensive full-time employees.  That is only one more effect of the permanent jobs crisis.      

In Harvard Business Review on the same date, Avivah Wittenberg-Cox asked “What Happens When Careers Last 20 Years Longer?”  The article didn’t match the title, a good thing since while lives are getting longer careers are not, and addressed how companies might deal with those in different stages of life, from emerging adults not ready for permanent full-time work to the mushrooming count of those over 60 starting businesses.  She made a good common-sense point rebutting those avoiding nepotism, that “it may prove a lot easier to manage dual career couples which they both work for you.”  When I was at AT&T two decades ago, 13% of company employees were married to another one, and that did, indeed, help them continue professionally and stay together personally.

Should we be optimistic or pessimistic about technology and innovation?  The Economist’s October 22nd Schumpeter column, “Techno wars,” surveys both sides and how they both get confused about productivity as opposed to jobs, progress as opposed to lifestyle improvement, and cash income as opposed to unquantified free resources unavailable scant years before.  These are all different things, and this page-long piece could be expanded to a book in which the author would keep them straight. 

Two November 27th articles, “Q&A:  Political economist Eberstadt on men without jobs” in Fox Business and “Jobless by choice – or pain?” from Robert J. Samuelson in The Washington Post, addressed the issue of fewer men in the workforce, which I documented in Work’s New Age almost five years ago.  Nicholas Eberstadt additionally told us that over three times as many men aged 25 to 54 are “neither working nor looking for work” for every one officially unemployed, and that the United States has “had by far the worst drop in male workforce participation.”  Samuelson also seemed to be just discovering things he could have read in my 2012 book, such as “the work ethic is such a central part of the American character that it’s hard to imagine it fading” and that those out of the workforce “spend about eight hours a day… watching TV, playing video games or just hanging out.”  Though he added the depressing news that “nearly half of male dropouts report taking pain pills every day,” he, and Eberstadt, are behind the curve.

“A Dilemma for Humanity:  Stark Inequality or Total War.”  What a title!  It’s from The New York Times on December 6th, on a piece in which Eduardo Porter interviewed history professor Walter Scheidel, whose January book, The Great Leveler, will argue that only something as extreme as “all-out thermonuclear war” can stop our increasing inequality.  That echoed my second-to-last Work’s New Age paragraph, in which I warned that “if we maintain the idea that any decent person has the opportunity to work” we would choose between various disastrous consequences, including “vast numbers of our countrymen without hope, health, or possessions.”  I disagree with the implication here that equality should be our goal, and don’t understand why guaranteed income, to name just one possible comprehensive solution, would not be effective.  Maybe that will be in Scheidel’s book.

Two more pertinent articles came out only Wednesday, but both can be addressed quickly.  Dylan Love’s NBC News “Is Universal Basic Income the Answer to an Automated Future?” is a short overview of that idea, punctuated by recent automation-related news.  Samuelson’s Washington Post “What’s really to blame for the productivity slowdown” starts with “our thinking about productivity is cockeyed,” which it is, if we refuse to realize that so many of our new positions are in areas such as restaurants, retail, and home health care where employers don’t get even $25 per hour value from their workers. 

I’ll end on a more forward-going note by mentioning “Luxembourg boldly goes into asteroid mining” (Financial Times, May 5th).  There is almost unimaginable mineral wealth on those things between Mars and Jupiter, and if you see science fiction writer Larry Niven’s Future History series, you will get an idea of the prosperity, the culture, and, yes, the jobs that harvesting it could create.  Full marks to little Luxembourg with its second-in-the-world GDP per capita, which, if they get somewhere with that, will become even richer.  If they’re not big, at least they can think big – and so can we.

Friday, December 2, 2016

November: Unemployment and AJSN Both Down, Latter Showing a Shortage of 16.9 Million More Jobs

It was another good, steady, positive month on the employment front. 

The marquee number of seasonally adjusted joblessness will take the headlines this morning, and well it should, since it fell 0.3% to 4.6% to reach the lowest level since December 2006.  The unadjusted figure matched that with a drop to 4.4%.  The next best was the count of those working part-time for economic reasons, or keeping shorter-hours positions while seeking full-time ones, down 200,000 to 5.7 million.  The number of people officially unemployed for 27 weeks or longer was also off, 100,000, reaching 1.9 million.  There were 178,000 net new nonfarm jobs created, below a published estimate of 208,000 but continuing its steady trend of coming in at more than needed for incoming people.  The employment to population ratio remained at 59.7%, and the labor force participation rate worsened, down 0.1% to 62.7%.  The poorest news was in average private nonfarm hourly earnings, which, following a 13-cent gain in October, fell back 3 cents to $25.89. 

The American Job Shortage Number or AJSN, which shows in one non-seasonally-adjusted number how many more positions we could fill if getting one were quick, easy, and routine, hit another post-recession low, though its change was not as extreme as in the unemployment percentages.  That was because while the count of people officially unemployed fell almost 400,000, and those wanting work but not looking for it during the previous year was off a surprising 331,000, those improvements were offset somewhat by gains in those discouraged, people claiming no interest in a job, and the “other” category of those wishing to be employed but having a specific reason why that was not possible now.  Overall, the AJSN was off 455,000 from October, as follows:

Compared with November 2015, the AJSN is down 347,000, with demand from those counting as unemployed showing a 456,000 improvement, but with that from other statuses, particularly the number of expatriates, the Other category above, and those wanting work in general but now in school or training, working against that.  We would need to go back to 2008 to find any month at all with a lower AJSN. 

Overall, despite the small negatives and lack of truly large job creation, November gets a thumbs-up.  Our incoming presidential administration will have its hands full improving further.  I hope those responsible for understanding our need for more employment opportunities know that less than 38% of them, even after disregarding those filled by people working already, would go to those officially jobless.  Meanwhile, the turtle, once again, took a modest but unmistakable step forward.