Workers comp and the jobless economy

Service workers are VERY replaceable.

Amazon just opened the first cashier-less grocery store.

2 million trucking-related jobs are likely to disappear within a decade. Consumers’ costs for goods will go down significantly, driven by lower labor, fuel, insurance, and maintenance costs.

What is only just beginning to happen in the service economy is already well underway in manufacturing. Despite all the blather about US manufacturing’s decline, the fact is we remain the second largest manufacturer in the world, not far behind China. Yes, employment has declined dramatically, but productivity has increased by leaps and bounds.

US manufacturing:

  • is over a third of our GDP
  • is valued at over $6 trillion annually in output
  • is larger than the next three countries – Japan, South Korea, German – combined.

Since 1947, we’ve figured out how to make five times as much stuff with 13% fewer workers. 

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source – https://audiotech.com/trends-magazine/the-american-manufacturing-renaissance-becomes-a-reality/

I bring this to your attention, dear reader, to pose the following questions.

  1. What happens when trucking jobs disappear? Higher work comp claiming rates? Much more difficult re-employment?
  2. What happens when cashier jobs disappear? Same thing?
  3. As automation gets cheaper, takes on more human functions, and extends into more and more areas, wage growth is very likely going to suffer – people don’t compete well with machines. What happens to work comp premiums?

In all the talk about the need to reform workers’ comp, there’s been very little discussion about these existential threats to the industry.

What does this mean for you?

You don’t need to “reform” an industry that won’t exist in a dozen years.

 

 

11 thoughts on “Workers comp and the jobless economy

  1. Answers:
    1. Most folks are going to be jobless. No to higher rates. Yes to difficult re-employment.
    2. Yes to same thing.
    3. Work comp premiums/insurance disappear when you don’t have “workers.”

    All of this means less jobs for lawyers, insurance peeps, risk and safety, HR and all the stuff we have now to manage humans.

    Agreed there is little need to reform an industry that may disappear.

    The big and looming question–can we stop it or at least bring it about slower to allow humans to adjust???

    In my view, minimum wage hikes are ramping this up and should be carefully reconsidered.

    And for baby boomers, consider early retirement options because we may not have a choice.

  2. Great article, Joe!

    In light of your observations on technological displacement, isn’t it safe to say that the problem we’ve been battling for years – RTW; is soon to be a much larger problem? For example, what does a truck driver do if his/her job disappears while they are recovering from a rotator cuff injury? We may see an emerging focus on the need to RETRAIN injured workers so that they can FIND work.

    Fewer injuries, yes, but larger (more costly) problems to be solved might actually save the WC/WR (Workers’ Recovery) industry.

  3. The biggest challenge the world will face in the next two decades is what to do with the folks that will be displace from work. At lease 50% of current jobs will be gone in the next 20 years.

  4. …as an aside at some point you have to stop trying to wring out that last 0.0000001% out of everything and just smell the roses.

  5. Appreciate your perspectives here. That said, I do think driverless trucks may be less imminent than projected.

    A USA Today article, noting a change in Google’s financial approach to driverless technology, states, “While the idea of a car driving itself is not only culturally intriguing but increasingly scientifically possible, the reality is that factors such as government regulations, liability concerns and consumer reaction make the leap to full autonomy more sci-fi than immediate urban reality.”

    I really think this is a ways off, based more so on the issues cited in the quote above, than on technology advancements. DOT can’t get it together to add synthetic opioids to the required UDT panel– can’t imagine how long it would take them to approve driverless trucks.

    Finally, even when driverless trucks do make it mainstream, the consumer delivery companies (USPS, UPS, FedEx, DHL et al) will still need drivers to exit trucks, pull packages, and make deliveries.

    http://www.usatoday.com/story/tech/news/2016/12/12/google-steer-clear-fully-driverless-car-report/95360570/

    • Craig – thanks for the observations.

      Agree that our regulatory apparatus is far from ready to address widespread automation, however it will get there at some point. I’d note that driverless trucks are already allowed in some areas albeit in test mode only. As Tesla and others get more data on vehicle history it may well be that automated vehicles are demonstrably safer than ones we humans drive.

      When consumers get cheaper stuff faster, they tend to like that. If their neighbor’s job disappears…

  6. We may need to seriously consider the idea of a Universal Basic Income (UBI), but one that will allow displaced workers to not just get by, but to maintain some semblance of what they had before automation eliminated their jobs.

    But given the incoming Corporatist/Fascist administration and their lackeys in the next Congress, that won\\\’t happen anytime soon, so be prepared for more anger, frustration and maybe even outright violence against those perceived to be responsible, i.e., immigrants and the poor.

    One possible scenario for the future comes from the world of science fiction, in particular, the world of Star Trek. Ever notice in all the shows, non-Starfleet personnel are either scientists, or artists or people with skills no robot can take away. In the series \\\”Deep Space Nine\\\”, the station commander\\\’s father owns a restaurant in New Orleans. There is one episode of The Next Generation in which Captain Picard tells a man from the 21st century that people work to improve themselves. Perhaps we need to open our colleges and universities to allow permanently unemployed to take courses in humanities and the arts,

    • Huh? You’re suggesting that only corporate fascist may be skeptical that the (untested at any scale) theory of UBI will solve these potential problems? That seems like a pretty drastic statement.

      Perhaps UBI, coupled with other efforts to demonetize the cost of living, could be a solution someday, but that wouldn’t be the answer I would immediately jump to and certainly not within the next 4 to 8 years of this administration.

      Also, I’m just wondering, if in the future everyone’s going to be spending their unemployed time learning about Picasso and Dickens, who’s going to be paying the cost? Maybe we can just get the universities to waive everyone’s tuition and fees. If they don’t agree we can always expand our definition of corporate fascist to include them.

    • Yes. Spend those dollars that would have gone toward reforming the industry to instead go to educational grants for displaced workers. Create a list of growing jobs/needed skills and fund educational programs to train those skills to the displaced workers.

  7. I agree Joe, a number of jobs/industries will be significantly different in 5 – 10 years, than they are now. WC will also be significantly different. Different does not mean gone, gone. It means different than what we know today.
    How we get news may provide a reasonable analogy here – not too long ago newspapers were how most of us got news. Today, the internet news sources, both from traditional news sources as well as blogs, social media, instant news (accuracy issues aside) are how most of get news. Some job titles, newspapers and newspaper jobs went away, but the news is still being provided – by people who participate, observe and report it (just like it used to be in the newspaper). For the most part, jobs changed, more than went away.

    I guess the ultimate point is change is inevitable. We cannot win by trying to hold onto what we have and are comfortable with.
    We have to figure out how to adapt to what will be. The work/jobs we have now, will be different. Society will figure out how to train people to support that different work/jobs. Change can be painful, and I personally will feel pain too, but it will happen, whether we like it or not. The WC industry we know now will not be there, but something else requiring the same kind of services will be.

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