Automation and How It Affects Our Jobs

General Finances
By JingCheng Woo,

In the 1760s, the use of coal for power generation kick-started the Industrial Revolution. Manufacturing methods transited from hand tools to machine tools. Since then, there has been a constant fear that automation might spawn mass unemployment.

Economists have divided opinions on the debate about the future of the labour market and the economy. In this article, we will illustrate why you shouldn’t be worried about automation.

Neoclassical economists predicted that the labour market would balance out as people would find other jobs. Looking at the past 200 years of labour statistics, they were right.


We are no strangers to automation anxiety. Automation was ranked first as the major job challenge in the 1950s and media reports suggested that automation would cause mass unemployment in the labour market and social unrest. Heck, even President Obama has warned that ATMs and airport check-in kiosks are contributing factors to high unemployment. Sounds too familiar? That’s right, this is what the media today seems to tell us as well. If there is one thing that history tells us, the mainstream media is bad at predicting the future.


Machines have displaced millions of jobs like farmers, telephone operators, factory workers and railway workers. The number of people working as these professions today is nowhere comparable to the 1950s. Jobs die, but work continues. What these numbers do not show are the jobs that are created.


When there is new technology that displaces jobs, there will likely be jobs created to develop and maintain the technology or spawn new industries on top of these new technologies. Think about factory workers. When factory workers are replaced by machines, there would be a demand for technicians and engineers, hence, there is a shift of labour.

What does this mean for us?

We need to be mindful and reinvent ourselves if need be. We may have to undergo reskilling or upgrading to match the demand for skills. This is where government initiatives like SkillsFuture aims to facilitate more people to transit from sunset industries to new sunrise ones.

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