The evidence appears to lend at least some weight to Leontief ’s conclusion, nowhere more so than in manufacturing. In 1970 there were around 1,000 industrial robots worldwide. By the beginning of 2016 that number had risen to 1.8 million and is expected to exceed 3 million by 2020. Since 2010 the global stock of industrial robots has increased by an annual average of more than 10 per cent. Compound growth means if that trend persists manufacturing won’t just stop creating jobs – as it already has done despite massively increased output – but their numbers will significantly decline.
The ever-greater employment of industrial robots correlates entirely with what can be observed in both manufacturing jobs and output. In the two decades following Leontief ’s prediction, information technology and robotics allowed the US steel industry to increase output from 75 to 125 million tonnes while the number of workers declined from 289,000 to 74,000. More broadly, the US lost 2 million manufacturing jobs over the period to automation – around 11 per cent of the sector.
Between 1997 and 2005 that trend only continued to accelerate with US manufacturing output increasing by another 60 per cent while almost 4 million more jobs in the sector disappeared. The explanation why is straightforward: a major rise in productivity allowed industry to produce more with less. By 2007 American manufacturers were using more than six times as much equipment, including computers and software, as they had done twenty years earlier – while doubling the amount of capital used per hour of employee work. Contrary to popular misconceptions in the US of millions of manufacturing jobs being lost to cheaper workers abroad, for the most part they have simply been automated – subject to ever improving eficiency.
Surprisingly, less developed economies fare even worse over the same period, with Brazil enduring a 20 per cent decline in industrial employment and Japan 16 per cent. Perhaps most impressive of all is China which, in the process of becoming the world’s leading manufacturer, lost 16 million industrial jobs. As one journal observed, ‘though it is of course easy to demonstrate that plenty of industrial production still takes place, and that this is not only in important exporter nations such as China, the share of workers actually employed in manufacture has now been declining for almost two decades at the global level.
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