Short answer

When designing automated systems or new technologies, consider not only efficiency gains but also the potential for job displacement and actively seek to design for the creation of new, human-centric tasks to balance the 'displacement effect' with a 'reinstatement effect'.

Field: Commercial Production
Source: The Journal of Economic Perspectives (2019)
Method: Theoretical framework development and empirical decomposition.
Evidence: Strong effect

Automation, while boosting productivity, displaces labor from existing tasks, and if not balanced by the creation of new tasks, leads to slower employment growth and a reduced labor share in value added. This commercial production research insight is drawn from a 2019 study published in The Journal of Economic Perspectives. Using Theoretical framework development and empirical decomposition., researchers explored how this design variable affects real-world outcomes. The key design takeaway: When designing automated systems or new technologies, consider not only efficiency gains but also the potential for job displacement and actively seek to design for the creation of new, human-centric tasks to balance the 'displacement effect' with a 'reinstatement effect'.

Study

Commercial ProductionHigh ImpactStrong effect

Accelerated automation increases labor displacement and reduces employment growth

The Journal of Economic Perspectives · 2019

Key Findings

01Automation always reduces the labor share in value added and may reduce labor demand due to a 'displacement effect'.
02The creation of new tasks, where labor has a comparative advantage, always raises the labor share and labor demand due to a 'reinstatement effect'.
03Slower employment growth in the US over the last three decades is attributed to an acceleration in the displacement effect (especially in manufacturing), a weaker reinstatement effect, and slower productivity growth.

Application

Design takeaway

How to apply

When designing a new automated manufacturing line, instead of just replacing all human workers, identify tasks that require human creativity, problem-solving, or interpersonal skills, and design the system to integrate these human roles alongside automation, potentially creating new job categories.

Project actions

01When designing an automated product or system, brainstorm potential new roles or tasks that humans could perform alongside or because of your design.
02Consider the ethical implications of your design on employment and propose solutions to mitigate job displacement.
03Research how specific industries are adapting to automation by creating new job categories.

Method & Evidence

AimTo develop a framework for understanding the effects of automation and technological changes on labor demand and to interpret recent changes in US employment.

MethodTheoretical framework development and empirical decomposition.

ProcedureThe authors developed a framework centered on the 'task content of production,' where automation displaces labor from tasks, and new tasks reinstate labor. They then applied this framework to industry-level data to decompose the factors contributing to employment growth over recent decades in the US.

ContextUS employment trends over the last three decades, particularly in manufacturing.

Variables

IVAutomation and technological change (specifically, the rate of displacement and reinstatement of tasks).

DVLabor demand, employment growth, labor share in value added.

CVNot explicitly controlled in this macro-economic analysis, but the framework attempts to isolate the effects of automation from other economic factors.

Strengths & Limitations

Strengths

+Provides a clear theoretical framework for understanding automation's impact on labor.
+Empirical decomposition offers insights into historical employment trends.

Limitations

This study is a high-level economic analysis. It doesn't tell you exactly how to design a product to create new jobs, but rather highlights the need for such considerations at a strategic level.

Reliability & validity

The study's reliability comes from its robust theoretical framework and the use of established economic data. Validity is supported by its ability to explain observed employment trends. However, like all economic models, it relies on assumptions and simplifications of complex real-world interactions.

Think critically

How might a designer specifically integrate the 'reinstatement effect' into the design process for a new automated manufacturing system, beyond just making it more efficient?

Design Principles

"Design for Human-Technology Synergy: Develop technologies that not only automate existing tasks but also create new opportunities and tasks where human skills are essential and valued, fostering a balanced labor market."

This insight is crucial for design students to understand the broader economic and societal implications of technological advancements in manufacturing and production. It highlights the need for designers to consider the human element in automated systems and the potential for job displacement, linking to ethical design and sustainable development goals.

What This Means for Your Design

When factories use more robots, some jobs disappear (displacement), but if we also invent new types of jobs that only people can do (reinstatement), then overall employment can stay healthy. Recently, robots are taking jobs faster than new jobs are being created.

How to use in your project

1.In 'Criterion A: Problem Identification', you could discuss how automation in a specific industry (relevant to your project) is leading to job displacement, and how your design aims to create new opportunities or mitigate this.
2.In 'Criterion B: Research', you could cite this paper to support arguments about the economic impact of automation or the importance of creating new tasks.
3.In 'Criterion C: Development', when proposing solutions, you could explain how your design considers both automation efficiency and human employment, aiming for a 'reinstatement effect'.

Add to My Project

Quick Cite

Paragraph starter

Acemoğlu and Restrepo (2019) highlight that automation, while increasing productivity, can displace labor from existing tasks, leading to reduced employment growth unless balanced by the creation of new tasks where labor has a comparative advantage. Their research indicates that recent slower employment growth is due to an accelerated displacement effect and a weaker reinstatement effect. This emphasizes the critical need for designers to consider not only the efficiency of automated systems but also their societal impact, actively seeking to design solutions that foster the creation of new, human-centric roles to mitigate job displacement.

Source

The Journal of Economic Perspectives

Automation and New Tasks: How Technology Displaces and Reinstates Labor

journal · 2019

View source

Questions About This Research

What does the research say about accelerated automation increases labor displacement and reduces employment growth?: When designing automated systems or new technologies, consider not only efficiency gains but also the potential for job displacement and actively seek to design for the creation of new, human-centric tasks to balance the 'displacement effect' with a 'reinstatement effect'. Evidence: The Journal of Economic Perspectives (2019).
Why does "Accelerated automation increases labor displacement and reduces employment growth" matter for design?: This insight is crucial for IB DT students to understand the broader economic and societal implications of technological advancements in manufacturing and production. It highlights the need for designers to consider the human element in automated systems and the potential for job displacement, linking to ethical design and sustainable development goals.
How can designers apply this research?: When designing automated systems or new technologies, consider not only efficiency gains but also the potential for job displacement and actively seek to design for the creation of new, human-centric tasks to balance the 'displacement effect' with a 'reinstatement effect'.
What were the main findings?: Automation always reduces the labor share in value added and may reduce labor demand due to a 'displacement effect'.. The creation of new tasks, where labor has a comparative advantage, always raises the labor share and labor demand due to a 'reinstatement effect'.. Slower employment growth in the US over the last three decades is attributed to an acceleration in the displacement effect (especially in manufacturing), a weaker reinstatement effect, and slower productivity growth.
What research method was used?: Theoretical framework development and empirical decomposition..
How strong is the evidence?: Evidence strength is rated Strong effect, based on a 2019 journal from The Journal of Economic Perspectives.
What should I do differently in my next project?: When designing a new automated manufacturing line, instead of just replacing all human workers, identify tasks that require human creativity, problem-solving, or interpersonal skills, and design the system to integrate these human roles alongside automation, potentially creating new job categories.
What are the limitations?: The study focuses on macro-economic trends in the US and does not delve into specific design choices or individual product impacts. It's a theoretical and empirical analysis rather than a direct design intervention study.