Pages

Automation Might Make Income Inequality Worse According to This Study

Automation has become a core component of retail because of the fact that this is the sort of thing that could potentially end up helping corporations to cut down on costs. After all, why would corporations pay someone to bag groceries when they can just set up a fancy self checkout station and have shoppers do it themselves? However, for all of the convenience that automation is bringing in this and several other arenas, it is also bringing a lot of negative outcomes.

An economist working at MIT by the name of Daron Acemoglu recently did a study that revealed the impact that automation is having on income inequality. With all of that having been said and now out of the way, it is important to note that at least 50% of the increase in income inequality since 1980 can be attributed to increased levels of automation according to the findings in the study.


Automation might help corporations to reduce costs, but it does nothing to improve efficiency and productivity. To make matters even worse, it has resulted in a 15% drop in the average earnings of people who do not have a high school degree. There are definitely other factors at play here, but automation is likely making the problem even worse than might have been the case otherwise.

Men without a high school degree are earning 8.8% less as a direct result of automation with all things having been considered and taken into account. Customers don’t stand to gain much from things like self service kiosks, but in spite of the fact that this is the case corporations will continue to implement them because they are beneficial to the bottom line.

As automation continues to become a prevalent force in the world, we might see a further widening gap between the richest and poorest members of society. This shows how corporations may not always make the best decisions in terms of productivity or customer satisfaction. Instead, their decisions will always be based on whatever can make them the highest possible amount of money, regardless of what the cost might be.

Read next: These Are the Top 5 Home Based Freelance Jobs

No comments: