By Alan Murray
January 13, 2017

Good Friday morning.

Recent developments in robotics, artificial intelligence and machine learning have the potential to eliminate half the activities people are currently paid to do in the workforce, according to a study out from the McKinsey Global Institute this morning. And it’s not just manufacturing jobs. Many middle- and high-skilled jobs, including those in data collection and processing, have a significant degree of automation potential.

That change won’t happen overnight. The McKinsey report says it will take anywhere from 20 to 40 years for half of today’s work activities to be automated. And new jobs will be created in the process.

“People will need to continue working alongside machines to produce the growth in per capita GDP to which countries around the world aspire,” says the report. “Thus, our productivity estimates assume that people displaced by automation will find other employment.” But the work they do will have to change, requiring considerable re-education and training.

The report says the coming shift is of a similar order of magnitude to the shift away from agriculture that occurred in developed countries in the 20th century. You can read the full report here.

Separately, I spent a few hours yesterday visiting Year Up an impressive program that gets disadvantaged young adults from urban neighborhoods into the workforce. Year Up students spend six months in a classroom, learning both technical skills and “soft skills” – interviewing, workplace behavior, etc. – and then six months in an internship. The majority end up with full-time jobs, starting at an average of $38,000 a year. President Garrett Moran, a former Blackstone executive, says the program, which this year had 3,000 graduates, attempts to prepare the students for lifelong learning – a skill they’ll clearly need, given the changes mentioned above.

More news below. And if you want to stay on top of how coming changes in Washington are going to affect business, sign up for our newest newsletter, the Trumponomics Daily, here.

Alan Murray


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