Robots for Trump: Did automation swing the US election?

A new report claims workers displaced by machines are especially likely to support radical change. Businesses should remember they don't exist in a vacuum.

by Jack Torrance
Last Updated: 26 Jul 2017
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Future Business

Much has been written about the causes of Donald Trump’s election victory last year - often in the same context as the Brexit referendum that came five months before it and Marine Le Pen’s strong showing in the French presidential vote.

Is this populist backlash the result of too much inward migration, the arrogance of the ‘metropolitan elite’, ‘marginalisation’ of the white working class or simply the dangerous cocktail of fake news and social media?

All of these factors probably played their part but it seems clear that an underlying cause has been upheaval in the labour market. Many western workers have had a tough time of things over past few decades, thanks to a combination of globalisation, the 2007-8 financial crisis and technological automation. Those who have lost out are thought to be most susceptible to the words of populist politicians.

There’s fresh evidence of that in a new report published by Oxford University’s Martin School this week. Researchers examined electoral districts in the hope of determining to what extent automation of jobs had benefitted Trump, and it seems the answer is rather a lot.

They found that a 5 percentage point increase in the share of jobs lost to automation correlated with a 10% increase in the share of votes for the firebrand Republican candidate. ‘Our study suggests that automation has been the real cause of voters concern,’ said Carl Benedikt Frey, one of the authors of the study. ‘The prime victims of the Computer Revolution (the period starting with the arrival of the personal computer in the 1980s, through to the development of the internet in the 1990s) want anything but the status quo. The populist rebellion in America, Europe, and elsewhere, has many causes, but workers losing out to technology is seemingly the main reason.’

The research contrasts with the perspective of MIT economist Daniel Autor, who has suggested that Trump’s success (and that of other conservative candidates) was potentially swung not by automation but by the impact of trade with China, which he says displaced around one million American manufacturing jobs.

‘If you compared 2000 to 2016 or 2008 to 2016, the gains were significantly larger for Republicans than you would expect in areas that were more affected by the trade shock,’ Autor told Vox in March.

Whatever the cause, the implications for business are not good. Trump’s win and all the associated upsets are the result of a general decline in trust – in corporations, the government, the media and the rest of the establishment. His apparent determination to roll back globalisation and tighten America’s borders – both for goods and people – will ultimately harm the economy. So far it looks like Brexit will have a similar impact.

Whether they’re offshoring jobs or investing in robots, business leaders need to remember they don’t exist in a vacuum, that their actions are inherently political. It might make commercial sense to chase the bottom line today but be prepared for the long-term consequences.

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