What’s the Best Way to Help Low-Income Workers? Automate Low-Income Jobs

Reducing unemployment and getting the COVID-impacted economy back to some semblance of normality is clearly the top economic task. But when that is done the economy will still face a critical labor market problem: too many workers earning too little. A recent Brookings study found that 44 percent of American adults workers make very little, with median annual earnings of just $18,000.

Writing in American Compass, Rob Atkinson lists two broad approaches to addressing this challenge: first is to transfer more societal resources to these workers, second is to create more high paying jobs. Fortunately, the next wave of technological innovation, grounded in artificial intelligence, internet of things, and robotics, is likely to have a higher impact on lower wage jobs. As ITIF has estimated, the correlation between the average wage of an occupation and its risk of automation over the next decade is negative and quite large (around -0.55).