There is a wives-tale out there that Internet-driven innovation today is causing net job loss.

It's a tale that has enjoyed a thousand lives and dates back at least to 19th century France where 'saboteurs' (from the word, 'sabot' - shoe) threw their shoes into machinery to break it and prevent their jobs from being automated out of existence.

Certainly, innovation does hit some jobs. If Google self-driven cars gets its way, traffic cop jobs will disappear. But as a rule, history has shown innovation (as measured by productivity improvements) causes no net job loss.

Check out this diagram of year-over-year productivity improvement. The rate of change isn't changing.

For a deeper dive into the economics of productivity and why it does not impact full employment, see Jared Bernstein who concludes that "the problem isn’t productivity; it’s negligent policy".


Tags: Google, News, Innovation, Saboteur