David R. Henderson  

Could Driverless Trucks Create More Trucking Jobs?

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Answer: Maybe and even if they don't, it doesn't matter much.

Timothy Taylor, aka The Conversable Economist, has an excellent post in which he reports on another study about whether driverless trucks could create more trucking jobs. I'll quote a paragraph that Tim quotes from Uber Advanced Technologies Group:

The biggest technical hurdles for self-driving trucks are driving on tight and crowded city streets, backing into complex loading docks, and navigating through busy facilities. At each of the local haul pick ups and drop offs, there will need to be loading and unloading. These maneuvers require skills that will be hard for self-driving trucks to match for a long time. By taking on the long haul portion of driving, self-driving trucks can ease some of the burden of increasing demand, while also creating an opportunity for drivers to shift into local haul jobs that keep them closer to home.

Tim also writes:
The crucial part of the scenario is that most trucks, given their human drivers, are now on the road for only about one-third of every day. However, the long-distance driverless trucks could be on the road two-thirds or more of every day. As a result, the costs of long-distance shipping would drop substantially, which in turn would give firms and consumers an incentive to expand the quantity of what they ship by truck. In one simulation that has 1 million driverless long-distance trucks on the road, the result is an additional 1.4 million drivers needed for shorter-haul local trucking.

Tim also notes that the Uber group has put its models and data on a site that you can go to.

It's important to note, though, that even if there are fewer trucking jobs, there's an unlimited amount of work to be done. So if driverless trucks come along, I confidently predict that two years after the big shift, whenever that is, there will be more jobs (assuming no recession and assuming no big crackdown on immigration), not fewer.

Here's what I wrote about the issue of automation and jobs that relates to this issue:

In 1760, Richard Arkwright's cotton-spinning machinery was introduced. At the time, England had 5,200 spinners using spinning wheels and 2,700 weavers, for a total employment of 7,900. But by 1796, after Arkwright's invention had been well integrated into the production process, the number of spinners and weavers was 320,000, an increase of over 3,900 percent.

Why? The answer is, in economist's jargon, high elasticity of demand. The invention crushed costs, and so prices for textiles fell a lot. Clothing was no longer a luxury. The lower prices caused many people to buy more clothing more often. Overall output soared.

But consider another case in which the opposite happened: farming. In 1900, farm workers made up 41 percent of the U.S. labor force. By 2000, that was down to two percent. It's true that the U.S. labor force had grown substantially during the century, from 27.6 million to 142.6 million. But even in absolute terms, the number of farmers fell, from 11.3 million to 2.9 million. Virtually all of the decrease in the labor force in farming was due to technology. Compare pictures of farm machinery now to pictures of farm machinery then. The latter were known as horses. Farming became an order of magnitude more productive. So jobs were destroyed in farming. But were jobs destroyed on net? No. The number of jobs rose in line with the labor force. [Quote altered from original because of mistake in original.]


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COMMENTS (15 to date)
kazimir writes:

Hi David,

I love your blog and read it regularly, and am a bit embarrassed that this is my first and only comment so far: The author of the article is Timothy Taylor...

Best regards,
Kazimir

john hare writes:

Labor in construction trades is so hard to find that contractors are interested in new methods and tools now in a way that they were not ten years ago. I'm not hearing about jobs lost from my invention ideas lately.

David R Henderson writes:

@kazimir,
Thanks, kazimir. I’m embarrassed because I know and like Tim.

Matthias Goergens writes:
Virtually all of the increase in the labor force was due to technology.

Shouldn't that be decrease? (And as part of the quote, perhaps should get a [sic]?)

Grant Gould writes:

In this scenario, truck drivers become something like harbor pilots, leveraging local knowledge and taking on the fiddliest but also safest part of the job, while the autonomy system takes on the tedious and dangerous task. It's really a perfect scenario for win-win collaboration.

Might get to be a congestion problem as it pans out, though. Making trucking more efficient will mean more load on the unpriced factor -- roads. Autonomy systems can make more efficient use of highways through convoying, drafting, and wear-minimizing driving patterns; by contrast the first and last mile could get awfully congested. Pricing of minor local roads is probably a non-starter, as is widening dense urban roads for the increased traffic.

This will be a fun one to watch evolve. People are going to come up with fascinating and odd solutions.

David R Henderson writes:

@Matthias Goergens,
Thanks. My understanding of the rules is that I shouldn’t “sic” myself and so you’ll see how I changed it.
@Grant Gould,
Good thoughts.

Antischiff writes:

Dr. Henderson,

Do you think technology will eventually lead to a reduction in the quantity of labor demanded?

Antischiff writes:

Dr. Henderson,

Also, do you have a prediction on what happens to the wages of truck drivers who are replaced by autonomous vehicles?

Thaomas writes:

There should not be any doubt that an economy with sufficiently flexible prices can maintain full employment in the face of technical change (short term monetary and fiscal errors apart). There is no guarantee that that employment will not become highly polarized with many low paying jobs with the implication that some (many?) people will be harmed by technological progress.

The possibility of a "worsening" distribution of income may not worry pure Libertarians, but it does the rest of us.

David R Henderson writes:

@Antischiff,
Do you think technology will eventually lead to a reduction in the quantity of labor demanded?
No. Remember that the quantity of labor demanded is the result of both demand and supply. But if you meant a decrease in demand for labor, even there I don’t think so.
Also, do you have a prediction on what happens to the wages of truck drivers who are replaced by autonomous vehicles?
If I take you literally, probably a reduction. That is, the ones who are replaced will be disproportionately those with fewer skills at doing the things that truck drivers will need to do. But for truck drivers overall, I don’t have a prediction.

David R Henderson writes:

@Thaomas,
There should not be any doubt that an economy with sufficiently flexible prices can maintain full employment in the face of technical change (short term monetary and fiscal errors apart). There is no guarantee that that employment will not become highly polarized with many low paying jobs with the implication that some (many?) people will be harmed by technological progress.
Well said. I agree with everything you said above.
Although there is no guarantee, my own prediction is that almost everyone will be helped by technological progress.

Antischiff writes:

Dr. Henderson,

That is interesting. It seems inevitable to me that eventually, "This time will be different." and the demand for labor in general will fall and asymptote at 0. When AI is designing AI and hardware, along with non-AI algorithms, it's hard to believe many will want to hire people at all, apart from very social professions.

We may not see this trend even begin in our lifetimes, but I think human labor is on its way to obsolescence.

Antischiff writes:

Dr. Henderson,

Thank you for correcting my sloppy language. Obviously, quantity demanded implies a demand schedule.

@Thaomas,

There should not be any doubt that an economy with sufficiently flexible prices can maintain full employment in the face of technical change (short term monetary and fiscal errors apart>).

Actually, you need to add the requirement of a free market. Flexible prices in an economy like ours with so many regs that favor large corps and create oligopolies will not create more jobs, let alone full employment

Gary Foster writes:

The author misses the point that long haul drivers make more money than local drivers. The difference is significant. Also, the need for independent truckers will never stop given the flexibility they provide. In time driverless trucks will become a problem due to breakdowns, inability to deal with complex situations. How will they be stopped by portable weight units? If half it's tires blow would it keep going? These are among a myriad of problem not easily solved and in the end I doubt the savings will be there.

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