This topic came to mind and was initiated by a friend who posted that her very recent airline flight auto landed itself after the pilot announced that the plane’s built-in system would do the landing because of the fog over the airport. Thank God she landed safely because she is a Goddess, a great person and she spreads her great quotations, love and words of wisdom on facebook, among other places, and shares them with the world. She has a Big Heart, touches us, inspires us and makes us think and that is huge!
First, Wendy’s announces 6,000 layoffs of their cashiers and will automate ordering and paying for orders because the cost of minimum wage is gradually going up to $15 an hour. Next, the new Chase branch at Desoto Ave and Ventura Blvd. has these new automated machines replacing bank tellers. There was only one live, human teller in the whole branch. Other branches have or are doing this too.
However, the automatic landing of a plane seems to take this to a new level.
My friend mentioned driverless cars (on the horizon), which make sense for the elderly or someone visually impaired as long as they are safe!
Interesting new world we live in.
So what are the economic and other effects of this new world of Automation and Technology?
My friend who safely landed indicated she’s sad but excited about this new automation/technology world we are in (entering). She indicated that she liked the human touch and would rather interact and have her questions answered by a human (employee) but appreciated the efficiency of computers and electronics.
I wholeheartedly agreed. What’s sad is there are many students who work those jobs at Chase Bank and Wendy’s that help them pay their way through college. Without those jobs, they may have to take student loans. If the economy doesn’t improve when they graduate (if they can’t find jobs), they will default on these loans and this can have a domino effect on the economy.
In contrast, technology is amazing and it’s very exciting to see what device or machine inventors/visionaries will come up with next.
A Look At This From The Major Corporation’s View
Let’s say it costs Chase Bank $30,000 to develop and produce one of these modern, new Automated Teller Machines and each new Automated Teller Machine placed in a branch replaces a human teller. Further, let’s assume that each full-time Teller costs Chase $40,000 a year to employ. The $40,000 is computed as 2,000 (50 weeks times 40 hours a week) hours a year times $15 an hour so that’s $30,000 in wages. Let’s add in another $10,000 that includes payroll taxes, workers comp., and employee benefits and perhaps two weeks vacation.
Because the cost to develop and produce a modern, new Automated Teller Machine is only $30,000, Chase begins to save money after the Automated Teller Machine operates for nine months. From Chase’s point of view this makes sense. Will it’s clients look elsewhere to bank? Probably not! There are some customer service representatives in the branch to assist with transactions using the new machines.
The bright side is a company was contracted by Chase to produce the machines. But, was it a U.S. firm? or was it contracted out to an overseas firm?
What are the long-term effects of this automated/technology replacement of jobs phenomenon? What will be the effects on inflation? These are questions that may be explored in my next blog post so stay tuned!