Technological Unemployment: Down The Road It Wont Be Hard To Find A Parking Spot On Wall Street
Do you remember this scene in the movie Trading Places where Eddie Murphy and Dan Akroyd made a killing in orange juice futures? One thing about the scene iss the mass of humanity on the trading floor. Fast forward to 2017 and you do not see those people anymore. Watch CNBC some morning when they cut to the CME and notice how few people are really on the trading floor.
The financial industry is standing right at the elbow of an exponential curve that is about to blast off. Computer automation is something this sector has invested in for the last decade and a half. Today, we are at the point where massive implementation is about to take place. Already, a number of exchanges (like stocks) are heavily automated. The next few years will see the spreading of this to other aspects of the financial arena.
An article in Bloomberg spells out all the jobs that are in danger of being eliminated. Before going any further, I must remind everyone that these are not low wage jobs, When you are looking at people in the banking industry, especially those on Wall Street, you are looking at high income earners. For example, Goldman was able to replace 600 traders with 250 systems analysts. The net of 350 jobs might not sound like much but the income is enormous. The traders were each making between $450K-$1M with some exceeding that amount. Their replacements make $100K-$125K.
Banks and investment funds have been tinkering for years, prompting anxiety for employees. Now, firms are rolling out machine-learning software to suggest bets, set prices and craft hedges. The tools will relieve staff of routine tasks and offer an edge to those who stay. But one day, machines may not need much help. It's no wonder most of the jobs Goldman Sachs Group Inc.'s securities business posted online in recent months were for tech talent. Billionaire trader Steven Cohen is experimenting with automating his top money managers. Venture capitalist Marc Andreessen has said 100,000 financial workers aren’t needed to keep money flowing.
As I stated, this is in keeping with a trend that started years ago. For those who did networking for business, think back to Chamber events a decade ago. What profession was always there (outside of real estate)? Stock brokers. When was the last time you saw a stock broker? Online trading has made them basically extinct.
Brokers, traders, analysts, and money managers face a good chance of being replaced by computers in the next 5-10 years. These are high income people many of whom are prominent politically. I do not think the political class will be able to stick their heads in the sand while promising "to bring the jobs back" when that happens. Jobs replaced by technology do not come back.
For a further breakdown of the financial jobs at risk, check out the full Bloomberg article.
Automated trading really makes me uncomfortable. It's one of those ideas that, once you start thinking about it, you just can't see how it can go on.
And yet, here it is.
My original comment grew into a post of its own, so thanks for the link to the Bloomberg article, and the inspiration!
Now that I think about automated trading, I just can't see how it cannot go on.
It is here to stay.
The future brings even faster changes.
It is accelerating.
Great enjoy a lot want to see more of this in future. @taskmaster4450
I firmly believe cryptocurrencies are going to change the banking and investment systems in ways we can’t imagine over the next decade.
There are even bots trading crypto now.
Doesn’t surprise me.
Bot are on here voting too.
This is true.
Blockchain and crypto will change most things around us including government.
There is nothing that is not going to fall under this spell. It is akin to the internet, there isnt a business that isnt affected by it even if it is only to use it.
I keep hearing the “experts” say Bitcoin ‘s in a bubble. They just don’t get it. I only wish I would have had more courage to buy more when it was cheap!
Many jobs are and will be subject to automation. It is not anymore about low wage and low skills jobs.
There are already a few companies using effectively AI for trading, assisting for legal document research and other kind of tasks.
It will be the mostly cost effective on anything that is mainly manipulating information: accounting for instance.
There is this interesting and "sad" (because it is already a bit true) book about this subject:
Rise of the Robots: Technology and the Threat of a Jobless Future by Martin Ford
It is happening before our eyes yet people still deny that it is taking place.
They simply do not believe this time is different.
Yes I do agree, many people do not understand the outcomes and they don't like to receive this kind of "bad" message: "you know this job you are doing will not exist anymore sooner than you think".
It is similar on some aspects to "regular" outsourcing while being quiet worse on the long term for the economy of a given country, and also the set of external dependencies that it creates.
waaah, very unique .. pulled once jostling like that .. excited .. chose me friends as friends in steemit this.
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