In the past, the price of just about everything increased over time but thanks to technology, many products and services are getting progressively cheaper and in many cases, better. In the 1980s, you could have paid 25 cents per-minute for a domestic long-distance call and dollars per-minute for international long-distance. Not only has the price of a long-distance call dramatically decreased over time, today, IP communications assigns no per-minute cost to communicate. In fact, you can now use Skype (News - Alert) to set up a free baby monitor a continent away with HD-quality video and audio that puts the phone company's quality to shame.
More impressively, today’s smartphones pack the punch of mainframes or even supercomputers from about a decade ago, and they are far cheaper. The first flat-screen TVs cost thousands of dollars, but now we can get a similar or even better quality TV viewing experience on a tablet or smartphone via a free app. Wi-Fi and 4G/LTE (News - Alert) have turned every connected area into a virtual office, allowing parents the ability to easily work while keeping an eye on kids or while being engaged in other activities. Software has improved manufacturing, inventory management, customer service, analytics and anything else you can think of that boosts productivity.?Decades ago a cheap or out-of-tune automobile would have lots of trouble starting and would stall often in the cold weather. Thanks to current automation, cars almost always start, run and will soon be able to drive themselves.
Yet at every turn there are naysayers who say technology destroys jobs. The argument could have been easily made that the industrial revolution would be a job killer. If there was ever a new technology that should have eliminated employment it was the one that almost eliminated the need for manual labor.?
The invention of the car eliminated the jobs of countless farm hands and blacksmiths making horse shoes, but somehow more jobs were created after this invention. Electricity adoption meant even less manual labor was needed thanks to powered sewing machines, dishwashers and other devices. It's application to the modern house and factory should have killed even more jobs.?The fax machine allowed you to get a contract across the world in seconds for a ridiculously small amount of money. It should have eliminated millions of jobs and sank the global economy. Then there was the massive amount of automation afforded by the mainframe, mini, personal computer and so on.?Just think how much less labor is required to send a text message or e-mail than a letter, and consider at one point a letter could have touched the hands of a dozen people before it got delivered. Using the flawed logic of technology equals less jobs, it's a wonder that after Facebook (News - Alert) was created any jobs remain.
The truth is, in every one of these cases, some old jobs were destroyed, but many more were created as a result. And a new white paper from UBS argues that technology growth and application to the economy will continue to be an incredible driver of economic productivity, and it will make the world far more prosperous than we can imagine.
UBS believes the U.S. is positioned well to benefit from many of these advances due to our headstart in the tech space. The good news is the technologies above will lower the price to produce many goods and will potentially put downward pressure on the inflation rate thanks to lower energy costs and the continuing technological revolution being applied to everything. The downside in my opinion will be the same challenge we have seen for decades: The lower-skilled worker will have more problems finding a job thanks to more automation.
The tech market continues to do its part – innovating and coming up with new business models and ideas. Now it’s up to regulators to help grease the wheels allowing demand to pick up and the creation of new jobs. While the gridlocked nature of today’s politics may make this task more difficult, the good news is tech will still continue to innovate and create a much better economy and standard of living for the entire planet. Yes, you should be bullish, very bullish, on technology.
Edited by Stefania Viscusi