Gigaom AI Minute – July 29

Transcript

Question, are there more bank tellers today in the US than there were before the invention of the ATM? Surprisingly the answer is, yes, in spite of the fact that ATM stands for automatic teller machine, and it came along amidst widespread predictions that it would eliminate tellers' jobs. There are more tellers today. What's going on there? ATMs, as it turned out, lowered the cost for banks to open new branches. Therefore banks opened more and each of those needed some number of tellers. Thus we end up with more bank tellers and more bank branches.

Of course it doesn't always work that way, does it? Farming would be a case where clearly we lost net jobs. There are less farmers today than there were 50 years, 100 years, and so forth.

There are less switchboard operators for that matter, but the important thing to note is that the calculation is never as straightforward as it might seem at first glance. As technology lowers the cost of items, it frees up money that consumers and businesses can spend elsewhere creating new jobs. This is the basic dynamism that has kept us at near full employment for a very long time.