The interesting part of their study to me is the contrast of 1950-1980 vs 1980-2016.
Their basic argument is this: those groups who saw the greatest "task displacement" saw the least wage growth or biggest wage declines, and task displacement was primarily driven by automation. Essentially, groups who saw the highest levels of automation, saw the biggest wage declines.
But when they look at this in 1950-1980, they find that was not true. There was no correlation between task displacement and wage decline (Figure 6, if you want to look at the PDF). Their explanation is because we did not have widespread automation before 1980. I didn't read it closely enough, but I think their argument is that task displacement prior to automation tended to affect workers more evenly, but automation meant that it became focused on routine tasks which disproportionately affected certain industries such as mining, car production, legal services.
The figure reveals considerable variation in industry labor share changes, with the largest declines taking place in mining, chemical products, petroleum, primary metals, motor vehicles, computers and electronics, computer services, and legal services. There is also a strong correlation between the light gray (blue) and the dark gray (orange) bars, indicating that industries with the largest labor share declines are those that have been at the forefront of automation technology adoption. Industries most affected by automation are consequently similar to those listed above and include motor vehicles, primary metals, computers and electronics, computer services, plastic and rubber products, and legal services.
As for other causes, including globalization ("import competiton" and "offshoring"), they say...
Table A-I also confirms that the inclusion of changes in total capital to value added ratio, sales concentration, markups, import competition, and unionization rates does not change the correlation between our proxies of automation and industry labor share changes.
Our reduced-form evidence is based on estimating this equation and reveals a number of striking new facts. Most notably, we documented that 50–70% of the changes in the U.S. wage structure between 1980 and 2016 are accounted for by the relative wage declines of worker groups specialized in routine tasks in industries experiencing rapid automation. We also verified that our task displacement variable captures the effects of automation technologies (and to a lesser degree offshoring) rather than changes in overall capital intensity, other types of technologies, markups, industry concentration, unionization, or Chinese import competition. These alternative economic trends do not appear to play a major role in the evolution of the U.S. wage structure between 1980 and 2016 and have negligible effects on our estimates.
I still think that in 1950 to 1980 we had different responses to task displacement and the change in wealth distribution it might have caused.
For example, if you look at their list of industries with high task displacement, they tend to be in industries we think of as having "high-paying manufacturing jobs" (and I'm folding mining into that).
But there was nothing inherent in the order of the universe stating that manufacturing or mining jobs would pay a solid middle-class wage. In the first century or so of factory work, in fact, they were decidedly low-wage jobs with horrible conditions as they are in many countries today. We decided as a society, through conflict, sometimes bloody (see
Haymarket Affair) that we simply believed that people in those jobs should have a living wage.
Mining might be the extreme example, but those "good jobs" that West Virginians so desperately want to defend today, were once terrible jobs that became high wage through essentially open warfare - gunfights, murders, hired thugs and so forth. In the 1959 UMW strike,
A local union representative fired back, saying that miners weren’t “striking for a $2 wage, but for a $20 wage over the $4 a day they’re now getting,”
https://en.wikipedia.org/wiki/Coal_Warshttps://en.wikipedia.org/wiki/Harlan_County_Warhttps://en.wikipedia.org/wiki/1959_United_Mine_Workers_strikehttps://en.wikipedia.org/wiki/Battle_of_Blair_Mountainhttps://en.wikipedia.org/wiki/Roving_Picket_MovementAfter enough conflict and struggle, we finally decided as a society that the miners were the good guys and that we were willing to pay more for energy to see them have a living wage. Now, it may be that we were willing to do so precisely because bigger trucks and more capable machinery was increasing productivity, so we didn't feel the pinch as the labor component of coal prices declined even as wages rose.
I don't know about that. But there is nothing inherent in the structure of the universe stating that a miner should make more than a meat packer or an airport courtesy shuttle driver or a rooms cleaner or Starbucks barista or a line cook or a dishwasher other than that collectively, after enough bloodshed, we decided miners should be paid more.
Anyway, all that to say that capital is always looking for ways to hold down wages, be it automation or industrialization or differential tax rates on capital gains vs wages. It doesn't happen because those things happen, it happens because we decide as a society that we will organize along these lines and value certain things over others.
