Is Innovation Leading to Higher Unemployment?

Technology entrepreneurs love to talk about disruption while simultaneously touting themselves as job creators, but the two roles are often contradictory.

By definition, disruptive innovations are characterized by a streamlining of process or product that is more efficient. Typically, the inefficiencies removed from the incumbent system result in less required labor. Less labor means fewer jobs.

Consider Amazon. For all the jobs created by Amazon’s online sales model, I suspect there were significantly more jobs lost at Borders, Barnes and Noble, and the countless smaller bookstores that closed their doors across the nation.

Of course, disruption has always been a part of business, but I believe the exponential increase in computing power along with the rise of the Internet have brought us to a unique turning point.

Instead of the normal evolutionary rise and fall of industries, our economy is now at something analogous to the Cretaceous-Tertiary extinction event (the end of the dinosaurs). Going forward, those who will prosper will be characterized by their ability to leverage technology, while everyone else will find themselves relegated to obsolescence by exponentially more powerful machines.

Read the rest of this article at Venture Beat

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