What Is Technological Unemployment?

Technical unemployment is unemployment caused by technological progress. In the course of economic growth, the inevitable trend of technological progress is that capital and technology-intensive technologies are more and more widely used in production, and more and more advanced equipment has replaced workers' labor. In this way, the relative reduction in labor demand will Increase unemployment. In addition, in the process of economic growth, the decline in the relative prices of capital goods and the relative rise in labor prices have also exacerbated the tendency of machines to replace workers, thereby increasing this unemployment. Those who belong to this type of unemployed are all those with low cultural and technical level and cannot adapt to the requirements of modern technology.

Technical unemployment

The theoretical analysis and

"Classical" economists believe that technological progress on the one hand destroys old jobs and on the other hand creates new employment opportunities, and accordingly proposes multiple compensation mechanisms, claiming that

Both "classical" and neo-classical compensation theories have been criticized by non-mainstream economists at both the micro and macro levels.

In the course of economic growth, the inevitable trend of technological progress is that capital and technology-intensive technologies are more and more widely used in production, and more and more advanced equipment has replaced workers' labor. In this way, the relative reduction in labor demand will Increase unemployment. In addition, in the process of economic growth, the decline in the relative price of this product and the relative rise in labor prices have also exacerbated the tendency of machines to replace workers, thereby aggravating this unemployment. Those who fall into this category of unemployed are all workers with low levels of culture and technology, who cannot meet the requirements of modern technology. Historical review The study of unemployment in mainstream economics has focused on the labor market. Different schools based on different assumptions about the labor market, and draw different conclusions, and pay little attention to factors outside the labor market, especially the impact of technological progress on employment. This is mainly due to the neglect of the factors of technological progress in the analysis of macroeconomics by the academic community in recent decades and the general respect for the general equilibrium thought. In the history of economic thought, the relationship between technological progress and employment has been fiercely debated since David Ricardo, especially in the 1930s and 1960s.