Over time, the industrial landscape for any economy will change significantly. In the graph below, we show the share of Louisville (Jefferson County) jobs by each sector of the economy between the years 1850 and 2017. There has been tremendous growth over the past 170 years in the service sector of the economy. Today, service industries combined account for 47% of Louisville’s employment, compared to only 17% in 1850. Manufacturing has always been an important part of the industrial base in Louisville. It declined from 24% of employment in 1850 to only 12% percent of employment today. Automation and technological advances are likely responsible for the reduced share of employment.
As we ponder what the jobs of the future might look like, it is essential to remember that the economy is constantly changing. While agriculture, mining, and manufacturing were once dominant industries, technology replaced many of the tasks required to perform those jobs. While technology disrupted those sectors of the economy, new jobs in other sectors were created and employment continued to grow. However, those new jobs tended to favor better educated and more highly skilled workers.
While it is difficult to predict the future, we can take some comfort in the past. Our economy is resilient and has faced disruption before. Automation should not be viewed as something to be feared, but rather an opportunity to propel ourselves forward.