Dear Labor, Don’t Fear the Robot

In California, a war is quietly being fought: workers versus technology. And the war has materialized in the form of a bill that seeks to ban the sale of alcohol by automated checkout machines at grocery stores. You may have seen them, those machines that allow customers to scan and bag their own items, which can speed up the process and keep lines smaller. Those machines also allow grocery store owners to reduce their costs by employing fewer workers. Herein lays the problem: workers fear that they are slowly being replaced by machines and that increased reliance on automatic check out machines threatens their jobs.

The legislation, AB 183, would ban the sale of alcohol at self-checkout aisles. The bill’s proponents drag out the old “save the children” argument, claiming that minors can easily purchase alcohol without the human oversight a traditional checkout process offers. Of course, the robots aren’t completely automated and require a worker to authorize any purchase that contains an age-restricted item such as alcohol. Additionally, the numbers of “sales to a minor” violations submitted by the state’s alcohol control board seem to indicate that most of these sales do not occur at grocery stores, but rather at liquor stores and in restaurants.

Where Minors Actually Get Alcohol

According to a press release from the California Grocers Association, there were more than 2,000 citations filed by the Alcohol Control Board of California against businesses selling alcohol to minors, of which less than 7 percent were against grocery and big-box stores, and less than 4 percent were against the large chain supermarkets. A quick scan of the weekly citations, available on the ABC website, confirms that the majority of these citations are against bars, restaurants, and liquor stores.

Surprisingly, the way that most underage drinkers obtain alcohol is from their parents! According to a survey by the American Medical Association, a large percentage of teens report obtaining alcohol from their parents’ (with and without permission) and from their friends’ parents.

The Assembly heard all of these facts that disprove the minor-sales need for such a ban and yet they passed the bill and sent it to Senate, which will likely vote on the issue this week.

Obviously, the children are not the chief concern of the bill’s supporters, so what is? Fresh & Easy Neighborhood Market, which operates 127 stores in California, all of which are non-union, has asserted that the United Food and Commercial Workers union is pushing the bill as a way to pressure the company to recognize the union. According to those numbers cited by the grocers association, Fresh & Easy markets had just 2 citations of selling alcohol to minors between 2008 and 2011.

The Myth that Technology Destroys Jobs

While the labor union may fear that reliance on automated scanners puts their livelihood at risk, this is a mistaken belief. On the contrary, the increased use of automated processes allows owners to cut costs and hire more workers for other tasks and lower the prices of their goods for customers. George Mason University economics professor Russ Roberts, host of the fantastic EconTalk podcast, addressed this type of thinking in a Wall Street Journal article earlier this year:

The savings from higher productivity don’t just go to the owners of the textile factory or the mega hen house who now have lower costs of doing business. Lower costs don’t always mean higher profits. Or not for long. Those lower costs lead to lower prices as businesses compete with each other to appeal to consumers.

The result is a higher standard of living for consumers. The average worker has to work fewer and fewer hours to earn enough money to buy a dozen eggs or a pair of shoes or a flat-screen TV or a new car that’s safer and gets better mileage than the cars of yesteryear. That higher standard of living comes from technology. It isn’t just the rich who get cheaper TVs and cars, plus the convenience of using an ATM at midnight…

When it gets cheaper to make food and clothing, there are more resources and people available to create new products that didn’t exist before. Fifty years ago, the computer industry was tiny. It was able to expand because we no longer had to have so many workers connecting telephone calls. So many job descriptions exist today that didn’t even exist 15 or 20 years ago. That’s only possible when technology makes workers more productive.

California lawmakers would be wise to listen to Professor Roberts. The true way to create jobs, whether it’s for grocery store employees or any other type of worker, is to make the industry efficient, affordable, and profitable in order to sustain existing business and to motivate new employers to get into the market. In other words, markets need to be competitive. Lawmakers in the Golden State should stop trying to protect the jobs that exist and start looking for ways to help business owners stay competitive and profitable so that, among other things, they can create new jobs for California workers.