Fighting The Future: Teamsters Demand UPS Ban Drones And Autonomous Vehicles
from the giving-unions-a-bad-name dept
As I've occasionally mentioned in the past, my undergraduate studies were in (of all things) "industrial and labor relations," which involved many, many courses of study on the history of unions, collective bargaining and the economics around such things. I tend to have a fairly nuanced view of unionizing that I won't get into here, other than to note that a big part of the reasons why unions get a bad name is when they take indefensible positions that they think will "protect" their members, but which actually are long term suicidal. This is one of those stories. Reports are coming out that as the Teamsters are entering negotiations on a new contract with shipping giant UPS, their demands include a ban on both drone deliveries and on the use of autonomous vehicles. These are, not surprisingly, both technologies that UPS has been experimenting with lately (as has nearly every other delivery company).
You can understand the short term thinking here, of course, UPS drivers see both of those options as potential "competition" that would decrease the number of drivers and potentially cause many to lose their jobs. And that might be true (though, it also might not be true as we'll discuss below). But, at the very least, demanding that the company that employs you directly choose not to invest in the technologies of the future is demanding that a company commit suicide -- in which case all those jobs for drivers would likely be eliminated anyway. While there are obviously a lot more variables at work here, it's not hard to see how a competing delivery company -- whether Fedex, the US Postal Service, Amazon or someone else entirely -- could get drone/driverless car delivery right, and suddenly UPS's service is seen as slower, more expensive and less efficient in many cases. If that's the case, UPS would likely have to layoff tons of workers anyway.
The other key point: the idea that these technologies are simply going to destroy all the jobs is almost certainly highly overstated. They very likely will change the nature of jobs, but not eliminate them. Professor James Bessen has been doing lots of research on this for years, and has found that in areas of heavy automation, jobs often increase (though they may be changed). That links to an academic paper he wrote, but he also wrote a more general audience targeted piece for the Atlantic on what he calls the automation paradox. As Bessen explains:
Automation reduces the cost of a product or service, and lower prices tend to attract more customers. Software made it cheaper and faster to trawl through legal documents, so law firms searched more documents and judges allowed more and more-expansive discovery requests. Likewise, ATMs made it cheaper to operate bank branches, so banks dramatically increased their number of offices. So when demand increases enough in response to lower prices, employment goes up with automation, not down. And this is what has been happening with computer automation overall during the last three decades. It’s also what happened during the Industrial Revolution when automation in textiles, steel-making, and a whole range of other industries led to a major increase in manufacturing jobs.
He does note that the nature of many jobs can change, and also recognizes that just because this has happened in most industries in the past it doesn't necessarily mean the same thing will happen in the future.
But, if we were to game out the scenarios here, which one makes more sense? As explained above, forcing UPS to put a complete ban on these technologies will be devastating for the company and the people it employs should the technology take off. If, instead, as Bessen suggests, jobs change and demand increases, then wouldn't the union's membership be much better served by working with the company together on a program that enables the experimentation and deployment of these technologies combined with programs to help its current workforce transition into new or related jobs around the likely increased demand for shipping? Even if we see the worst case scenario that the union clearly believes, of drones/autonomous vehicles destroying jobs -- as already discussed that will happen anyway if the Teamsters ban UPS from innovating while their competitors do.
This is, yet again, an example of short term thinking on the part of the union, and a near total lack of strategic vision for what will best serve membership in the long term. It is focused on pretending the future doesn't exist, and if everyone just covers their eyes and ears and pretends these technologies don't exist, they somehow, magically, won't change the market. If I were a member of the Teamsters I'd be quite angry at this kind of short-term, destructive thinking by my union, rather than being forward-looking and aiming for solutions that will actually help the members in the long run.
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Filed Under: adapting, autonomous vehicles, competition, drones, future, innovation, teamsters, unions
Companies: teamsters, ups
Reader Comments
The First Word
“Is Professor Bessen unaware of the Jevons Paradox? This is simply another manifestation of that broader principle.
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Short Sighted
The question I have is that corporations do so with the impetus of Wall Street, what are the Teamsters excuses?
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Looking at you, police unions.
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Short-sighted, but...
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Re:
There's also a push to have deliveries made you your local supermarket, department store, etc., for later pickup. No more having packages lifted off your front doorstep.
Either way, fewer truckers and drivers.
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Two things
First, consolidation and monopolization negatively affect two groups of people - consumers AND employees. While anti-trust laws can offset the damage to consumers, the only protection for employees against the negative effects of having only one potential employer for your skillset is unions. The alternative is regulation so heavy handed that even someone like me, who generally favors regulations, couldn't support it. In short, the problem with the Teamsters is the Teamsters. Unions, as a whole, are a good thing in concept, and a net positive in practice.
Second, I want to call attention to one key part of Bessen's argument. "So when demand increases enough in response to lower prices, ..." This is why his argument simply does not apply to certain sectors, including trucking. The implication is that demand will increase for trucking services if the price of trucking decreases due to automation. Except it won't. People already have to move X tons of product Y miles in Z days. The price is the price and people will naturally try to find the lowest price they can, however there is zero reason to think people will magically start shipping more products around if the price of said shipping falls.
This argument MIGHT apply to Amazon, if the vast majority of products ordered through Amazon weren't from Prime members who will see no decrease in shipping costs anyway because the cost to them is already zero. For more traditional trucking companies, which no doubt comprises the majority of the Teamsters' membership, price will have zero effect on the demand for their services.
The same can be seen in other industries too. Note the coal mining industry. Demand has not increased over the past 20-30 years, even as automation has slashed the workforce to a fraction of what it once was. This is why Trump's claim that he's going to bring back coal jobs is such a fallacy - nothing he can do will increase demand, because nothing ANYONE can do will EVER increase demand for coal. It's a dying fuel that is no longer the cheapest option, no matter how cheap they make it. No amount of repealing safety and environmental regulations will ever cause the remaining coal-fired power plants to increase the amount they purchase from coal mines. It may kill us all, but it won't create a single job.
Other examples are plentiful. When is the last time anyone bought a Hummer? Do you believe that lowering the initial purchase price will cause a massive surge in H2 purchases? Or could it just be that nobody can afford to take a Hummer, even for free, due to the low MPG that no amount of automation can offset? Even if it did, would this surge be sustainable? Enough to hire and keep a thousand new employees? I highly doubt it.
I could go on but I'll stop here. ATMs and Software are excellent examples of where Bessen's theory works. And yes, in certain industries, it DOES work. But we cannot build a functioning economy on those industries alone, so don't take his work as gospel, because it isn't.
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Good Try Teamsters
Up next: the new robot tax will replace income tax; electric car and solar panel incentives will become taxes. The gubment will get paid always/anyways.
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The Shape of Things to Come
The FBI will demand encryption backdoors on the vehicles and drones, to check for contraband and terrorism. That backdoor will eventually be leaked. Hackers will gain control of grocery delivery fleets, in the air and on the ground.
It'll be the best damned food fight EVER!
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Re: The Shape of Things to Come
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Re: Short-sighted, but...
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Technology is moving forward, and UPS and FedEx have already figured out how to lower costs by leveraging the post office without using automated trucks (and that won't stop). Now just imagine UPS giving the Teamsters the middle finger, and using automated trucks, unloaded by USPS employees at post offices for USPS "last-mile" delivery. The Teamsters fighting this, rather than helping the transition and saving jobs in the process, will only result in the workers to be cut out of the equation as much as possible.
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Re: Two things
a) The cost of shipping is paid by *someone*, whether directly or indirectly (amazon prime only *looks* free, TANSTAAFL), and the automation in place now has lead to *a lot* more individualized shipments than their used to be. And yes, drop boxes in the supermarket for the last few miles *are* an option, and, if it's high value, I can already sign for it at the UPS depot.
b) Coal. The real purpose of most coal is to burn and use the energy somehow, and the cost of the various substitutes has been dropping *faster* than the cost of coal, and that's before we talk about displaced costs such as pollution, disease, and global warming. (There's also "mettalurgical" coal and coal tar, which are used in as chemicals)
But the problem of displacing the stereotypical (and possibly now nonexistent) teamster that barely graduated from high school with someone that can work at a much higher level is real, and has been going on for many years. Perhaps we need to ban hand trucks? lol
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Re: Re: Short-sighted, but...
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Programmers as union members?
I had to be a part of IBEW to work in the park at the power plant but not install on equipment testing transformer dissolved gas analysis at the same powerplant.
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Wagon Wheel Union gots yer backs!
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Re: Two things
You are making a fundamental mistake: you are confusing an entire market with a particular product in another market. Automation in the transportation market will lower the cost of other commodities dependent on transportation, and the classic supply/demand economic curves will apply as the cost of supply curve shifts downward. Do a thought experiment: if the cost of a commodity, say fresh fruit in Winter shipped from South America, were to drop in price by half because the transportation cost to bring them to your supermarket dropped, you would expect higher demand as more people consume more of the commodity. That will lead to increased demand for transportation. For consumers, there is very little demand for raw "shipping," it is more a cost of doing business that adds to the final price of a delivered product.
Your counterexamples of particular products - commodities - within a market, for example an H2 Hummer, fail because they have direct substitutes in that market. It's not that demand for automobiles has just dried up: other vehicles sell better than the H2 - much like the Aztech, there are few buyers for this particular product because buyers favor other substitutes. The same is true about coal: natural gas and renewables are direct substitutes as energy sources that are net cheaper per unit of energy and easier to transport. Their energy costs have dropped faster than coal's, so demand for them has increased while coal's has decreased.
I'm not even an economist and I can refute your arguments.
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Re: Wagon Wheel Union gots yer backs!
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Not until...
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Let's Consider the Following
Drones? Too many airspace restrictions. Even if exceptions are made for aerial drone delivery there will be years of red tape and lawsuits to overcome.
These people really don't look very far ahead do they?
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Re: Short-sighted, but...
I don't think we can win here. Paying people to do now-unnecessary jobs wouldn't be any better.
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Re: Let's Consider the Following
Well, sure. But that ten years started a few years ago.
Even if it's another ten years until fully autonomous vehicles, it'll be over quickly. If they're going to fight it, they won't want to wait until the autonomous trucks are on the lot.
The FAA already publishes a database of airspace restrictions. Drones from manufacturers like DJI already import and honor it.
It will however prevent drone deliveries to those living near airports. And in Washington DC.
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Is Professor Bessen unaware of the Jevons Paradox? This is simply another manifestation of that broader principle.
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"Robots Will Soon Be Punishing Humans: Ford Files Patent For Robotic Police Cars"
Enjoy your new Automobile Overlords.
Or do you now see why the union is alarmed?
No? Entirely different? -- I bet that you too will soon be victim of "technology" controlled by corporations.
BTW: isn't it amazing that Masnick knows all the nuances of Labor without ever having labored? Explains his appeal to those 27 Bangladeshi a day. -- His one known employment was at a doomed start-up. Certainly any start-up that hires an "economist" before has a product is doomed.
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Re: Re: Wagon Wheel Union gots yer backs!
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However, that also means that the takeaway we get from automation is that there is a limit we need to impose on automation before the downsides (to keep with the traffic idea, massively increased traffic that city streets and environmental protections can't cope with) overtake the upshots (more people on the road unimpeded). What is that limit? I guess that's the million dollar question.
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Re: "Robots Will Soon Be Punishing Humans: Ford Files Patent For Robotic Police Cars"
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Re: "Robots Will Soon Be Punishing Humans: Ford Files Patent For Robotic Police Cars"
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Nope. They are not. With public education funding being cut constantly, for-profit schools now trying to break into the K-12 market (yes, market), prioritizing of extra-curricular activities over education, bastardizations of the curriculum being made for political correctness or religion, artificially limited avaiablity, insane teacher qualification requirements, low return on investment (see also the worth of your bachelor's degree in ten years), and a corrupt all liability on the student college model, the current systems can't support anything without massive reforms. Sadly, those reforms are years away, if not decades, due to the general population's additude towards education.
See the first answer, No they are not. Especially with the number of people this particular automation will affect. It's not just the truckers facing unemployment, it's also the workers of their supporting industries. Many places along side the interstates (food service, hotels, gas stations, etc.) are all at risk here. Many of them will go out of business due to the decrease in customers. Worse, some areas only exist because of their location between major cities. Those areas are at risk of becoming ghost towns because they get most of their income from the interstate traffic, and the people there may not have the resources to move to job-plentiful areas, or pay for more education. In short this change runs a real risk of massive social unrest due to the sheer number of people it can potentially unemploy.
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Autonomous delivery - How will the vehicle deliver a package if nobody is home? I have this hilarious image in my head of the truck pulling up in front of a house and then firing the packages out the side like a potato cannon, with the packages smashing against doors, going through windows and knocking the intended recipient on their ass when they open the door to receive said packages.
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Why does anyone care about drones?
There all problems in the intertube 2 or is it 3.0 solved, stop spying for profit, that all you have to do.
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Re: Drone and autonomous delivery
As to autonomous delivery...well, in my area, we could have autonomous garbage trucks...as it is, a robotic arm reaches out, grabs the can, and dumps it, and I return at the end of the day to put the can away. Drop boxes are already starting to appear for the purpose; Amazon has them in Whole Foods now. Also, there's no reason a robot couldn't ask for ID or a password before giving me my package, too..like at an ATM.
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Btw, my favorite story about Jevons (the guy) was that when he died, they found a room in his house that was stacked floor to ceiling with paper. He was sure that the world was about to run out of paper, and he didn't want to be without paper...
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Re: Programmers as union members?
I generally see them as a net good but they don't do themselves any favours when they get all protectionist.
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Re: Re: Re:
Deciding the disappearance of a community that is basically a glorified interstate truck stop is a value-laden judgement that I invite you to study more closely to bring out what it is you really value. Likewise, pre-emptive action, without specifics or consideration of alternatives is also value-laden and needs some more thinking.
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Re: Re: Two things
Bessen's argument is that lower prices will increase demand. I do not disagree that automation will increase the profits of shipping companies, but it will do >>>NOTHING<<< to increase the DEMAND for those services.
This is just like Coal and it's funny to see people try to argue it isn't. The Coal industry has seen record profits in the last few years despite decreased demand. Why? It's not like they can charge more for coal and people will actually still buy it. Rather, it's because automation lowers costs. That's half of the equation for profit, yanno - sale price minus costs equals profit. If you can't increase the price, you lower the costs, and automation does that wonderfully.
But from the standpoint of the unions, they're still out of a job, and either way, the demand for the product did NOT increase due to automation, it merely lowered the costs and thus increased profits without actually changing demand.
Why would you think "demand" and "profit" mean the same thing? Or did you just not read what Bessen said, which is what I was responding to?
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Re: Re: Re: Two things
Again, since that's the argument here, it helps to state it properly. And my counter is very, very simple: automation > lower prices > increased demand is a fallacy in certain industries. You can say it's because of substitutable goods, but that doesn't change the fact that automation does NOT always lead to increased jobs, which was the point I was making. Nothing you said refutes that.
Note to self: I really should bother to figure out my old login, heh.
And guess what? I'm not an economist either, but I don't have to be to see you're sidestepping my argument because you can't actually disprove it.
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I am waiting
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Is that documented? Because it kind of sounds like the best kind of urban legend? (Which would just make it funnier if it were actually true...)
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They've had their place, but they then take things way to far as they get more and more greedy. Unions sure don't have a place in GOVERNMENT jobs. Remember in the past when taking a Government job meant low pay buy good Benefits. The UNIONS came along, Pay shot way up. Benefits shot up even better, to the point where City's are becoming bankrupt. Wondering how they are going to pay for all this crap. It's the Taxpayers stuck with the bill in the end.
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Re: Short-sighted, but...
The same has happened to every other job for which automation was introduced. The sky is not falling.
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I guess you long for the coal Barron days of the Molly MaGuires? Never had an overworked under-payed shitty job?
I say good for the Teamsters. They are doing what their members expect them to do, save their jobs.
Because... ya know... corporations don't make enough already they need tax breaks and autonomous shit to reduce the workforce even further.
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Re: Re: Programmers as union members?
This is sad too, to see Masnick push some trickle down econ bs.
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Re: The Shape of Things to Come
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I agree, but...
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Re: Re: Re: Programmers as union members?
I'm starting to think the Mike and you are daft. A union by definition is protectionist.
No. It's not. Some, perhaps most, have become so. But that is not the basis of a union. It came about to create collective bargaining, which can make a lot of sense for workers who have little leverage against an employer. Bargaining collectively to level the playing field can be a good idea in certain circumstances. That does not need to be protectionist by any means.
This is sad too, to see Masnick push some trickle down econ bs.
Where did I do this?
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Re: Re: Re: Re: Programmers as union members?
What Mike says. Unions gave us many benefits.
They still do and we still need them because getting rid of them brings back all the abuses of the past.
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