Humans need not apply: The future of jobs is robot-shaped

There are bright spots on the jobs front – new figures out last week showed the number of unemployed people fell to a six year low, those claiming Jobseeker's Allowance are down to a million while the number of self-employed shot up. Sounds good?

Think again. The job growth fuelling the recovery is tilted in one direction – towards low-wage industries that pay minimum wages, some with little or no benefits, and many of which are part-time. Many of the former middle-class jobs have gone forever – relics of yesterday's economy.

If you want to see why this is going to get worse, watch a terrifying new video out last week by C G P Grey, a YouTube poster who publishes educational films, entitled Humans Need Not Apply. The film has only been up for a few days yet there have been more than one million views: no surprise there.

Grey predicts that there are hundreds of millions more jobs yet to be taken over by the "bots" – the new generation of robots. Just as mechanical muscles (ploughs, tractors, diggers, and so on) made human labour less in demand, so the mechanical minds being built will have the same effect on human "brain labour".

The reason? It's economics, sadly. The first generation of computers in the 1980s were expensive and did only simple, mechanical tasks. Now the new Baxter and Watson "bots" are programmed to do anything from booking aeroplane seats to driving cars, and they are as cheap as chips compared to their human equivalent. Even if the bots take longer than humans to do the job, they are about a hundredth of salary costs. That's why he believes the transport industry will be hit the hardest and quickest by driverless cars as it's such a big employer – there are three million car-related jobs in the US and around 70 million across the world.

By the way, Grey says the film is not trying to scaremonger but simply to show us that automation is no longer the stuff of science fiction: robots are being used to replace nearly every human endeavour; in the US, Watson bots are doing complex cancer operations while Baxter can do what lawyers and doctors do, they make coffee as tasty as baristas, trade shares, make music and even write up sports reports.

He's not alone in his forecasts: McKinsey has issued a warning that up to 140 million upper middle-class jobs will be lost over the next 10 years, a blood-letting every bit as vicious as the mechanisations that destroyed first agricultural jobs and then factory ones. Grey points out, too, that there has only been one "new" job in the past 300 years – that of computer programmer. No wonder so many students are taking A-levels in the "harder" subjects such as maths and science.

There are good sides to the bots: driverless cars don't text or fall asleep so lives could be saved on the road, and bots are proving better than humans at diagnosing illness. Yet the irony is that bots only become clever because humans are getting cleverer at inputting new algorithms. But we need to be smarter still, finding ways that this third industrial revolution benefits us all, not just a few. If not, we will end up like horses, whose population peaked in 1915. Once used for work, they are ridden now mostly for pleasure or show.

He's betting on Ukip

Paul Sykes was in the jolliest of moods when I spoke to him yesterday after the news that Nigel Farage is going to take on South Thanet in next year's election. The Yorkshire businessman, and former Tory donor, is now Ukip's single biggest backer, having given another £1m to help to fight the general election.

Sykes says he expects many more Ukip politicians to follow Farage in finding seats and he'll be there to back them: "Farage is getting organised now and has raised the public's awareness of borderless Britain. Soon we can have a proper debate about exiting the EU."

He also says that he doesn't expect to stay Ukip's biggest backer for long: "Businessmen are queuing up to talk to Farage and I expect there's going to be a lot more funding over the next few months."

At the pensions barricade

Every small business owner I speak to is ready to take to the barricades. They are furious about the new pensions legislation coming into force the year after next. The new law says every company, big or small, must offer a pension scheme to their employees of 8 per cent of salary on top of the 12 per cent for National Insurance. Quite simply, this is going to drive many small companies out of business.

One brilliant architect I know, who runs a small practice of 12 people, says she will either have to cut salaries, not give her staff a raise or cut the number of employees to meet the extra costs. There are hundreds entrepreneurs like her, working on the edge.

As the UK's 4.8 million small businesses are the only source of new jobs, this new law is ludicrous. Of course, employees should be protected but surely it's for the owners to work out how best to do this. Like business rates, this is going to cost the Tories votes big-time.

Frumps on the high street

Ros Altmann, the Government's champion for older workers, is right; clothes on the high street for women of a certain age are ghastly. Look at the latest autumn range from Marks & Spencer: frumpy and boring. Ex-M&S boss Sir Stuart Rose used to say running the group was like running the NHS – everyone thinks they have the answer.

Well, I do: M&S should forget fashion – leave that to Zara and Asos – and be more like an upmarket Muji or Uniqlo, providing basics in every colour and shape. Marc Bolland, the current M&S boss, should invite Dr Altmann to sit on a new "peoples" panel choosing clothing: she's a ringer for Dynasty's Alexis, so that could be fun.

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