Uber’s CEO doesn’t think self-driving cars will cost jobs, and he might be right

When Uber announced Thursday that it would begin offering rides in self-driving cars to customers in Pittsburgh, it caused a lot of consternation among people worried about job losses. After all, sharing economy companies like Uber are supposed to represent one of the economy’s big sources of job growth. If even Uber is automating its fleet, doesn’t that mean workers are doomed?

But in an interview with Business Insider, Uber CEO Travis Kalanick argues that Uber drivers shouldn’t worry. He expects to continue offering work to drivers for a long time:

If you’re talking about a city like San Francisco or the Bay Area generally, we have, like, 30,000 active drivers. We are going to go from 30,000 to, let’s say, hypothetically, a million cars, right? But when you go to a million cars, you’re still going to need a human-driven parallel, or hybrid. And the reason why is because there are just places that autonomous cars are just not going to be able to go or conditions they’re not going to be able to handle. And even though it is going to be a smaller percentage of the whole, I can imagine 50,000 to 100,000 drivers, human drivers, alongside a million-car network. So I don’t think the number of human drivers will go down anytime soon.

Obviously, Kalanick has an interest in putting a positive spin on this since he depends on Uber drivers to make the service operate today. But his argument isn’t crazy. Similar things have happened in other industries.

For example, when automated teller machines were developed, many people thought ATMs would put most bank tellers out of work. But that didn’t happen. ATMs made it cheaper to open a bank branch, allowing banks to open many more branches in the 1990s. As a result, teller employment has actually grown slightly over the last 40 years, as this chart from economist James Bessen shows:

The same logic could apply to the car market. If self-driving cars make taxi rides a lot cheaper, people will take a lot more taxi rides. And that could create more jobs even if the number of jobs per ride goes down. In the long run, there won’t be someone sitting in the driver’s seat, but there will be lots of other jobs supporting cars — things like maintaining, repairing, and cleaning the vehicles, handling customer service calls, keeping maps updated, and so forth.

Some jobs will be destroyed; others will be created. The net impact on the job market isn’t obvious.

Correction: I originally said that the number of bank tellers had declined after 2008, but better data shows employment rising.