For the technology argument to work, wouldn’t we expect to see a big jump in productivity? (Productivity is growing but not at an abnormal rate)
Right, I probably shouldn’t have said “technology” because to economists this tends to refer to total factor productivity (i.e. the output you get per combination of labour and capital). Personally I’m super averse to discussing the whole concept of TFP, because it’s so hard to see what it actually corresponds to in the real world. (Macroeconomists call it technology, but it actually aggregates up a whole lot of institutional and regulatory and cultural and demographic and technological changes into one impossible-to-interpret number.)
The concept is more that the technology we’re using has shifted to requiring fewer workers doing stuff that’s routine but non-manually intensive and more workers doing stuff that’s either non-routine or manually-intensive or both. This is called “routine-biased technological change” and it’s pretty clear in the data. Like, the idea isn’t that production has suddenly gotten way more efficient; rather, the idea is that continued gains in production efficiency lately come from changes in the set of tasks that workers do. This working paper explains the concept in a relatively non-technical way. The abstract:
Job polarization refers to the recent disappearance of employment in occupations in the middle of the skill distribution. Jobless recoveries refers to the slow rebound in aggregate employment following recent recessions, despite recoveries in aggregate output. We show how these two phenomena are related. First, job polarization is not a gradual process; essentially all of the job loss in middle-skill occupations occurs in economic downturns. Second, jobless recoveries in the aggregate are accounted for by jobless recoveries in the middle-skill occupations that are disappearing.
So it’s a bit more of a subtle shift than the usual growth accounting measure of technology. I think it’s pretty persuasive but all my macro-level PhD courses were taught by people who think it’s pretty persuasive so probably there’s some bias here.