Is bitcoin disruptive? You bet, enough so that eventually it might displace some jobs.
Just like the industrial revolution changed how things were made and the digital revolution displaced lots of clerical work, distributed money could automate a number of processes that currently require people.
That can be considered a scary thought, but bitcoin represents technological progression, which as history has proven pretty much always wins out versus any sort of old manual process.
So, what are the types of jobs that might be threatened by digital currencies? Let’s take a look.
It’s no wonder banks are incredibly inflexible in their policies regarding bitcoin. The modern banker (not the investment sort) is, by his or her nature, adverse to risk.
Bitcoin represents perhaps the most risky asset since the days of trading in tulips. Yes, this is in reference to “Tulip Mania” back in 1637, when the price of the flower grew to an outrageous valuation.
Another reason bankers might not like bitcoin is that its nature doesn’t require as much human interaction as fiat currency does.
Bitcoin and other virtual currencies allow monetary values to move faster and require less friction. Replace the word “friction” with “bankers” in the last sentence, and you might see that the two words are pretty much interchangeable.
There are probably fewer days ahead of than there are behind a person taking physical (or perhaps even fiat) money and making exact change for people. Part of this has to do with the advent of new technologies such as ATMs.
Another element is that everyone increasingly uses plastic cards to pay for things. Do you know someone who never carries cash? Is that person you?
Commerce has made this possible for us. New devices like smartphones make paying for goods and services a much more simplistic process than ever before, eliminating the need for cashiers. These employees are only needed for complex tasks, and at that point it’s hard to argue that they would be called cashiers anymore.
Armored car guards
Did you know that the Treasurer of the United States printed a $100,000 note from 1934-35?
The reason for it was to move large amounts of gold-backed money around the Federal Reserve System. According to the Treasury: “Neither the Department of the Treasury nor the Federal Reserve System has any plans to change the denominations in use today.”
They don’t need to, because electronic forms of money are overtaking the need to move physical money around, which lessens the need for the job of an armored car guard.
Sure, these hardworking people will still be around to transport valuable items such as gold or priceless art, but they will be in less demand as paper money declines and doesn’t need as much costly transportation.
The field of accounting is a respectable vocation. Many people know an accountant, and a number of businesspeople even employ one of their own.
But what is the role of an accountant going to be when decentralized virtual currencies can automate accounting functions such as a general ledger? The block chain appears to be doing this job just fine for bitcoin, and no certified public accounts required.
The explosion of accounting software to automate many financial tasks over the past two decades has, in some respects, lessened the role of accountants already.
It’s relegated the profession to more specialization in areas like taxation. And while the extinction of the accounting profession isn’t likely, let’s hope that it doesn’t adopt money laundering as one of its specialties if business does someday decline.
What else does the future hold?
The Bureau of Labor Statistics (BLS) reports that from 2010-2020, there will be a projected 0.7% increase in the US civilian labor force, which means 10.5m additional jobs will be created by 2020. That’s good, given the recent struggles that many Americans have faced finding work.
However, if you believe bitcoin will not at least displace some workers, think again. The same BLS report that forecasts job growth also points out areas of decline. One of these is in postal services, a field that is expected to decline by 48.5% from 2010-2020.
This seems logical on the surface, but think about what has displaced postal service workers: email.
Virtual currencies like bitcoin are replacement for paper money; much in the way electronic messaging has decimated the need for paper-based messaging.
And that’s just one component of postal mail’s decline. Think of the jobs that were based just on postal mail thirty years ago (company mail departments, mail-order catalogs, etc), and how much of that has dissipated.
The concept of bitcoin-type electronic money may ultimately disrupt industries the same way as email already has.