Big Tech Has Failed to Live Up to Its Promise

It’s tempting to dismiss the mass layoffs and collapsing stock prices in the tech sector as just another blip in the tech boom-and-bust cycle. Technology firms may make up 36% of the S&P 500, but they represent only 0.3% of workers. These are mostly highly skilled people who will probably find other jobs quickly, so there is reason to hope that this is a necessary correction to an overinflated sector of the economy and that right-sizing won’t cause wider damage.

But the fact that productivity in the US is also falling is worth noting, and suggests that what’s happening in tech could mean something much deeper is wrong.

The tech economy has yet to live up to its promise. Earlier bursts of technology changed lives: Indoor plumbing is pretty amazing, and so was electricity, the power loom and the telegraph! These not only transformed the human experience, increased living standards and freed us from hard labor, they brought unprecedented gains in productivity and wealth.