Job Cuts for Australian Train Drivers

by Matthew Pellicer on October 2, 2013 - 11:29am

http://www.montrealgazette.com/business/Tinto+replace+train+drivers+with+robots/8987076/story.html

In Australia, the average train driver earns about A$240,000 per year. This is more than the average surgeon in the U.S. It is just normal for a company, that when they try to cut down costs, start by cutting the highest paid ones.

Rio Tinto found a solution they think they are able to implement by 2015. This solution is automated trains. This is great for the advancement of technology but not so great economically. As people lose their jobs as train drivers in Australia, slowly other companies are going to want to have access to these automated trains as it reduces costs on a long term basis. This means that slowly all the engineers that only ever drove trains in their lives, can’t find another job as they don’t exist anymore. This would lead to a larger amount of people being unemployed and this then causes less purchasing from the overall population. Although salaries at Rio might go slightly up because of the increase in profit it wouldn’t be enough to compensate for all the train engineers losing their jobs.

As with everything, this project has pros and cons and I believe economically on a short term view, it isn’t the best but it can lead to new technologies opening up new jobs and causing some good if we look further into the future.

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