How Electronic Banking is Affecting America's Jobs

03.05.08 | Online Banking | 0 Comments | by Fred Siegmund

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There was a time when people saved at banks, savings and loans and credit unions … and that was about it.

People still do, but our federal government defines banks, savings and loans and credit unions as part of a much bigger group of establishments called credit intermediaries that do financial intermediation.

Savings is not as simple as it used to be, but jobs in intermediation still have most of the same titles, including 558,000 jobs as tellers.

Tellers are an important job to watch. Office automation could just about eliminate teller jobs or knock them out of the whole economy (like cars knocked out horses in my grandfather's day).

Money machines eliminate the need for tellers for check cashing and other basic banking transactions. Writing paper checks requires an elaborate process of handling, posting and clearance that takes much longer and requires more labor than electronic processing at the point of sale.

Today's digital technology basically eliminates check writing, paper and even currency. However, teller jobs are not decreasing — they've actually been increasing modestly in the last few years.

Our happiness with these teller jobs has to be modest, because the median annual salary rings in at $21,300, but their continued growth shows America's resistance to further changing to electronic money.

With broadband Internet connections in more and more homes, some people are comfortable with their money literally flying through the air. Perhaps paper gives comfort to others.

Whatever the reason, America's refusal to eliminate checks and currency supports many more jobs than technology requires.

We know that increasing productivity makes manufacturing more efficient, but it continues to eliminate jobs. In a digital world, finance and insurance also have room for more efficiency. The number of teller jobs means that more efficiency could affect things.

Efficiency sounds so much like something we should like, but if efficiency keeps eliminating jobs, maybe we should begin to feel differently.

If more Americans would like things that are inefficient, we would have more jobs, but if America wants efficiency, they may have to think of shorter hours or new ways to spread the work.

Fred Siegmund covers America's jobs as part of work doing labor market analysis and projections for a client base of recruiters, trainers and counselors. Visit him at

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