43  12  All speeches are available online at www.bankofengland.co.uk/speeches  12  Typically, the two sides of this argument are taken to be in a secular struggle: the dark forces of secular stagnation pitted against the dynamic forces of secular innovation. Yet in practice, both arguments have merit. They are certainly not mutually incompatible. It is perfectly possible to imagine a world of rapid innovation which nonetheless leaves large swathes of society in its slipstream. More than that, recent research suggests this is a likely outcome of the Fourth Industrial Revolution. There are good conceptual grounds for thinking the displacement effects of the Fourth Industrial Revolution may be larger than ever-previously. Every industrial revolution has resulted in a hollowing-out, typically of mid-skilled tasks. Historically, that has meant largely manual, labour-intensive tasks. Machine has replaced human in activities that are routine and repetitive. The future could well be very different. For example, the dawning of AI means that humans will no longer having the cognitive playing field to themselves. Thinking or non-routine tasks may increasingly be taken up by machines. They will be able to process more quickly, more cheaply and with fewer errors than their human counterpart, at least in some activities. That could make the hollowing-out of human tasks, now cognitive as well as manual, far greater than ever before. 48  A cottage industry has emerged over recent years manufacturing estimates of job loss that might result from 49  this rise of the robots.
However, to optimise its benefits objectively, we need to overcome four clichés. I shall then turn to your banking industry and its three key challenges for tomorrow. ** I. Overcoming four clichés in order to optimise the euro area. I am fully aware of the criticisms and debates that exist here in Germany about the functioning of the euro area. Not everything is perfect; but Germany can be proud of having helped to create an internationally recognised currency inspired by its own core values: independence, respect for Treaties, price stability and a long-term approach. The ECB and the euro are the true descendants of the Bundesbank and Deutsche Mark. But today, if we want to move forward with a serene debate, we need to get rid of four clichés. Page 2 sur 7 The first one that needs to be overcome, including by some in my own country, is the somewhat lazy idea that economic union is a substitute for national reforms. I want to make this clear from the start: on the contrary, national reforms are a prerequisite for reinforcing the economic union. I am saying this as a completely independent central banker; the current French government is taking reforms very seriously. France has already reaped the first rewards: strong job creation – 1 million new jobs in the past four years – is lowering unemployment; growth – forecast at 1.3% this year – is proving more resilient than in the rest of the euro area.