I was working for the old AT&T/Ma Bell back when the changeover from dial to "touchtone" began (yes, I'm well-aware it was a very long time ago).
It wasn't only the phone dials that were full of gears, but the central offices worked on the old "step" system - rotary switches by the thousands having to rotate, move, make connections to other switches every time some one picked up a phone. When you dialed, as your dial clicked and returned, these office switches were also clicking up, down, or over in response to your dial. This took many, many employees just to keep these mechanical switches working correctly - a never-ending task. However, the old offices, which were everywhere, would not work with the tone pulses sent out by the new TT phones (there were some temp. fixes possible during the changeover of offices, sort of). Regardless, the phone company Central Offices were all eventually cut over at first to what I believe were called "Crossbar" offices. As more and more were switched over, there was less and less need for men to do the work. In the small town of Moraga, California, there were, at one time, two full-time employees just running wires and maintaining the electro-mechanical switches - after the cutover, there were none; it was handled remotely. Eventually, it was all solid state, all done remotely from centralized computers.
One other thing - at first, if you wanted to change over to push button, you not only paid a service fee to change, but you also paid a monthly fee for having this fancy new style of phone.
There WERE people like my mother - she absolutely refused to get a "push-button" phone, and kept her old black rotary dial wall phone until the day she died.