Automation Won’t Replace Humans — and That’s a Problem
BBC: Robots ‘to replace up to 20 million factory jobs’ by 2030
These are the kinds of headlines we see in the news from time to time. Yet even in the midst of the worst global pandemic in living memory, unemployment in most developed nations is below 8%, with countries like the UK, Germany, Australia, and Japan all having unemployment rates of less than 5%.
What’s even more surprising is that many industries like trucking, retail, and farming are all experiencing huge shortages in the number of people available for work.
So, what exactly is going on, and how can the reality be so much different from what experts have been predicting for decades? Will we ever see a day where humans don’t have to lift a finger to do anything, where all necessary jobs are done by machines run by artificial intelligence?
Well, in short no, it’s highly unlikely that will ever happen. In fact, over the last 20 years, it has been proven time and time again that automation isn’t something that replaces humans, it’s something that complements our existence. It boosts our efficiency and allows us to achieve more with less.
Less time, less energy, and in many cases less risk of injury to us.
Take car maker Tesla as an example. Its CEO, Elon Musk, has long been a proponent of incorporating robots into the production line. If robots can do everything humans can do, but many, many times faster, then why not just replace all the humans who are a drag on production?
Musk’s goal was a 20-fold increase in the production of the Model 3, aiming to produce 20,000 cars per month by the end of 2017. As you may recall, that didn’t happen.
In fact, instead of completing 20,000 in December 2017, Tesla was able to produce less than 2,500 Model 3’s in the entire final quarter of 2017.
After a record Q1 loss of $785 million dollars, Musk decided to backtrack by pulling his new robots off the line, and he began hiring hundreds of new workers every week to rescue production targets.
Musk even went so far as to tweet about it:
Sure, a fast-food chain like McDonald’s can purchase grills that will automatically cook hamburgers. They can also buy machines that will automatically cook fries based on pre-set conditions.
But can they buy a machine that will receive the delivery of those hamburgers and fries from suppliers? Can they buy a machine that will remove those fries from the fryer, perform a visual quality inspection to make sure they’re suitable for consumption, and then distribute them to individual containers?
And more importantly, does Mcdonald’s want to do that? How many billions of dollars would it cost to refit all 40,000 McDonalds restaurants worldwide?
The fact is humans are one of the most flexible forms of automation available to any employer. The goal of any business is ultimately to fulfill the wants and needs of humans, and who knows how to serve a human, better than another human?
In fact, a study done by consulting firm Oliver Wyman found that the factories with the most automation ranked not at the top for productivity, but at the bottom.
So this raises the question, what is the role of automation in the workplace, and how can we determine if a job is likely to be automated?
A study by Deloitte and The Manufacturing Institute found that if manufacturers can’t attract more workers, the US could have over 2 million unfilled manufacturing jobs by 2030. The cost of this shortfall is expected to hit $1 trillion dollars.
The hardest of these jobs to fill are those considered to be dangerous, those that involve tedious repetition, or are just generally unpleasant. In other words, perfect candidates for automation.
These are the kinds of positions that are often outsourced to less-developed nations — just look at the rise of China over the last 40 years to become the world’s largest manufacturer.
That happened simply because countries in regions like North America and Europe had jobs that they couldn’t fill with native workers, so China stepped in and said, “we’ll do it!” and they were happy to have the work.
In Ireland, where I’m from, there are certain industries like fruit picking that are carried out almost entirely by imported labour, mainly from countries in Eastern Europe & the Balkans. These workers come over to Ireland for the harvesting season and then return home after it’s done, as the demand simply cannot be met by local labour.
But what happens when the economy of the origin country moves towards that of a developed nation, and those workers choose to stay at home instead of moving abroad for work? What happens when those fruit farmers can’t find enough workers, and fruit is left on trees to rot?
Well, that’s where automation factors in. As these businesses start to feel the financial burden of the labour shortage, they will naturally begin to invest more money in developing new systems that can produce more using less labour.
And then we have to think about economic growth.
In the years 1995–2005, the average productivity of American workers grew by 2.9% per year. Yet when we look at the following decade, 2005–2015, the average annual increase in the productivity of American workers fell to only 1.3%.
This is one of the key reasons that middle-class wages have been stagnant. While technologies like smartphones and Facebook have become a huge part of our lives, they not transforming the way we work. And that’s a problem.
They’re not having the same effect on our productivity as say, the internal combustion engine or electricity or the printing press. And while this may sound good if you’re interested in not losing your job to a robot, it’s not good if you’re hoping for an increase in your wages.
