They can work day and night. They don’t need down time, breaks or medical insurance. They don’t have conflicts with with their bosses or colleagues, and take no personal time to deal with their problems. They are robots!
Employers would be happy to have a staff consisting of robots, while employees have many fears regarding robotics-based workforce and its impact on employment.
Undoubtedly, the future workforce looks different from that of today. The IFR (International Federation of Robotics) estimates that more than 2.5 million industrial robots will work at enterprises in 2019 — an increase of 12% since 2016.
How Automation Will Affect the Workforce
Automation in the form of robots and artificial intelligence algorithms brings significant changes to the structure of the labor market and the whole economy. Robotic automation performs highly repetitive, difficult or dangerous manual tasks in manufacturing and other industries. AI systems supplement employees — such as accountants, financial experts or doctors — performing cognitive tasks.
As with any revolutionary technology, there are two sides to the coin when it comes to the robotics-integrated workforce.
People are concerned about the widespread application of autonomous technologies across industries and organizations. The main problem they worry about is the elimination of many job positions and, consequently, unemployment.
The McKinsey Global Institute carried out the research in 46 countries concerning the influence of robotic automation on the human employment. They found that up to 800 million workers worldwide could be replaced by machines by 2030. This means that one-fifth of the global workforce could be affected.
The greatest impact will be seen in developed countries, as they have the finances and the necessary infrastructure for digital transformation. In the US alone, 39 to 73 million jobs may be eliminated. In the UK, 20% of current jobs will be automated, and Germany may need to retrain one-third of the workforce for other jobs during the same period.
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Poorer countries with less money to invest in robotization will not be affected as much. In India, for instance, only about 9% of positions will be automated.
According to the report, the most vulnerable jobs are those that require less education and are easy to automate, e.g. machine operators, assembly line workers, office workers, accountants, etc.
Jobs involving social interactions and managing people, however, will be less affected because machines are unable to outperform humans in such tasks. They include specialized jobs in unpredictable conditions, e.g. teachers, pediatric and geriatric nurses, or plumbers and electricians. These positions will not be eliminated as they are difficult to automate. Moreover, these are lower-wage jobs, and the cost of workforce automation will be much higher.
The consequences will concern not only the labor market but also the geopolitical situation, trade policy and immigration issues. Bottom line, automation will definitely have some negative outcomes.
The main goal of emerging technologies is not to replace humans in their jobs but to make all processes safer and more efficient. The final result should not be a confrontation, but rather a beneficial collaboration between automated robotics and humans.
According to the McKinsey report, employment in the automated industries may not decline but rather increase, as new types of jobs will appear and new skills will be required. Millions of displaced workers will occupy these workplaces and perform new tasks. Moreover, human employees will take higher-level positions requiring creativity and decision-making.
History has already seen such a workforce shift in the 1980s with the introduction of the personal computer. It was thought to endanger the employment situation, but in reality, it has led to the creation of IT-industry and online business.
Positive contributions of automation, AI and robots are:
- Increased quality and productivity
- Increased competitiveness
- Increased product demand
- Increased demand for high-skilled workers
- New job opportunities
- Augmentation of human labor
- Positive impact on wages
Will There be Enough Work in the Future?
Labor markets throughout history adjust to different kinds of shifts. Technological disruption is not as frightening as it may seem. It does create new jobs!
Possible driving forces behind employment growth are:
- Rising consumption (global consumption is estimated to grow by $23 trillion by 2030, mostly due to developing countries; the increasing number of consumer goods can create up to 280 million new jobs)
- Aging population (the number of people aged 65 and older will be 300 million more than it was in 2014; this will lead to an increased demand for healthcare and other personal services workers; 50 million positions can emerge)
- Technological development (up to 50 million high-wage positions related to serving and support of the emerging technologies may appear)
- Building industry (there have always been shortages of infrastructure and housing; to overcome these gaps, new technologies will be introduced into the building industry, requiring up to 80 million new skilled engineers, architects, electricians and construction workers)
- Renewable energy (investments in energy-efficient technologies are growing and can create up to 10 million new jobs; workers in manufacturing, construction and installation of renewable energy devices and systems will be needed)
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In the future, we expect to see the growth of the global economy and, consequently, enough new types of occupations that will balance out the influence of automation. Nevertheless, job creation will vary significantly by country depending on wage rates, demographics, economic growth and industry structure.
How to Manage the Upcoming Workforce Transformations
When robots in the workforce become the norm, this will bring many challenges for chief managers and directors. They will need to reemploy displaced workers quickly in order to prevent increasing unemployment. For that to happen, they will have to ensure that workers have enough skills needed to transfer to new jobs and collaborate with smart machines, AI software and systems.
Management initiatives will need to embrace four key areas:
- Maintain economic growth to support job creation (essentials are sustained investments, support for innovations and new business formation, fiscal and monetary policies to ensure sufficient demand)
- Provide retraining and skill development (new educational programs, on-the-job training, opportunities to learn and upgrade skills throughout a lifetime)
- Improve labor-market flexibility (labor mobility, dynamic job-seeking platforms to easily match a company with workers)
- Provide income support to displaced workers (unemployment insurance and other financial benefits, public programs offering support in finding work, assistance in shifting to other work)
Government officials, business leaders and ordinary workers will need to have a creative vision of how to organize work in the future and value its role in the society. Companies will have to prepare and train workers for new working environments to ensure a smooth transition to the human and robotic workforce. Those countries that fail to manage the transition might see an increase in unemployment and declining wages.
To Sum Up
Robots and automation are often seen as “job killers.” In reality, they promote different workforce shifts around the globe that have both positive and negative consequences. The main task of governments and top management of companies is to create a working environment that will enable everyone to benefit from these shifts. This implies supporting investments, research activities and development of technologies together with providing education and skills training for human workers.