Sending in the Robots
Terry H. Schwadron
Nov. 12, 2021
Amid all the competing reports about employers seeking workers, workers seeking better jobs, and an economy that either is doing just fine or going off the rails, add in one more element: Robots.
While we argue about whether growth or inflated prices for gas and food should rule the day, it turns out that recent reports by the International Federation of Robotics show the last year showed a 12% increase in investments in professional services robots over the previous year and a 10% increase in global deployment of industrial robots this year.
Anecdotally, there are more mentions in scattered news and magazine reports about a widening of use of automated robots in hospitals and through the food industry.
While not new, the trend, which has been building slowly over years, as robotics and artificial intelligence have advanced, is now starting to hasten post-covid.
From a productivity point of view, it clearly is an interesting change in business. From a worker’s point of view, it raises questions about the world we’re rebuilding based on machines rather than people. From the taxpayer’s point of view, we might wonder a bit louder why this all is still incented by our tax policies without a whole lot of mention by our political leaders.
Indeed, we hear a lot these days about big spending bills that will boost “invention” — and alternatively, opposition to those bills to leave the speed of that invention in the hands of corporations.
But we’re not connecting those sloganeering dots to the effects on the actual workplace.
Who’s Doing It?
Some percentage of those still-open jobs are never coming back. We know that. Covid has changed consumer habits and left all kinds of supply-chain problems that are re-making manufacturing and distribution.
Just how many jobs are being lost to automation, however, is uncounted. Bloomberg News is reporting that labor shortages and rising wages are pushing U.S. business to invest in automation. A recent Federal Reserve survey of chief financial officers found that at firms with difficulty hiring, one-third are implementing or exploring automation to replace workers. In earnings calls over the past month, executives from a range of businesses confirmed the trend.
A large part of the motivation behind the infrastructure and social services spending bills put forth by Joe Biden are meant to stimulate job growth, even as we now start to see job numbers building as vaccines are making covid dangers recede.
If the ports are backed up now, one answer is more mechanization to create 24-hour days as a cheaper alternative to hiring enough workers to do the job; if truckers are lacking, perhaps we should be hastening deployment of automatic trucks onto our highways. The talk in Washington is about jobs, but the reality is pushing the boundaries of automation.
Some examples:
— Domino’s Pizza. is “putting in place equipment and technology that reduce the amount of labor that is required to produce our dough balls,” Chief Executive Officer Ritch Allison told Bloomberg.
— Hormel Foods Corp., maker of Spam spread, and Skippy peanut butter is ramping up automation because of perceived tight labor supply.
— Tyson Foods Inc., the meat company, is looking to use more robots on its production lines, opening a large automation research center in Arkansas.
— Hospitals and universities have deployed Sally, a salad-making robot created by tech company Chowbotics, to replace dining-hall employees. Hospital beds and cotton swabs are being produced by industrial robots from Yaskawa America.
— Malls and stadiums are using Knightscope security-guard robots to patrol empty real estate
— A company named Savioke is producing a mechanical butler for hotels to deliver towels and toothbrushes.
— Experiments are underway to test a bricklaying robot that can lay more than 3,000 bricks in an eight-hour shift, up to 10 times what a human can do, or plant seeds and harvest crops, separate breastbones and carcasses in slaughterhouses, pack pallets of food in processing facilities.
Increasing Trend
The population of industrial robots in global factories, once concentrated among automakers, now is estimated at about 3 million, with deployment in service industries just getting underway (Cue the sex robot industry).
Perhaps the Bureau of Labor Statistics should be adding some robot counts to the monthly jobs report.
Reuters reports that companies ordered 9,098 robots in the first quarter, a 19.6% increase over a year ago, according to the Association for Advancing Automation, an industry group based in Ann Arbor, Michigan. Biggest growth is among metal producers and food processing plants.
A recent study by economists at MIT and Boston University suggests robots could replace as many as 2 million workers in manufacturing alone by 2025, Time Magazine reports.
What has yet to emerge are job training programs to reeducate workers into managing automation or update the coding for additional tasks.
And our tax codes reward companies universally for investing money in research and development and in equipment — without determination about whether there is an overall effect on employment. It is a mainstay for companies to avoid taxes by reinvestment.
Just as a guide, in 1964, when the most valuable company in America was AT&T, the company had 758,611 employees; the most valuable company today, Apple, has 137,000 employees. Bigger profits are not being shared by fewer employees and by more shareholders instead.
Perhaps we should be incenting companies to build growth around the education of employees for new tasks.
Or perhaps we should install robots to handle the politics in Washington.
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