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Key Take Away: Robot implementation continues at record pace, but robots still create more jobs than they take.
China and the United States share some critical labor force demographics. Both countries have a large portion of their workforce that is aging and retiring.
Because China is not willing to relinquish their hold on manufacturing dominance, adding robots to mitigate the labor shortage has been the cornerstone of their strategy to compensate for the labor shortage.
The United States has rapidly added robots as well. But China’s robot implementation equals the rest of the world combined. The rest of the world includes the numbers from the United States.
Because we are in the manufacturing space, we tend to think of physical robots doing tasks. In our world, it is about loading and unloading the CNC machine. But the points in this blog post include robots performing other functions as well. That includes robots outside of the industrial space.
Fears of machines taking jobs go back as far as the 1800s. Think back to your history classes and the British “Luddites” who protested technology in the textile world. Machines were lowering the cost of production and there was a fear of the machines taking all the jobs.
In the late 1950s, America was experiencing the worst recession since the Great Depression. At the time, unemployment reached nearly 8%. While that may be small then you think about the short-term unemployment with the pandemic, that was the largest unemployment rate we had experienced since the Great Depression. Think about the market conditions. Much of the industrialized world had been decimated by the bombings in WWII. Those economies were rebuilding and advancing technology.
America escaped the demolition of WWII. But we did not escape the impact. Newly rebuilt factories around the world were churning out goods at lower costs. Around the world, blast furnaces that made steel were newly rebuilt and more efficient. They made high quality steel faster and cheaper. The world was beginning to globalize and low-cost production made other goods more attractive. Sound familiar?
The late 1950s recession was ended when Eisenhower pushed out the plan to build the Interstate Highway System. That created a lot of jobs. Other infrastructure projects created more jobs.
To compete with products from low-cost sources, America began automating. Even the unions agreed to adding technology to improve production rates and cut costs.
University of Chicago economist Yale Brozen, did a study on the impact of automation on the 1950s. His study showed that automation destroyed more than 13,000,000 jobs. At the same time, there were 20,000,000 new jobs that were created by automation. Those jobs didn’t previously exist.
The question of automation stealing jobs has been around for some time. And it seems to keep coming up.
Our current foray into automation came at the confluence of a labor shortage and the pandemic. An aging population and a shrinking workforce created a labor shortage. At the same time, the globalization trend from back in the 1950s has started to abate because of supply chain issues.
Countries that were once low-cost providers were no longer low cost. Add to that the cost of transportation and the impact on the planet and leaders began to reconsider globalization. Political leaders started to realize national security is dependent on an uninterrupted supply of strategic goods.
Supply chain issues started by the pandemic made these points increasingly clear.
Combining the labor shortage with supply chain issues and reshoring, America is faced with a significant labor issue. A familiar solution is gaining prominence: robotics.
To the question, “Are robots stealing jobs?” the facts suggest that people tend to overestimate the extent to which robots are replacing people in the workforce. A recent study from Brigham Young University sociology department says roughly 14% of workers have been displaced by robots.
Those workers who have had a robot take their job tend to think that robots have taken 42% of jobs. Those who haven’t had their job taken by robots but know someone who has, tend to think that robots have taken 29% of jobs. That is twice the actual rate of 14%.
Like the University of Chicago study, look at the jobs automation as taken, and jobs automation has created. It is important to look carefully at the pay rate for the jobs taken and the pay rate for the jobs robots have created.
There are studies that suggest that robots aren’t displacing workers. Rather, workplaces are integrating both employees and robots in ways that generate more value for human labor. The studies show that where robots and humans collaborate, productivity increases are greater than humans or robots working alone.
Most of the jobs that robots are doing are the jobs that people don’t want. That is the low hanging fruit. If you can’t find a person to do the work and the work truly needs to be done, a robot is a powerful solution.
At home, you may have a robot that cleans the carpet for you. Grocery stores have an autonomous vehicle floor scrubber that cleans the floors. Whether at home, or at the grocery, humans are responsible for getting the places where the machine can’t clean.
Another example of robots and humans working together can be found in aerospace. Humans used to paint airplane wings and it took hours to complete the job. Today, a robot can one coat of paint in 24 minutes. Humans load and unload the paint while the robot does the painting.
That is just the opposite of our machine tending robots. The robots tend the CNC, humans are free to do other, more valuable work.
Ready to explore more with CNC automation? Call us at 866-952-9020 and press 1 to start the conversation.