How COVID-19 Accelerated Automation
The pandemic lead to a dramatic shift in advancements, faster than expected.
The COVID-19 pandemic has forced a small but significant shift in the advancement of robotics. Since human contact spreads COVID, some machines are now considered as protection against the virus. This has accelerated the use of robots in a way that no one expects to slow down after the pandemic.
Richard Freeman, a professor of economics at Harvard University, who is studying labor said "If you keep me six feet away from the other worker and you have a robot in between, it's now safe, and the robot companies are selling that as a solution and the unions aren't going to say, 'No, you should have the workers standing next to each other so they get sick.' "
This creates an increased use in machines, like windshield-mounted toll detectors, automated floor cleaners at factories, salad-chopping machines in grocery stores, mechanical butlers at hotels, and electronic receipts for road pavers. It is less clear where the men and women who used to do some of these jobs will continue on to work at.
The impact of technology on employment has been a subject of concern for generations and studies have produced mixed results. Cars did not end the train industry, television did not stop the radio. When banks set up ATMs, they hired more staff, not fewer, as the diversity of their services increased. But machines have also destroyed many jobs, and this current wave will be no exception, particularly when it comes to public health.
As office workers communicate at home using remote tools, a domino effect is also felt: bus drivers, sandwich stall owners, and janitors are in trouble as their workplaces that used to support these workers now have no one arriving. Administration jobs, which include those in office buildings, have fallen by approximately 700,000 since 2019. This is according to November information from the Bureau of Labor Statistics. Also, during the pandemic, the stock market drove investors out of labor-intensive industries.
The new automation also seems to be affecting the retail industry. There are 500,000 fewer retail jobs compared to last November. Transportation and warehousing are about 100,000 jobs down. Meanwhile, retail sales are at their highest levels on record, driven largely by e-commerce, which often uses more automation than brick-and-mortar stores.
The World Economic Forum reported in October that 43% of companies surveyed plan to reduce their workforce because of technological integration, while 34% plan to expand their workforce because of this automation. It's expected by 2025, the time that humans and machines each spend on current tasks will be about the same.
Some argue that handing repetitive jobs to robots gives workers the opportunity to take on new roles in a booming industry, such as caring for the elderly. There is a high demand to increase the work force of looking after the "oldest old,".
There are other companies preparing for more events like pandemics, which will lead to more automation and fewer workers. Lucid Motors, an electric vehicle start-up backed by the Saudi Arabian Public Investment Fund, has built a 999,000-square-foot electric vehicle factory in Casa Grande, Arizona, where it hopes to begin production of a $160,000 electric vehicle during the next year.
"After this pandemic, the next pandemic will show up," said Peter Hochholdinger, Lucid's vice president of manufacturing. "We have to put more effort in automation in general assembly."
Also, recessions like the one we're experiencing now, are not an unusual time to invest in automation, because credit is cheaper and companies that shed jobs - albeit because of automation - can attribute the losses to the economy and avoid negative press.
At this time, Chile, the USA, and Mexico spend the least on active labor market policies, which aim to improve the employ-ability of all countries belonging to the Organisation for Economic Cooperation and Development and to increase employment. That is unlikely to change any time soon, because world health concerns are the top priority.