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May 12th, 2017

Automation: Job Creator or Destroyer?

 

AI, robotics, automation, and the Internet of Things, are technologies that are primed to make a huge impact in business and our daily lives. This year’s World Economic Forum had a session where their panel of leading experts discussed whether this impact would be positive or negative - with mixed results.

This tipping point has brought up a lot of questions surrounding the development and implementation of AI in the workplace that are not only economic but existential as well.

Will this fourth industrial revolution create more jobs than it destroys, or vice versa? Is the future a life of leisure? Is a life of leisure fulfilling? Will everyone have access to these potential luxuries, or will the gap between the ‘haves’ and ‘have nots’ widen even further?

Or conversely, will machines become so advanced that humans are made obsolete with science fiction writers, à la The Matrix or Terminator, leading with a resounding “I told you so”?

 

In the early days of robotics and automation, it was routine physical work that was being accomplished more cheaply and efficiently. Now the technology is becoming increasingly capable of carrying out cognitive activities such as making judgment calls, solving problems, sensing emotions, and driving. IBM’s Watson for example, is involved with assisting in cancer research and tax returns, while Google’s AlphaGo did what was thought to be impossible by winning a game of Go against Lee Sedol who is one of the best players in the world.

This means that it is no longer only labourer’s who need to worry about how these innovations will affect their jobs, but those in white collar positions as well.

 

The sky is falling!

The main fear is that even though artificial intelligence will increase efficiency across industries, this will ultimately translate into unemployment, as jobs are replaced by machines.

Stephen Hawking has given a number of warnings along this line, adding that automation will also increase inequality as well as the potential for significant political upheaval. Writing for The Guardian in 2016, "The internet and the platforms that it makes possible, allow very small groups of individuals to make enormous profits while employing very few people.”

Hawking also lends some credit to the seemingly outlandish sci fi outcomes from above, expressing concern that AI has the potential to overtake humans through accelerated evolution. Saying in 2014, "It would take off on its own, and redesign itself at an ever-increasing rate. Humans, who are limited by slow biological evolution, couldn't compete, and would be superseded."

 

A collaborative utopia

On the bright side, as of now, even though most of today’s jobs have aspects that can be automated, it is very rare to find one that can be completely automated.

Every job has different types of activities that require different cognitive and physical capabilities, therefore each activity has a different capacity to be automated. So instead of analyzing the impact of entire occupations being automated, the impact of the automation of individual activities should be the focus.

Full versus partial automation is an important factor to consider since it leads to vastly different economic outcomes. A job that becomes completely automated removes that position from the job pool, reducing employment. But employment can actually increase when certain activities within an occupation are automated. A classic example of this being cloth production during the Industrial Revolution. Advancements in weaving technology made the process of making cloth more efficient, which dropped the price. More people were able to afford the cheaper cloth, and factories were subsequently able to hire additional workers to keep up with demand. So even though the process of making the cloth became mechanized, human employees were still needed to operate the machinery.

This applies to today’s fears of potential mass unemployment. With only aspects of occupations becoming automated, people will be needed to continue working alongside machines to maintain and operate them, as well as in a collaborative manner. When humans and machines work together, businesses are able to improve their overall performance. A reduction in errors like human bias and a computers lack of creativity, as well as increase in efficiency, achieve outcomes beyond purely human, or mechanical capabilities.

 

So, which is it?

With each new technological leap, we ask whether machines are taking our jobs or making our lives better. It is still early in terms of widespread adoption of automating technologies, and there are studies with conflicting evidence on the impact that innovation has, especially in the long-term. New technology has created more jobs than it has destroyed in the past, but not every cycle can be the same, and there is evidence that robotics is already having a disruptive effect on employment and wages, and will continue to as it advances.

So, like any discussion about what the future will bring, today we can only speculate what the long-term result will be, but being aware of the potential outcomes can certainly help in steering towards the future that we want. 

 

 

 

 

 

 

 

 

 

Sources used for this post:

Bessen, J. E. (2016). How computer automation affects occupations: Technology, jobs, and skills.

Condliffe, J. (2017). This group thinks robots aren’t stealing jobs from humans—and never willMIT Technology Review. Retrieved 11 May 2017, from https://www.technologyreview.com/s/607850/is-automation-warping-the-labor-market-as-dramatically-as-we-think/

Hawking, S. (2016). This is the most dangerous time for our planet | Stephen Hawkingthe Guardian. Retrieved 19 April 2017, from https://www.theguardian.com/commentisfree/2016/dec/01/stephen-hawking-dangerous-time-planet-inequality

Kessler, S. (2017). One. That's how many careers automation has eliminated in the last 60 yearsWorld Economic Forum. Retrieved 12 April 2017, from https://www.weforum.org/agenda/2017/03/automation-has-totally-eliminated-just-one-career-in-the-last-60-years?utm_content=buffer33243&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer

Manyika, J., Chui, M., Miremadi, M., Bughin, J., George, k., Willmott, P., & Dewhurst, M. (2017). Harnessing automation for a future that worksMcKinsey & Company. Retrieved 16 April 2017, from http://www.mckinsey.com/global-themes/digital-disruption/harnessing-automation-for-a-future-that-works

McCaffrey, T. (2017). There Will Always Be Limits to How Creative a Computer Can BeHarvard Business Review. Retrieved 25 April 2017, from https://hbr.org/2017/04/there-will-always-be-limits-to-how-creative-a-computer-can-be?utm_campaign=hbr&utm_source=twitter&utm_medium=social

Price, R. (2016). Stephen Hawking: This will be the impact of automation and AI on jobsWorld Economic Forum. Retrieved 18 April 2017, from https://www.weforum.org/agenda/2016/12/stephen-hawking-this-will-be-the-impact-of-automation-and-ai-on-jobs?utm_content=buffere58c9&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer

Williams-Grut, O. (2016). Robots will steal your job: How AI could increase unemployment and inequalityBusiness Insider. Retrieved 20 April 2017, from http://uk.businessinsider.com/robots-will-steal-your-job-citi-ai-increase-unemployment-inequality-2016-2

Williams-Grut, O. (2017). 3 of the world's 10 largest employers are now replacing their workers with robotsBusiness Insider. Retrieved 14 April 2017, from http://uk.businessinsider.com/clsa-wef-and-citi-on-the-future-of-robots-and-ai-in-the-workforce-2016-6