Automation and Austerity

People worry a lot about losing jobs to industrial automation, and they are not being completely unrealistic. However, a new report from the United Nations points out the gaps between fears and reality.

First, about half of all robots  in service are in Germany, the U.S., and Japan. China and the Republic of Korea have increased industrial automation, but most countries that currently have a large industrial workforce are not investing in automation. Countries that are investing most heavily in automation — Germany, the U.S., and Japan — have already gone through the changes workers fear.

The U.N. says that most reports on jobs and automation make an important mistake: they forget that “what is technically feasible is not always also economically profitable.”

In fact, SMBs in the United States tend to put off automation for many years because they are nervous about making the capital investments required. Automating a process might be a money-saver, but an austerity mindset makes that long-term strategy unappealing.

A recent report from the UK, where automation became a priority for government jobs as part of an austerity plan, shows some of the obstacles. Research from Oxford University and Deloitte concluded that 850,000 public sector jobs could be automated by 2030. Software was brought in to take over a number of human jobs that had been done by hand.

Obstacle #1: lack of tech skills. Time previously spent doing jobs was quickly filled by tech courses intended to help workers use the new software, with 3,000 workers taking these courses. Each of those trainees would have to be able to collaborate with the new software well enough to replace thousands of workers in order for this approach to work. That’s actually not happening. The Skills Gap exists in the UK as well as in the US, and the tech training has apparently not been effective. Rumor has it that the government in not going to continue funding.

In the settings where automation has been helpful, it has freed humans from bureaucratic tasks and allowed them more time to work with the public, something that doesn’t automate very well. Savings? Too early to tell, perhaps, but there’s no loss of human jobs so far.

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