The era of the robots

In this highly competitive world, company must reduce costs, improve quality, and expand business globally. Twenty years ago, to reduce cost means to outsource works to low cost countries. Today to reduce cost means to automate using the latest technology. The number one cost is manufacturing is labor cost and by replacing labor with robots, the company can reduce cost significantly.

For example, Amazon a company that sell things online reduces its cost by automate its warehouses with robots that can move boxes of books, CD, DVD and other things from warehouse to shipping trucks. The system cost over $700 million dollars but it is more productive than people who have to "pick, pack, and ship" things. Robots work nonstop, never complain, and do not go on strike asking for more money. Today most manufacturing companies in developed countries are beginning to automate and use robots to replace labor workers. It means there will be much less demand for labor workers although high skilled workers are still being hired to control these robots.

With powerful computer and sophisticated software applications many jobs can be done by software such as secretary, administration, travel agents, finance, accounting, and legal professions. Software can do these things more accurately than people. Any work that is repetitive or fairly well structured is open to automation. Now economists have evidence to explain why U.S. economic output has grown although the number of jobs has fallen. An economist explained: “Companies are doing well, making more money than before, their outputs are great and productivity is excellent but they do not hire more workers because of automation and robots. They can build things faster, better and cheaper which give them higher profit margin but they are not hiring people and that is why unemployment is still high. This change also impacts many developing countries that depend on outsourcing. That is why China's economy will be impacted greatly because their economic prosperity is depending on manufacturing outsourcing.”

The U.S. economy has evolved from agriculture to manufacturing and now to service industries. Each time jobs were destroyed in one sector but were replaced elsewhere. One hundred years ago, farmers lost jobs but manufacturing gained jobs and more people moved to the cities for better opportunities. Thirty years ago many manufacturing jobs moved to low cost countries, factory workers lost jobs but service industry gained jobs. Now it is changing. Manufacturing is back and most factories are operating to full capacity but they are not hiring workers because most jobs are done by robots. That is why unemployment is still high with no sign of getting better. Data from the Bureau of Labor Statistics provide clues to what the next economy will look like. Among the 10 fastest-growing job categories between 2010 and 2020, seven have the word "computer" or "software" in them. If you do not study technology, you may not have good future, at least in the U.S.

Today robots are reinvigorating manufacturing. Companies that make robots are highly profitable and graduates in robotics are in very high demand. The price of robots is also going down as more and more companies are making robots and there is good news as more people have access to affordable, powerful robots that can help them and their businesses become more productive. It is estimated that within twenty years, most factories will be fully automated.

The question is: “Are people losing jobs to robots?” There are people, mostly politicians who complain that since the automation trend began, the number of employment has declined significantly and technology is to blame. The main worry now is with the advancement of sophisticated robots. It is not the lower skills workers who lost jobs but some of the better educated people may lose jobs too. Many jobs in office such as secretary, accountant, finance, banking, and receptionist can easily be replaced soon. There are accountant robots that can calculate tax accounts and do bookkeeping faster than people. There are robot receptionists who would greet customers politely and answer questions in a nice voice. Some airline people whose job checking passenger's tickets are being replaced by self-service kiosks. Many banks tellers have been replaced by Automatic Teller Machine (ATM). An office worker can be replaced by office robots and cannot find work anymore. An assembly line worker could also be replaced by a robot on the assembly line. Most robots can do things more quickly and accurately than people. With technology keeps advancing faster, more workers are getting left behind.

In this Information age, the people who benefit most are the scientists, the engineers, the software developers since they are the ones who create, develop and program these robots. There are high demands for them in every country. Of course, as technology is accelerating, there will be consequences but it does not mean technology will be stopped. In the late 18th century when team engine was invented in England, politicians complained and workers destroyed the steam manufactures. Many scientists and engineers moved to the U.S and started to build steam engines in the new land and started the industrial age here. What will happen to technology in this globalized world? Of course, Politicians see thing differently as many begin to complain that the world is heading into a global technology economy that make a lot of people lose jobs. They promise that they would stop this technology if they have voter supports. Most people probably know that nothing will happen. Economists also see thing differently as they warn about the gap between the rich and the poor will continues to grow, and as the standard of living goes down that could lead to more chaos and unstable society. Educators also see thing differently as they understand that changes are part of progress so they advocate that students should understand this trend and parents must make sure that their children's education is moving toward the technology trends rather than opposite direction. Today “Hot careers” are in information technology, computer, engineering, math and science; these are the job that control the technology and not be replaced by technology. Of course, you can see the world with an optimistic view or pessimistic view.


  • Blogs of Prof. John Vu, Carnegie Mellon University