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Automation, a topic which needs to be discussed more frequently. I’m sure we’ve all had the same debate. Sitting around the television screen on a Saturday evening watching Terminator, with a big plate of nachos, when someone brings up how AI will soon take over the world and enslave humans. However, are we really going to be ruled by the iPhone?! What is this colossal disruption that seems to have every industry panic-stricken?
The discussion around automation takes shape in two main forms: RPA (Robotic Process Automation) and AI (Artificial Intelligence – otherwise known as IA: Intelligent Automation). RPA will automate highly structured tasks that don’t need much human thought process involved. Whereas IA will aid the completion of tasks with more cognitive attributes and human inputs required.
This will lead to a mass shift in job and job roles in most organisations, but the main question on our minds is whether this shift will lead humans to be obsolete? What will humans do and why are organisations across the industry spectrum investing heavily in technology?
Figure 1: Global automation market size in 2016 and 2020, by segment (in billion U.S. dollars) Source:https://www.statista.com/statistics/257170/global-automation-market-revenue-by-end-market/
To answer the $200 billion (see figure1 above) question, let’s look to the past and see if anything like this has happened before – and if so what can we expect? Looking from the 16th century onwards several different “technology revolutions” have taken place. The Scientific Revolution changed our views about society and nature. The British Agricultural Revolution kick-started the first industrial revolution in the 18th and 19th centuries which, along with the second industrial revolution, had a massive effect on technological, social and cultural shifts. Computers started changing the scene after the digital and information revolutions from the 1950’s onwards.
Labour markets have always shifted with new technology advances. In workplaces today, most people work with technology, whether it be a computer, van or drill. The introduction of tech has always seen a degree of resistance to adoption due to the premise that workers will lose jobs, nonetheless arguments of efficiency prevail. Workforce skills change and tech is used to get more done in the working day, often with better quality. Productivity and ‘getting stuff done’ increases. New services arrive, along with altering economies. Child and slave labour were outlawed and the entertainment industry was born due to people having more free time than ever before. Education reforms are made to keep up with the new skills needed for industries, but re-training the current workforce still remains a challenge. This leads to the loss of jobs for the generation that experienced the shift.
Looking at the past, we expect something similar. Children at primary school level today are learning how to code, with a new sense of importance in science and problem-solving skills. Organisations are causing massive disruptions by introducing new tech and struggling to obtain the right talent with the current skills gap. Yet, many seem to be cutting funding in training investment. Taking lessons from before, we can expect the new generations to be attuned to working with and building AIs to ‘get the job done’. Today’s workforce could be left behind in the sweeping changes to come.
Commonly, automation and AI are interpreted as leading to a reduction in costs, due a perceived reduction in people resources required. Though true for some strategies, overall, other factors take place when looking at automating tasks at work. These factors include: “greater speed, higher quality, scaled capabilities and new capabilities” [source: https://betterworkingworld.ey.com/workforce/how-do-you-ensure-you-are-automating-intelligently?utm_campaign=automating%2Bintelligently&utm_medium=bitly&utm_source=alwin%2Bclub]. In many cases organisations are investing in tech to stay competitive, as new competitors are providing the same service faster, with better quality and at a cheaper rate. Products are becoming more people centric with greater connection to revenue and people than ever before. The business case to invest in getting the right talent, in the right place, at the right cost (termed as workforce planning) has never been stronger. On the whole, the nature of jobs will change to help introduce efficiencies to stay competitive, but jobs will still be there and humans will still be needed to work by computers.
Figure2: The distribution of BLS 2010 occupational employment over the probability of computerisation, along with the share in low, medium and high probability categories. Note that the total area under all curves is equal to total US employment.
In figure2 below, we see the probability of computerising jobs in different industries. 47% of the US workforce is at a high risk of being computerised with ‘Service’, ‘Office and Administrative Support’ and ‘Sales and Related’ as the top contenders. ‘Transportation and Material Moving’ will be one that we see in our day-to-day lives, as the nature of jobs (such as train drivers) will change.
When looking into individual jobs, 12 out of 700 were found to be 99% susceptible to automation:
While employment will be created in technology, the clear skills difference between the jobs above and the new roles is notable. The same study also found a strong negative relationship between higher education and probability of computerisation (see figure3 below):
Figure3: Relationships between wage and higher education with probability of computerisation.
Taking U.K. health care as an example, currently the age distribution of nurses is heavily skewed (see figure4 below). Without reform, the next few years we will see experienced nurses retire, suggesting an even bigger strain on the national health system as a skills gap is created. Work will be shifted to doctors and the level of care will drop. The new bio-tech marketplace may soon play a big part solving the inefficiency we are experiencing today and in the future. Nurses and doctors, aided with AI and robotics may lead to innovation of the way in which care is given, resulting in a cost-effective solution.
Figure4: Age profile of nurses working in the UK, 2007 and 2017.
Source: The UK nursing labour market review 2017, Royal College of Nursing
Ultimately, we need to be prepared for the change to come. Job roles, societies and cultures will all shift as our technology advances. Humans will still have a role to play but the main challenge of re-skilling today’s workers for different roles remains, just as it always has.
Posted on September 19, 2018