March 2, 2015
“From steam engines to robotic welders and ATMs,” writes The Wall Street Journal (Feb. 25, 2015), “technology has long displaced humans—always creating new, often higher-skill jobs in its wake.” But recent advances—everything from driverless cars to computers that can read human facial expressions—have pushed experts to look anew at the changes automation will bring to the labor force. They wonder if automation technology is near a tipping point, when machines finally master traits that have kept human workers irreplaceable.
In the Australian Outback, for example, mining giant Rio Tinto uses self-driving trucks and drills that need no human operators at iron ore mines. Automated trains will soon carry the ore to a port 300 miles away. The Port of Los Angeles is installing equipment that could cut in half the number of longshoremen needed in a workplace already highly automated. Computers do legal research, write stock reports and news stories, as well as translate conversations; at car dealers, they generate online advertising; and, at banks, they churn out government-required documents to flag potential money laundering—all jobs done by human workers a short time ago.
Bill Gates said last year that automation threatens all manner of workers, from drivers to waiters to nurses. Gartner, the technology research firm, has predicted 1/3 of all jobs will be lost to automation within a decade. And in 2 decades, forecast Oxford University profs, nearly 1/2 of the current jobs will be performed with machine technology.
The first time automation spawned fears of a jobless future was in the 19th century, when English textile workers attacked the first mechanical knitting machines. They were right to fear the contraptions, which eventually replaced them. Some new machines are so efficient they push down prices and create more demand—which in many cases spawns more jobs, not fewer. The invention of the automobile threw blacksmiths out of work, but created far more jobs building and selling cars. Displaced workers with obsolete skills are always hurt. but the total number of jobs has never declined over time.
This post provided courtesy of Jay and Barry’s OM Blog at www.heizerrenderom.wordpress.com. Professors Jay Heizer and Barry Render are authors of Operations Management , the world’s top selling textbook in its field, published by Pearson.