• Cosimo Orban

Automation is cause for unemployment, or is it? (Authentise Weekly News-In-Review – Week 43)

There’s been massive outcry recently regarding the shift in automation employment in various industries, threatening nearly 40% of jobs by 2030. Factories are quickly implementing new automated systems for warehouse management, manufacturing and most menial tasks. Taking away manual jobs from the market, many are complaining it’s eroding the economy as a whole in the process. In fact, some countries are relying on industries that are seeing a massive shift to automation, effectively truncating and undermining their workforce. This is most dangerous to those regions struggling to rise above the poverty line, where traditional factories are being replaced by automated performance power-houses. Nonetheless, the data is showing automation is not characterizing unemployment as we feared. This is all the more pronounced in those countries where institutions have been put in place to enable the pursuit of more future-oriented occupations. If we look back at ATMs in the ’70s, we will see a decline in the number of employees per branch but the new system encouraged companies to build more and more branches, mitigating the effect. All in all, while automation is having an impact on unemployment per se, new possibilities are being created to make a smarter, more efficient system possible while keeping the economy machine churning.

This Economic Model Organized Asia for Decades. Now It’s Broken

Today, Bangladesh, Cambodia, and Myanmar are in the early stages of climbing that ladder—but automation threatens to block their ascent. Instead of opening well-staffed factories in these countries, Chinese companies that need to expand are building robot-heavy facilities at home. “The window is closing on emerging nations,” says Cai Fang, a demographer in Beijing who advises the Chinese government on labor policy. “They will not have the opportunity that China had in the past.”

Keep reading at Bloomberg.

The rise of robots in the German labour market

Although robots do not affect total employment, they do have strongly negative impacts on manufacturing employment in Germany. We calculate that one additional robot replaces two manufacturing jobs on average. This implies that roughly 275,000 full-time manufacturing jobs have been destroyed by robots in the period 1994-2014. But, those sizable losses are fully offset by job gains outside manufacturing. In other words, robots have strongly changed the composition of employment by driving the decline of manufacturing jobs illustrated in Figure 1. Robots were responsible for almost 23% of this decline. But they have not been major killers so far when it comes to the total number of jobs in the German economy.

Read the full article here.

Chill: Robot-related job loss won’t be that bad (probably)

[…] the ATM was highly disruptive. You’d be tempted to equate this disruption with job loss, as fewer employees at bank branches meant thousands were suddenly without jobs.

But you’d be wrong.

Since ATMs made it much cheaper for banks to operate, it led to a boom, of sorts, in building new branches. From 1989 to 2004, banks opened 43% more physical locations than it did in the period before ATMs — leading to more jobs in banking, consequently.And that’s not even considering the additional skilled laborers needed to install, configure, and maintain over 400,000 ATMs installed nationwide since the 70s. Or, there’s the drivers and guards needed to fill them. There’s those who work in customer service, laborers who man the assembly lines, parts companies responsible for the pieces within them, ISPs (and their employees) who keep them online, security experts who lock down the network from hackers, and so on.

Read the full article at The Next Web.

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