Price of the ro­bots

Au­toma­tion could spark a deeper mi­gra­tion cri­sis

The Daily Telegraph - Business - - Front Page - Jeremy Warner

De­spite the pall of un­cer­tainty Brexit is sup­posed to have cast over busi­ness con­fi­dence, and a self ev­i­dently slow­ing UK econ­omy, Bri­tain’s re­mark­able job cre­at­ing ma­chine con­tin­ues to fire on all cylin­ders.

Ac­cord­ing to the lat­est Man­power sur­vey of hir­ing in­ten­tions, em­ploy­ers re­main gen­er­ally op­ti­mistic, with more than three times as many firms say­ing they plan to take on ad­di­tional staff in the fi­nal quar­ter of this year as those say­ing they will cut jobs.

Par­tic­i­pa­tion in the work­force has never been higher, and va­can­cies as a per­cent­age of the unem­ployed are at an all-time record. Nor is this just a Bri­tish phe­nom­e­non. World­wide, there are more peo­ple in work to­day, even as a pro­por­tion of our ever grow­ing pop­u­la­tion, than at any stage in his­tory. Iron­i­cally, those of­ten ac­cused of de­stroy­ing em­ploy­ment are also some of the big­gest providers of the new jobs. New au­to­mated Amazon ful­fil­ment cen­tres at War­ring­ton, Tilbury and Bris­tol are ex­pected to cre­ate more than 3,500 jobs, even if it is fair to say that the dis­place­ment ef­fects else­where in high street re­tail­ing are likely to be much big­ger.

All the same, there is lit­tle ev­i­dence to sug­gest that tech­nol­ogy in it­self re­duces de­mand for work­ers in the long term. Yes, in­no­va­tion is prov­ing very suc­cess­ful at dis­plac­ing jobs, but thus far at least, even bet­ter at cre­at­ing them.

Why then do we worry so much about the im­pact of au­toma­tion and ar­ti­fi­cial in­tel­li­gence (AI) on the world of em­ploy­ment? The op­ti­mists, among which with qual­i­fi­ca­tions I count my­self, ar­gue that as with pre­vi­ous in­dus­trial rev­o­lu­tions, the prob­lem will even­tu­ally sort it­self out. More highly paid forms of al­ter­na­tive em­ploy­ment which to­day seem barely imag­in­able will in time come along to re­place the jobs be­ing ren­dered ob­so­lete by to­day’s tech­no­log­i­cal ad­vances. This is what has in­vari­ably hap­pened in the past.

But whereas it’s rea­son­able to think the long-term im­pact will be over­whelm­ingly pos­i­tive, there is good cause for con­cern over the short to medium-term com­po­si­tional con­se­quences. What is more, to­day’s com­puter rev­o­lu­tion dis­plays very dif­fer­ent char­ac­ter­is­tics from past pe­ri­ods of rapid tech­no­log­i­cal and in­dus­trial change. As Adair Turner, for­mer chair­man of Bri­tain’s Fi­nan­cial Ser­vices Author­ity, pointed out at a re­cent con­fer­ence, once a piece of soft­ware has been cre­ated, it can be re­peat­edly du­pli­cated at vir­tu­ally no cost. Nearly all the in­no­va­tions of the elec­tro-me­chan­i­cal age re­quired sig­nif­i­cant phys­i­cal in­vest­ment, which in it­self gen­er­ated lots of new jobs. That may not be the case with much of to­day’s in­no­va­tion.

More wor­ry­ing still, the scope of what com­put­ers can do is ex­pand­ing at light­ning speed. Un­like pre­vi­ous gen­er­a­tions of ma­chine, mod­ern com­put­ers can learn, giv­ing rise to an en­tirely dif­fer­ent pat­tern than hitherto seen of hu­man sub­sti­tu­tion.

Ev­ery­thing from trans­la­tion to medical di­ag­no­sis and now driv­ing a truck or car is un­der threat. There are ad­mit­tedly cer­tain things the machines can­not do, and are most un­likely to be able to in any fore­see­able fu­ture. This may seem to pro­vide a nat­u­ral con­straint on their pen­e­tra­tion of the jobs mar­ket. Carl Frey and Michael Os­borne of the Ox­ford Martin School have iden­ti­fied three key bot­tle­necks. Any form of em­ploy­ment that re­quires cre­ativ­ity, so­cial in­tel­li­gence, or the pow­ers of per­cep­tion needed for com­plex ma­nip­u­la­tion can for the mo­ment ex­pect to re­main im­mune to the ro­bots. Un­for­tu­nately, this doesn’t give much com­fort, for these skills show sur­pris­ingly lit­tle in­ten­sity in the jobs mar­ket as it stands. In any case, Frey and Os­borne con­clude that ap­prox­i­mately 47pc of US jobs are vul­ner­a­ble to au­toma­tion.

To see what the eco­nomic, so­cial and po­lit­i­cal con­se­quences of to­day’s au­toma­tion might be, it is use­ful to re­visit Bri­tain’s in­dus­trial rev­o­lu­tion in the 19th cen­tury. For 40 years or more, it had vir­tu­ally no pos­i­tive im­pact on the con­di­tion of the or­di­nary work­ing man or woman; if any­thing they be­came worse off. Older male work­ers with rel­a­tively well paid ar­ti­san skills lost out badly. The first fac­to­ries were made sim­ple enough to be tended by al­most any­one, so that by 1830 around half those em­ployed in tex­tiles were chil­dren. Many of the dis­placed males ended up in lowly paid agri­cul­tural em­ploy­ment or other forms of sub­sis­tence work.

The par­al­lels with to­day’s world are ob­vi­ous. For the dis­placed weavers of Northamp­ton­shire read Theresa May’s “left be­hinds” and “just about man­ag­ing”. Even­tu­ally, ev­ery­one felt the ben­e­fits of the in­dus­trial rev­o­lu­tion, but it took decades and there was a fierce po­lit­i­cal back­lash in the mean­time. Not for noth­ing, ob­serves Frey, did po­lit­i­cal lead­ers prior to the “great es­cape” of the in­dus­trial rev­o­lu­tion tend to ban labour sav­ing tech­nol­ogy.

The Bri­tish gov­ern­ment was one of the first to em­brace the in­no­va­tions of the time, tak­ing some­times bru­tal ac­tion against any at­tempt to halt the spread of the machines. This may par­tially ex­plain why Bri­tain’s in­dus­trial rev­o­lu­tion was the first. It also helped that the great bulk of the pop­u­la­tion was dis­en­fran­chised, and there­fore in lit­tle po­si­tion to protest.

Yet it is not just the ef­fect of au­toma­tion on our own shores we need to worry about. Equally con­cern­ing, it may close the door on eco­nomic ad­vance­ment in Africa, a con­ti­nent with an ex­cep­tion­ally young, and sub­stan­tially un­e­d­u­cated, de­mo­graphic whose pop­u­la­tion is set to dou­ble over the next 30 years. Pro­duc­tion in com­mod­ity man­u­fac­tur­ing has to date tended to chase the cheap­est labour mar­kets, but when labour be­comes cost­less, goods can be man­u­fac­tured al­most any­where.

One of the great prizes of au­toma­tion is that it should help make pro­duc­tion more lo­cal once more. At the same time, how­ever, it may de­prive large parts of Africa of the op­por­tu­nity, al­ready grasped by much of Asia, to clam­ber aboard the global sup­ply chain. The con­se­quences are po­ten­tially chill­ing. “We do not know what the path to pros­per­ity for Africa might be,” says the afore­men­tioned Turner, “but we had bet­ter work it out, be­cause if we don’t it will make to­day’s mi­gra­tion cri­sis look triv­ial by com­par­i­son”. As I say, the machines will one day make us all much richer; but the col­lat­eral dam­age along the way threat­ens to be con­sid­er­able.

‘Machines will make us all richer but the dam­age along the way could be con­sid­er­able’

Ro­bots at work in one of Amazon’s au­to­mated ful­fill­ment cen­tres. The com­pany says three new cen­tres in Bri­tain will cre­ate 3,500 jobs

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