Robots are taking all our work – or are they?

Technological advancements have reached the point where people are becoming worried that there might be mass redundancies in the near future. Some are even talking about the fourth industrial revolution where robotization and automatization are the main factors. This creating destruction could fundamentally transform the labour market since, in many fields, human labour can be replaced by a faster and more efficient machine or algorithm. However, robots are already among us; numerous industrial fields have been utilizing them. A research group studied how labour field conditions have changed in Germany, where industrial robots are broadly used.

ROBOTS CAUSE NO TURMOIL IN GERMANY

Robots are already present in many industrial fields and have been replacing human labour at an alarming rate. Currently, China is the leading country in automatization, however, Germany has started to catch up in the past decades. In the past 20 years, the number of industrial robots has doubled in Germany (where they are used in the automotive industry, primarily). While in 1994, there were 2 robots for every 1000 people, by 2014, this number has increased to 7.6, which means that Germany excels in the application of industrial robots (this ratio/rate is 1.6 and 2.7 in the USA and Europe at average, respectively).

A research group was studying how these processes affected labour market conditions. They found that despite the expansion of automatization, there have not been significant redundancies, meaning that employment rate has not substantially declined in the past 25 years (in the 1990s, it had been 29% which decreased to 25%). According to the authors’ estimations, only 23% of the total decline in industrial employment can be explained by robotization gaining ground, even though one industrial machine can replace the work of two people. However, in the USA, the use of robots is actually responsible for the destruction of the majority of industrial jobs.

Of course, the fact that there were no mass redundancies does not mean that Germans have reinvented the wheel. It simply means that companies needed less new employees. According to the authors, between 1994 and 2007, robotization ‘took’ 275 thousand potential jobs in the industry. Eventually, these people found positions outside of the industrial sector.

The study also found that those who already had had stable jobs had a high chance to also keep it – of course, they are still exposed to the effects of robotization; for example, they might have to fill different positions. The low-skilled labour was the most severely affected (those with manual labour) because they had to face pay cuts, even though they could have kept their jobs.

One of the main reasons why positions could remain unaffected is that labour unions effectively made a stand for the rights of workers. German labour unions are famous of/for their ability to significantly affect labour market conditions in order to keep wages and employment rates high.

So far, it seems that German workers are not in danger because even though automatization has increased productivity and profit, there were no mass redundancies.

Of course, robotization and automatization might have an increasingly major role and extend to a broader aspect of industries. It is not a coincidence that articles, discussing the most endangered jobs, are turning up in the media. Certainly, less complex tasks or those that follow well-defined algorithms could easily be done by machines. The study also says that automatization gaining ground could also lead to further inequalities because its main beneficiaries are those with high qualifications since any increase in productivity would also raise their wages. However, we must not forget that besides its negative effects, technology could also create new professions and jobs, as we have seen it throughout history.

Original date of Hungarian publication: October 19, 2017