Will automation replace the human workforce?

In January of 2017, McKinsey stated that around half of the work that is currently done worldwide can be automated. Examples of activities that can be automated are data processing, claim handling, and administrative work. But not all jobs are subject to automation just yet. Automation is most suited for actions where minimal thinking is required, that is a repetitive and rule-based task. Furthermore, only about 5% jobs that are most likely to be fully automated.

Automation is the result of technological advancement, mixed with a constant need for productivity improvements. Think about the production lines in the automotive industry or harvesters in the agricultural industry. While this has previously only influenced one or a couple of industries, it has never disrupted the entire economy. Automation will however affect most of the industries that people work in nowadays. It will allow us to do more, in less time, while also taking away some of the burden of tedious tasks.

On the other hand, it will decrease the amount of middle-level jobs, without creating many new ones in return. This is where the challenge of automation is most prevalent. It can lead to employment polarisation, meaning that it creates a gap between the lower-end jobs, like facility services, and the higher-end jobs, like doctors. This will increase the wealth inequality. However, similar situations have occurred before. For example with the creation of the steam engine, eliminating a lot of the physically intensive jobs. Here the required skills changed, and people have adapted.

Automation at a large scale will not happen overnight though. While certain tasks might be automated very fast, the disruption of the economy will take time. It is estimated that 30% of the work currently done will be automated by 2030. These will probably involve the simple, rule-based tasks, mostly partial jobs. As a result, the same can be achieved with less people, because jobs can be combined. It is therefore very important that there is an adequate job support system for those jobs that are most affected, to avoid rising unemployment. It will however take another 25 years to automate the other 20% of jobs suited for automation, presumably more integral business processes involving thinking processes.

While automation offers great business benefits, mainly in the field of productivity, it poses a great risk for the employees involved. It will be very interesting to see how the employment market will develop itself.

Sources:

1. https://www.mckinsey.com/featured-insights/digital-disruption/harnessing-automation-for-a-future-that-works
2. https://www.ted.com/talks/david_autor_why_are_there_still_so_many_jobs#t-480645
3. https://www.mckinsey.com/featured-insights/future-of-organizations-and-work/Jobs-lost-jobs-gained-what-the-future-of-work-will-mean-for-jobs-skills-and-wages