Human beings have worked diligently to create technologies that make our lives easier for millions of years. And every time we take a leap forward, we leave a class of workers behind. The invention of the wheel displaced people who carried bushel barrels and the Industrial Revolution put many cobblers and weavers out of work. Artificial intelligence (AI) and robotics are no different. But the next rise of the machines will affect more than just manual labor workers. AI is poised to displace skilled and unskilled labor alike. As Kyle Reese said in The Terminator: “…it can’t be bargained with, it can’t be reasoned with, it doesn’t feel pity or remorse or fear, and it absolutely will not stop…EVER, until you are (unemployed).”
Big Trouble In Little China
Just as China was quick to take advantage of trade deals that put American workers at a disadvantage, they are also not shy about displacing their own workers. A leader in the mobile phone manufacturing industry, the Changying Precision Technology Company has forged ahead and integrated robotics into one of its major plants. The factory once employed 650 people. But infusing robotic arms at most levels has allowed the corporation to reduce its workforce to a mere 60 people and defects have dropped 20 percent. The plant manager believes the factory may even replace another 40 people in time, without reducing productivity.
Enter The AI Ninja
In Japan, more than 30 people are expected to be laid off at Fukoku Mutual Life Insurance and replaced with AI. These are not people working in the mailroom or handling physical labor. The insurance company is using AI to help calculate claim payouts to policyholders and expects a complete return on investment within two years. It also believes efficiency will improve. These are fully white collar jobs that require thoughtful claims assessments. A 2015 report conducted by the Nomura Research Institute indicated that nearly half of all Japanese jobs could be replaced by AI in less than 20 years.
There’s little doubt that huge numbers of skilled and unskilled workers can expect job loss and changes in the coming years. The U.S. lost about 2.4 million jobs to China, but robotics may actually be to America’s advantage in terms of bringing back factories. The major reason companies moved their plants overseas or south of the border was labor costs. But automation alone reduced manufacturing jobs by more than 80 percent and new robotics and AI are likely to reduce the workforce even more. That means large companies will likely look at regulation and transportation costs as more impactful than labor. This favors the current deregulation and America First trend. While there are fewer manufacturing jobs globally, it’s harder to undercut America’s labor force.
But the biggest impact to U.S. workers could come in other industries. Just like the Japanese have introduced AI to white collar tasks, America is likely to follow suit. But more troubling is the growing trend toward unmanned vehicles. The upside to greater factory productivity has long been transportation job growth. The driverless car could eventually decimate the taxi, trucking and delivery industries. But the truly bad news is that approximately six percent of all U.S. jobs will fall prey to AI during the next decade.