Lower-skill industries across the world, especially in developing countries, are threatened by advancement in technology. The threat is highest in Ethiopia, which is widely considered the region from which modern humans first set out for the Middle East and places beyond.
According to a report on Technology at Work produced by Citigroup and the Oxford Martin School at the University of Oxford, 85 percent of current jobs in Ethiopia may be lost to robots. In South Africa, 67 percent of jobs may be taken over by automation. In Nigeria the percentage at risk is 65.
The authors show that in the absence of export-led manufacturing growth as a path to prosperity, developing countries will need to search for new growth models as many low-skill services can now be performed by robots. Ethiopia is most at risk because so much of its workforce is still employed in agriculture. In 1900s farming employed 40 percent of the United States workforce, but by the 1970s, it had dropped to only 2 percent at which level it stabilized, even as food production increased. The scope for mechanization in farming is indicated by the fact that an American farmer produces 2,000 tons of grain per farmer, while the Chinese produce 50 tons per farmer and the Africans only one ton per farmer.
The debate over the impact of automation has been going on since the start of the Industrial Revolution as machines replaced humans and include examples such as the Luddites in 1811 to Stephen Hawking’s recent warnings over Artificial Intelligence. Most recently, the topic has been chosen as the primary theme for the 2016 World Economic Forum meeting in Davos with a focus on the Fourth Industrial Revolution, while the Financial Times awarded their 2015 Business Book of the Year to Martin Ford’s “The Rise of the Robots”.
In 1961, Time magazine published a story called “The Automation Jobless” which stated that “The number of jobs lost to more efficient machines is only part of the problem. What worries many job experts more is that automation may prevent the economy from creating enough jobs.”
Job destruction recently has been most visible in the digital disruptor space as Blockbuster Entertainment employed 60,000 people across the globe in 2004, but with the rise of Internet video streaming services such as Netflix, the firm filed for bankruptcy in 2013. Similar job destruction has taken place in media with employment in this sector of the economy dropping to just 450,000 in 2012 from over 700,000 Americans in 2002. Employment in the US telecommunications sector has fallen from 1.28 million in 2002 to just 860,000 in 2012.
As robots become faster and cheaper, they will transform the manufacturing and service industries with the International Federation of Robotics (IFR) forecasting that global sales of industrial robots are expected to grow 15 percent per year with the number of units expected to double to around 400,000 units in 2018. Service robots will be the fastest growing sector with unit sales expected to increase to around 35 million units with a sales value upwards of $12 billion between 2015 and 2018.
Despite strong potential growth, there nevertheless still exist barriers to the widespread adoption of automation and robotics in various sectors. These include the initial capital investment required, a shortage of skills and expertise, and a lack of understanding of how companies, especially small and medium firms can produce an attractive return on their investment, but these barriers are falling rapidly.
Rapid wage gains (plus aging populations) in large manufacturing-producing countries – especially China – have changed the relative costs of labour versus robots. In addition, the prices of hardware and ‘enabling’ software have declined markedly, making it an increasingly attractive investment, while technological advances such as vision sensors, gripping systems, etc. have increased the scope and usability of robotics. This makes robots smarter, safer and more applicable across a broader range of processes, but also capable of delivering more consistent and better product quality. Therefore even relatively low-wage countries such as India and Indonesia have seen brisk robotic sales.
Over the years, computers and their applications have changed the way businesses function and the way we work. The Internet today is considered a fundamental infrastructure in most countries. It has created jobs either directly related to technology such as Internet engineers and hardware specialists or jobs directly related to its eco-system — such as the creation of apps and the analysis of data.
According to Cisco, by 2020 there will be 50 billion devices (or more than five devices per human) around the globe connected to the Internet and collecting data, and as the number of connected devices explodes, the number of developers around the world contributing to the Internet of Things would increase from 500,000 to 4.5 million people.
As of January 2016, there were over 30,000 Data Specialist job openings on Linkedln in the US alone and many more around the globe. In 2012, there were 133,000 robot engineers in the US who research, design, develop, and test robotic applications, while a further 17,000 robotics technicians helped build, install, test or maintain robot equipment or related automated production systems. The numbers for these jobs are expected to increase by an estimated 30,000 for robot engineers and over 4,000 for robot technicians from 2012 to 2022 in the US.
The digital economy and the Internet are also helping small and medium-sized firms (SMEs) grow their businesses more effectively by procuring inputs and selling globally directly over the Internet, often resulting in the demand for more workers. The Internet has also helped to open up markets for home-based businesses.
Prosthetic and therapeutic robotic devices will grow into a $1.9 billion and $1.7 billion market by 2025 respectively, as an aging population demands better quality of life and superior performance, according to Lux Research. Therapeutic robotics — devices that help a range of conditions from strokes to spinal cord injuries — are less sensitive to the availability of insurance reimbursement, so most of this market will be from sales to centralized rehabilitation centers.
The number of people aged 65 or over is projected to rise to nearly two billion in 2050. This will raise the population of those with debilitating diseases requiring rehabilitative care. The number of patients needing rehabilitative robotics is on the rise, not only because people are living longer, but also because incidences of conditions like stroke are increasing, and life expectancy of those affected is growing. According to the American Heart Association, the number of stroke survivors is to rise by 68% by 2050, from the current 665,000. Similarly, survivors of spinal cord injuries are growing.
“Robotics is rapidly entering the future of health care as a tool that will enable more advanced and personalized care for millions of patients. As longevity increases, more people are demanding better rehabilitative care,” said Maryanna Saenko, Lux Research analyst said.
“The rapid rise in patient numbers degrades medical providers’ ability and further stresses the need for more robotic technologies to assist in treatment,” she added.