Will a Robot Steal Your Job?
More than a century ago, a Czech playwright coined the term “robot” in a fictional story about artificial
human beings. In the past few decades, advances in information technology, particularly in the field of
artificial intelligence, have made robots an everyday reality. Robots can be found performing jobs in
many different types of work-places. Today’s robots include not only physical robots, such as Boston
Dynamic’s dog-like Spot, an agile mobile robot that can be used for a variety of purposes, but also
software robots, sometimes referred to as robotic process automation (RPA) or just software “bots.”
Software bots can emulate human actions in interacting with digital systems, such as identifying and
extracting data and under-standing what is on a screen, but do so faster and in a more consistent
manner than a person might.
While many businesses champion the use of robots and other forms of automation as engines of higher
productivity, operational efficiency, improved profit margins, safer workplaces, and job creation, others
are concerned that these technologies are stealing jobs away from the people who most need them.
This controversy is not new: tension around the use of automation has been a recurring theme since the
first Industrial Revolution in the eighteenth century. However, the Covid-19 pandemic has ushered in a
new host of variables, accelerating the progress of automation as well as potentially deepening its
impact.
Industrial robots are primarily used in manufacturing and for logistics, such as in warehouses. Many are
fully autonomous and able to complete their tasks without any human intervention. A cobot (short for
“collaborative robot”) works collaboratively alongside humans. Worldwide, the use of industrial robots
in factories has nearly doubled over the past five years, according to the International Federation of
Robotics. Sales in the past two years have particularly boomed, in part due to businesses attempting to
adjust to changes wrought by the Covid-19 pandemic, such as changes in buying habits. For example,
Texas grocery chain H-E-B has installed several auto-mated microfulfillment systems from robotics
company AutoStore to support its curbside pickup and delivery services. Giant stacks of cubes about 6
inches apart are packed with bins filled with products. It would not be possible for humans to reach the
bins. Instead, a robot travels across the top of the cube, digging out bins and delivering them to stations
where workers assemble the orders. Currently, AutoStore has installed similar systems at more than 750
sites across 40 countries.
Robots are also being called upon to help with labor shortages that have followed in the wake of the
pandemic. Kenco, a third-party logistics provider, is deploying self-driving robots and testing
autonomous tractors that can tow pallets as well as remotely operated warehouse forklifts that can be
operated from anywhere in the world. Software bots are being employed to handle customer service
call center re-quests, office tasks such as processing payroll data and expense reports, and even complex
tasks such as reviewing legal documents. Applied Materials, which supplies equipment, services, and
software to the semiconductor industry, is attempting to stretch strained resources by using more than
250 bots to automate financial accounting and other workplace processes. According to research firm
International Data Corp, up to 40 percent of companies worldwide have increased their use of software
bots and other forms of automation in response to the pandemic.
Research is mixed on whether robots and other forms of automation result in the permanent replacement of workers. Some have found that robots and other forms of automation are reducing the
demand for workers, weighing down wages, and pushing workers into low-paying parts of the economy.
For instance, one study by economists Daron Acemoglu of MIT and Pascual Restrepo of Boston
University found that for every robot per thou-sand workers, up to six workers lost their jobs and wages
fell as much as 0.75 percent. Acemoglu and Restrepo found little employment increase in other
occupations to offset job losses in manufacturing. Acemoglu and Restrepo noted that a specific local
economy, such as Detroit, could be especially hard-hit, although nationally the effects of robots are
smaller because jobs were created in other places. The new jobs created by technology are not
necessarily in the places losing jobs, such as the Rust Belt. Those forced out of a job by robots generally
do not have the skills or mobility to assume the new jobs created by automation. They are forced to
compete with other workers for whatever jobs are left, which increases labor supply and depresses
wages.
However, another study by Dixon, Hong, and Wu that examined data from Canadian businesses over a
five-year period found that investments in robotics resulted in an increase in total firm employment, in
part because enhanced productivity led to increased demand for the firm’s products, requiring more
employees. The research also found that those investments were primarily motivated by a desire to
improve product and service quality rather than to reduce labor costs.
A 2021 report by McKinsey Global Institute on the post-Covid-19 labor force predicted that more than
45 million US workers could be displaced by automation by 2030, but it is important to note that this
number is not the same as actual jobs lost. The report further notes that it expects that 90 percent of
those workers would transition to jobs within the same occupational category. Likewise, the World
Economic Forum predicted that while technology may eliminate 85 million jobs by 2025, it would at the
same time create 97 million new ones, a net addition of 12 million.
Although the research may appear contradictory, what is mostly undisputed is that robots and other
forms of automation are likely to displace workers in certain types of jobs in certain industries in the
short term. In addition, the effects of automation are not equally distributed and may contribute to economic inequality. Researchers from the Brookings Institution found that advances in automation will
disproportionately affect Black and Latinx workers, who are overrepresented on a percentage basis in
the job occupations that have the highest risk of being automated in the next two decades: those that
are characterized as “middle-skilled,” which often require specialization in routine tasks. In contrast,
high-skill jobs that involve nonroutine cognitive tasks and low-paying service-sector jobs in hotels,
restaurants, and nursing homes are much less likely to be automated. Much of this service work is
difficult to automate, and employers have less incentive to replace low-wage workers with machines.
How can you “future-proof” your career to deal with the potential impact of automation? Experts in the
field offer some guidance. The World Economic Foundation reports that the top skills employers will be
seeking include critical thinking and problem solving. Daniel Zhao, a senior economist at Glassdoor,
recommends that workers build skills that are complementary to technology and sharpen up soft skills
that are hard for machines to replace. Mark Muro, senior fellow and policy director at the Brookings
Institution, suggests that workers should seek work that has a creative, face-to-face, human element
and notes that personalized work, team-work, and creative work will last. Ravin Jesuthasan, a global
transformation leader at Mercer, believes that there will always be demand for work requiring
judgment, creativity, and empathy—in short, the things that make people human.
Sources: Kenco, “Labor Shortage Impacts: Mitigation Through Innovation,” Blog.kencogroup.com,
accessed June 7, 2022; IFR, “Robot Density Nearly Doubled Globally,” Ifr.org, December 14, 2021; Allison
Prang, “Companies Order Record Number of Robots amid Labor Shortage,” Wall Street Journal, November 11, 2021; Ashley
Nunes, “Automation Doesn’t Just Create or Destroy Jobs—It Transforms Them,” Harvard Business Review, November 2, 2021;
Angus Loten, “Workplace Automation Bots Gain Clout amid Covid-19 Pandemic,” Wall Street Journal, September 22, 2021;
World Economic Forum, “Robots and Your Job: How Automation Is Changing the Workplace,” Weforum.org, June 24, 2021;
Jennifer Smith, “Warehouses Look to Robots to Fill Labor Gaps, Speed Deliveries,” Wall Street Journal, May 24, 2021; Jay Dixon
et al, “The Robot Revolution: Managerial Consequences for Firms,” Management Science, March 31, 2021; Kevin Carey, “Do
Not Be Alarmed by Wild Predictions of Robots Taking Everyone’s Jobs,” Slate.com; March 31, 2021; Kristen Broady et al, “Race
and Jobs at Risk of Being Automated in the Age of Covid-19,” Brookings.edu, March 4, 2021; McKinsey Global Institute, “The
Postpandemic Economy: The Future of Work After Covid-19,” February 2021; Angus Loten, “Software Bots Multiply to Cope
with ‘Stretched’ Resources, Wall Street Journal, January 25, 2021; Christopher Mims, “On the 100th Anniversary of ‘Robot’,
They’re Finally Taking Over,” Wall Street Journal, January 23, 2021; Jennifer Smith, “Smaller Is Big in New E-commerce
Warehouses,” Wall Street Journal, November 8, 2020; Daron Acemoglu and Pascual Restrepo, “Robots and Jobs: Evidence from
US Labor Markets,” Journal of Political Economy, 2020.
Note: This case is copied from Laudon, C. K., Laudon, P. J., Traver, C.G. (2013). Essentials of MIS (15th Edition). Pearson Education, Inc.
Questions:
1. How does automating jobs pose an ethical dilemma? Who are the stakeholders? Identify the options
that can be taken and the potential consequences of each.
2. If you were the owner of a factory deciding on whether to acquire robots to perform certain tasks,
what people, organization, and technology factors would you consider?
3. How has the Covid-19 pandemic impacted the process of automation?
4. What types of work and workers are likely to be among the most affected by the increasing use of
robots and other forms of automation?