As we move into 2023, one trend that will see a much broader application in the year ahead is the use of automation technologies, especially those with built-in AI and machine learning capabilities. These solutions are being used to support more and more areas of business, as companies recognize just how powerful and cost-effective they can be.
Examples of this abound in the food service industry, which has struggled with labor shortages for the past few years. In fact, as many as half of U.S. restaurant owners intend to implement automation technology within the next two to three years. Just last month, McDonald’s began testing a conveyor system that delivers food to a mobile-order lane. Uber Eats, meanwhile, allows customers in some cities to have their food delivered by autonomous, sidewalk-trotting robots.
Companies in other industries are introducing innovative new automation capabilities as well. Amazon’s new robot arm, Sparrow, can detect, select, and handle products in their inventory. The robot is currently deployed at one warehouse, but the company envisions a wider rollout as soon as this year. In the agricultural sector, last year John Deere revealed its fully autonomous farm tractor, the culmination of nearly two decades of planning and investment.
Automation is also beginning to creep into occupations that have traditionally required a significant amount of human input. By 2026, 10% of call center interactions will be replaced with conversational AI, up from 1.6% today. In the IT space, Forrester predicts that in 2023, “TuringBots” (AI that writes code) will write 10% of worldwide code and tests. We could even see driverless trucks in the not-so-distant future, a move which would transform the global supply chain.
Then there’s generative AI — AI that can create content like text and images — which it feels like we’re seeing everywhere right now. Although there are ethical issues around how this new type of AI will impact artists and content creators, it could help some workers by automating routine tasks like writing form e-mails or copy editing. Forrester anticipates that 10% of Fortune 500 enterprises will generate content with AI tools in 2023, and Gartner predicts that 30% of outbound messages from large organizations will be synthetically generated by 2025.
If these numbers are any indication, most of us will feel the effects of automation on our job at some point in our lives — that is, if we aren’t already using or working alongside these tools! But what factors are driving the sudden surge and interest in these technologies? And what does this shift really mean for people’s jobs? Let’s take a look.
A perfect storm
Although we can make the case that the widespread adoption of automation will have a net positive impact on the workplace, the reasons behind this aren’t entirely favorable — at least from the employer perspective.
First there was the pandemic, which accelerated the use of automation as workers were forced to stay home for safety reasons. This was especially notable in services industries, where companies had to quickly put contactless service mechanisms in place to avoid business disruptions. Fears around COVID-19 have obviously diminished since then, but many organizations have been reluctant to revert back to human labor — and for good reason.
That’s because wage hikes are making it increasingly difficult for employers to hire workers, at least at the old pay rates that allowed businesses to remain so profitable. One survey found that the lowest pay workers would accept for a new job has risen to almost $74,000. Meanwhile, about half of all states are expected to implement a higher minimum wage in 2023. This is good news for workers, but for companies, automation could be a more cost-effective alternative than raising people’s pay.
Union demands are also linked to employers’ growing interest in automation. Between October 2021 and March 2022, union petitions filed at the U.S. National Labor Relations Board increased 57%. Starbucks, Google, and Amazon are a few notable examples of companies whose employees have formally organized within the past year. For these businesses, replacing manual labor with machines would be a way to avoid these workforce issues entirely or maintain operations when employees are on strike.
And let’s not forget that many of today’s employees are simply more willing to quit if they’re unhappy at work. In my company’s latest research with UKG, we found that 45% of employees worldwide don’t want to work anymore. And this isn’t anything new — in fact, the Great Resignation has been going on for nearly two years now. That’s a long time for businesses to be dealing with labor shortages, so it’s no wonder so many are turning to automation as a solution.
The move toward greater pay transparency is also contributing to the rise in automation. With several new laws going into effect this year, it’s estimated that roughly 1 in 4 workers will soon be covered by a state or local law that requires pay transparency. This will go a long way toward closing pay gaps for women and minorities, but businesses may have to adjust their salaries as a result. For some companies, it may be necessary to invest in automation technologies to help offset these increased labor costs.
Lastly, some 98% of CEOs are bracing for a recession within the next 12-18 months, which means they’ll be looking for areas where they could drive greater efficiencies. Not surprisingly, most articles on recession-proofing your business highlight automation as an important solution that can reduce labor costs and help employees work more efficiently.
Will it be “Robots vs. Humans”— or more of a middle ground?
One of the main concerns about the rise of robots is that these technologies will take over roles that used to belong to people, causing mass employment — an apocalyptic scenario, by some estimations. For example, a few years ago, McKinsey predicted that around one-third of U.S. workers could be jobless by 2030 due to automation.
That’s an alarming statistic, but there’s an important distinction to be made here, which is that many of these workers won’t actually be out of a job completely. Rather, they could simply end up in a redefined role, and often within the same occupational category. In fact, the number of people who will be forced to seek out a new line of work due to automation is only estimated to be around 15 million, or 9% of the U.S. population.
That’s because in many cases, automation is changing jobs rather than displacing them entirely. Going back to the Amazon example, the company has shared that the introduction of robots in their warehouses created over 700 new categories of jobs. The fact is, most robots still require people to operate them. And not only are workers are eager to develop these technical skills, but they increasingly have robust educational programs to support them.
Of course, automation-driven job loss does exist in some capacity, but this isn’t always a bad thing. Robots are often being used to take over mundane, dangerous, or highly repetitive jobs that we know are detrimental to human health and happiness. So when we think about it, the rise of automation presents us with a unique opportunity to boost our collective well-being and spend more time on meaningful work. And I think that’s exactly the kind of future we should all be working towards.
Thanks for reading — be sure to join the conversation on LinkedIn and let me know your thoughts on this topic!